The healthcare industry is transforming with new and improved 3D printing technology. From simply printed parts of a medical device to complex 3D printed living tissue, the technology is allowing the healthcare industry to grow exponentially. With medical equipment being one of the most expensive aspects of healthcare, 3D printing can help reduce these costs long term by replacing traditional equipment manufacturing processes. Medical equipment is also a great contributor to the modernization of the healthcare industry with 3D printing being a catalyst for innovation. Companies that are doing exactly this may be eligible for the research and development tax credit.
The Research & Development Tax Credit
Companies in various industries, including firms that utilize 3D printing technologies have been taking advantage of the federal Research and Development (R&D) Tax Credit since 1981. Firms can receive a credit of up to 13 percent of eligible spending for new and improved products and processes. Qualified research must meet the following four criteria:
- New or improved products, processes, or software
- Technological in nature
- Elimination of uncertainty
- Process of experimentation
Eligible costs include employee wages, cost of supplies, cost of testing, contract research expenses, and costs associated with developing a patent. On December 18, 2015, President Obama signed the bill making the R&D Tax Credit permanent. Beginning in 2016, the R&D credit can be used to offset Alternative Minimum Tax and startup businesses can utilize the credit against $250,000 per year in payroll taxes.
Ekso Bionic Suit
The Ekso bionic suit from Ekso Bionics is an exoskeleton made for paraplegics and those with lower body frailty that supports the body and gives them the ability to walk again. Ekso uses 3D printing technology to tailor the bionic suit to its user for comfort and stability. The individual is first scanned to provide a highly accurate model of their body. Components of the suit are then Computer-Aided Designed (CAD) to provide the nearly perfect fit to the patient’s body. Medical equipment like the Ekso bionic suit can change people’s lives by giving them the ability to walk while simultaneously providing comfort thanks to customization by 3D scanning and printing.
3D printing can bring hope and improvement to the lives of those living in third world countries. iLab//Haiti is a non-profit organization that has introduced 3D printers to Haiti, allowing the nation to improve the quality and accessibility of expensive yet critical medical equipment. Participants of the organization have worked on printing umbilical cord clamps, finger splints, and casts – among other equipment – for local clinics. Bringing 3D printers to countries like Haiti allows clinics that are usually in remote locations to improve treatment for patients by providing inexpensive treatments without a relatively long wait period.
Field Ready is a company that provides humanitarian supplies made-in-field to places that have undergone emergencies such as hurricanes, humanitarian crises, wars, and others. Field Ready specializes in making crucial tools in difficult environments, therefore reducing reliance on costly supply chains, and allowing recovery to be done faster and at lower costs. They use CAD models and a variety of 3D printing methods to reach these goals. Field Ready has worked on a multiple disaster sites such as Nepal during the 2015 earthquake, Syria, and in the US Virgin Islands after the recent devastating hurricanes. One of the largest issues in disasters like these is lack of medical supplies. Field Ready works to 3D print disposable medical equipment to be used in disaster-stricken locations, eliminating the high costs and long wait periods associated with imported medical supplies. Some of the equipment Field Ready has printed includes fetoscopes, kidney trays, nebulizers, oxygen tubes, umbilical cord clamps, and parts of machines such as an EKG machine.
Metal is the ideal material for medical equipment due to its biocompatibility and ability to be sterilized. The downside of metal equipment is the cost and time it takes to manufacture these tools. Direct Metal Laser Sintering (DMLS) is a highly detailed mechanism for 3D printing metals. In this process, a laser is used to fuse metal powder together to form a solid part from a CAD model. Micro welding – as many manufacturers term it – is highly specific and time efficient, allowing complex geometric metals to be formed in less time than traditional welding methods. DMLS is a groundbreaking mechanism for medical equipment because of its precision. In one case, an orthopedic surgeon at OrthoCarolina – Dr. Dana Piasecki – used DMLS technology to create a tool that improves the method and outcome of ACL repair surgeries. The ACL is a ligament connecting the tibia and femur and a common area of injury for athletes. Dr. Piasecki decided that there needed to be a solution for ACL repair technique improvement because the two traditional methods were either more difficult to perform than the other or less successful than the other. The Pathfinder ACL Guide was soon developed, produced with DMLS technology. The metal tool combines both traditional ACL repair methods, creating an easier and more successful operation.
The healthcare industry is showing an increased use of innovative 3D printing technology to improve their overall processes and operations. As healthcare costs continually increase, the role of 3D printing technology becomes significant in determining the future for the industry. 3D printing technology is allowing for crucial medical equipment to be produced much faster at lower costs, making the treatment processes more efficient as a whole. Innovative companies that take advantage of the 3D printing and CAD modeling to improve business operations and processes are likely eligible for significant R&D tax credits for doing so.
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Charles Goulding and Rafaella July of R&D Tax Savers discuss 3D printing and medical equipment.
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