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Question 4 Carey Pharmaceuticals Ltd , is involved in research and development activities to produce a new drug. The following expenditures have been incurred during
Question Carey Pharmaceuticals Ltd is involved in research and development activities to produce a new drug. The following expenditures have been incurred during this process: Initial research to understand the biological pathways relevant to the target disease. Amount $ Conducting earlystage laboratory experiments to identify potential drug compounds. Amount $ Clinical trials to test the efficacy and safety of the selected drug compound. Amount $ Developing and testing the final drug formulation, to be branded as Medicure. Amount $While the actual sales of Medicure will not be known until its market launch in late the drug has shown promising results in clinical trials and has received positive feedback from medical professionals. It is anticipated to have a significant market potential, likely generating millions of dollars in revenue. Required: Determine whether the above expenditures related to EACH activity should be considered as research or development and whether it should be expensed as incurred in accordance with AASB Intangible Assets. Calculate the total amount that would qualify to be recorded as an intangible asset and discuss whether it is subject to amortisation charges.
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