There are many ways in which a pharmaceutical company can be funded. You can use personal savings, get a loan from a financial institution such as a bank, solicit funds from friends and well wishers. The initial capital to run a pharmaceutical company is high. One way of funding the company is through a loan from financial institutions or venture capitalists. If the company is already established, other methods of funding, such as investing the profits in shares and re-investing the profits into the company can be used.
Things You Will Need
- Business plan
- Business skills
Step 1Come up with a business plan. Clearly explain the objectives of the company, marketing plan, financial plan and organizational structure. Indicate the amount of money required to start the company and the sources of this money. Show the monthly and annual projected profits. Also include potential risks and threats that may affect the company. A professional business plan is indispensable when seeking funds from financial institutions.
Step 2Identify several reputable financial institutions. Consider things like interest rates on loans, the maximum amount that can be borrowed, the payback period and security (collateral) requirements. Shop around for the best terms. Be familiar with any penalties that can be charged should the loan go into default. It is also important to know which documents will be required during the loan application process.
Step 3Apply for the loan. Get a loan application form from the financial institution of your choice. The business plan will come in handy when applying for the loan. Attach all the necessary documents to the loan application, most importantly those showing your personal details and assets. Ask for clarification on any points you are not sure about.
Retain any profits earned. Once the company is established, retain or re-invest the profits in company operations. This shortens the period for repaying the loan and creates a reliable source of funding for running the company. Profits can be maximized by minimizing operating expenses and maximizing sales.