By: Emma Lewis, Myriad Associates Ireland
The human race faces challenges like nothing we’ve ever seen before. From climate change to food packaging to AI, research and development (R&D) work is taking place right now across the world.
Let’s stand still for a moment and marvel at just some of them.
Machine learning and Artificial Intelligence
Sharing knowledge is key to successful innovation. However, in a world that’s packed with ever-changing data, keeping abreast with latest technological discoveries isn’t easy. Information constantly evolves and it’s the manipulation of it that matters just as much.
Where previously data and critical information was painstakingly extracted by hand, nowadays machine learning and Artificial Intelligence can do it for us. Not only that, but it reduces the risk of human error.
Vast quantities of data can be gathered and studied in seconds, helping us with everything from shopping to healthcare. Through constant innovation in this fascinating area, the value and power of data is something that’s opening more doors than ever before.
A healthier, stronger society
R&D is also at the heart of making our lives better. Whether it’s tackling poverty, climate change, food shortages or desease, it’s all about the common good.
We’re not necessarily talking about innovation projects for commercial gain either. Many organisations such as universities, charities and academic institutions are undertaking incredible philanthropic work. Indeed, the government has recently pledged £95 million to be invested in innovation in the NHS. It’s been a broadly welcomed cash injection.
One such project is a pilot scheme being launched by Genomics England to detect rare genetic conditions. Known as the 100,000 Genomes Project, the work aims to sequence 100,000 human genomesto understand more about the role of genetics in disease. On top of that, theDiverse Data projectseeks to address healthcare inequalities by actively encouraging individuals from traditionally under-represented groups to get into genomics research.
Certainly fascinating topics at the cutting edge of modern science.
Collaboration to reduce drug production costs
The COVID-19 pandemic has shown us all too starkly how essential R&D is in the drugs and therapeutics sector. But progress in this area is also some of the most expensive, with new drugs typically costing upwards of €1.3 billion to develop. In Ireland, this makes the industry a big claimer of R&D Tax Credits, which does go a long way towards the cost.
However, pharmaceutical organisationsare increasingly collaborating with small start-up companies making breakthroughs in promising new drugs. Partnership and investment in this way during the early stages of drug production helps make it simpler for them to purchase these small companies outright once the new drug has proven to be marketable.
As time is going on, people are becoming increasingly aware of issues aroundethical food production. As an alternative to intensive farming, research is ramping up into different types of cultured meat that can instead be grown in a lab. Not only can this reduce the rearing of greenhouse gas-emitting animals for slaughter, but also looks to increase worldwide access to affordable, sustainable protein sources.
Scientific projects in this field already have the weight of big names like Bill Gates and Richard Branson behind them. But as technology into safety, production, taste and texture comes on, we’re sure to see the “clean meat” sector starting to boom.
But why does R&D play such a crucial role?
As Edith Widder,Co-founder, CEO and Senior Scientist at the Ocean Research & Conservation Association once said: “Exploration is the engine that drives innovation. Innovation drives economic growth.”
And she’s right. After all, you can have as many innovative ideas as you want but without explorative research and development they’re not likely to come to anything.
R&D is essential for a country’s economic success. But unfortunately, it’s still all too easy to overlook its importance. This is especially the case in these tough economic times when many businesses are simply trying to pay the bills each week.
Massive technological and scientific progress has only happened thanks to robust investment in R&D. A comprehensiveR&D strategy also forms the foundation on which company innovation and creativity can flourish. Many companies even build an R&D department dedicated to the cause (and yes, it can even be done on a budget).
R&D also involves a large amount of planning ahead which can give companies a great competitive advantage. It means looking into the future and predicting problems before they arise, proactively meeting challenges head on. Furthermore, developmental innovation can help an organisation grow much more quickly, launching ever-more products and services that keep them in front of the competition.
Government help is available in the form of R&D Tax Credits
R&D Tax Credits are offered by the Irish Revenue as a tax incentive for all Irish companiesundertaking eligible R&D work inside Ireland or thewider European Economic Area. It’s used to offset a sizeable proportion (up to 37.5% in fact) of a company’s qualifying R&D expenditure, with the rebate administered to offset a company’s Corporation Tax bill. This can be either the current year’s Corporation Tax bill, or the year prior.
The tax credit level is set at a 25% rebate on eligible R&D expenditure,in addition to the standard reduction of 12.5%. So in effect, Revenue will refund up to €37.50 for every €100 of R&D spend.
It’s a fantastic opportunity, not least because the resultant extra funding can be ploughed into further R&D investment. However, the rub comes in applying for R&D Tax Credits in the first place.
Unfortunately, Revenue doesn’t automatically apply R&D Tax Credits as a matter of course. Companies have to apply for the relief themselves, and that in itself isn’t easy. Knowing exactly which project costs can be claimed for is not straightforward. Furthermore, creating an R&D technical report that ‘persuades’ Revenue that the award should be given is tough. Taking a ‘DIY’ approach is frankly likely to lead to disappointment, and any mistakes – however innocent – can easily lead to a Revenue investigation. It’s for these reasons (andothers) that many companies in Ireland instead turn to a professional R&D tax and funding consultancy.
R&D is an investment – not just another expense
R&D will always be relevant in an increasingly cut-throat world. Consumers are obsessively hunting for the next bold piece of technology or the shiniest new gadget. Gone are the days when a company will survive on simply churning out products that are good enough for the here and now. And it’s for this reason that R&D expenditure should never be simply considered another annoying cost that has to be paid for. Rather, it’s an investment into the future – not just of the company or the economy but perhaps of the human race itself.