Life science companies with ongoing R&D activities are now allowed to spend their CSR funds for finding therapies for Covid-19. The new rule was recently formulated by the Ministry of Corporate Affairs.
According to the new rule, companies usually engaged in R&D of any new vaccine, drug or medical equipment as a part of their day to day business may now conduct R&D activities on Covid-19 vaccines, drugs and medical equipment for FY21-23, provided that the research work is done in association with specified public institutes. However, the funding that is provided by the state and central government or state-owned enterprises will qualify as CSR spending. The details of such research have to be disclosed separately in the annual CSR report.
Institutions with which life science companies can join hands with, for Covid-related R&D activities include public funded universities, IITs, national laboratories, institutions under ICAR, ICMR, CSIR and other central ministries and departments. Life science companies with net worth of Rs 500 crore or more are required to spend around 2 per cent of their average net profit of the last three years on CSR activities. The new policy is a part of the MCA’s efforts to boost the R&D and innovation ecosystem in the country.
List of various organisations and incubators involved in research activities for Covid-19: