§ 48D. Qualifying therapeutic discovery project credit
(a)
In general
For purposes of section
46, the qualifying therapeutic discovery project credit for any taxable year is an amount equal to 50 percent of the qualified investment for such taxable year with respect to any qualifying therapeutic discovery project of an eligible taxpayer.
(b)
Qualified investment
(1)
In general
For purposes of subsection (a), the qualified investment for any taxable year is the aggregate amount of the costs paid or incurred in such taxable year for expenses necessary for and directly related to the conduct of a qualifying therapeutic discovery project.
(2)
Limitation
The amount which is treated as qualified investment for all taxable years with respect to any qualifying therapeutic discovery project shall not exceed the amount certified by the Secretary as eligible for the credit under this section.
(3)
Exclusions
The qualified investment for any taxable year with respect to any qualifying therapeutic discovery project shall not take into account any cost—
(4)
Certain progress expenditure rules made applicable
In the case of costs described in paragraph (1) that are paid for property of a character subject to an allowance for depreciation, rules similar to the rules of subsections (c)(4) and (d) of section
46 (as in effect on the day before the date of the enactment of the Revenue Reconciliation Act of 1990) shall apply for purposes of this section.
(c)
Definitions
(1)
Qualifying therapeutic discovery project
The term “qualifying therapeutic discovery project” means a project which is designed—
(A)
to treat or prevent diseases or conditions by conducting pre-clinical activities, clinical trials, and clinical studies, or carrying out research protocols, for the purpose of securing approval of a product under section 505(b) of the Federal Food, Drug, and Cosmetic Act or section 351(a) of the Public Health Service Act,
(d)
Qualifying therapeutic discovery project program
(1)
Establishment
(A)
In general
Not later than 60 days after the date of the enactment of this section, the Secretary, in consultation with the Secretary of Health and Human Services, shall establish a qualifying therapeutic discovery project program to consider and award certifications for qualified investments eligible for credits under this section to qualifying therapeutic discovery project sponsors.
(2)
Certification
(A)
Application period
Each applicant for certification under this paragraph shall submit an application containing such information as the Secretary may require during the period beginning on the date the Secretary establishes the program under paragraph (1).
(e)
Special rules
(1)
Basis adjustment
For purposes of this subtitle, if a credit is allowed under this section for an expenditure related to property of a character subject to an allowance for depreciation, the basis of such property shall be reduced by the amount of such credit.
(2)
Denial of double benefit
(B)
Deductions
No deduction under this subtitle shall be allowed for the portion of the expenses otherwise allowable as a deduction taken into account in determining the credit under this section for the taxable year which is equal to the amount of the credit determined for such taxable year under subsection (a) attributable to such portion. This subparagraph shall not apply to expenses related to property of a character subject to an allowance for depreciation the basis of which is reduced under paragraph (1), or which are described in section
280C
(g).
(C)
Credit for research activities
(i)
In general
Except as provided in clause (ii), any expenses taken into account under this section for a taxable year shall not be taken into account for purposes of determining the credit allowable under section
41 or
45C for such taxable year.
(ii)
Expenses included in determining base period research expenses
Any expenses for any taxable year which are qualified research expenses (within the meaning of section
41
(b)) shall be taken into account in determining base period research expenses for purposes of applying section
41 to subsequent taxable years.
(f)
Coordination with Department of Treasury grants
In the case of any investment with respect to which the Secretary makes a grant under section 9023(e) of the Patient Protection and Affordable Care Act of 2009—
(1)
Denial of credit
No credit shall be determined under this section with respect to such investment for the taxable year in which such grant is made or any subsequent taxable year.
(2)
Recapture of credits for progress expenditures made before grant
If a credit was determined under this section with respect to such investment for any taxable year ending before such grant is made—
(A)
the tax imposed under subtitle A on the taxpayer for the taxable year in which such grant is made shall be increased by so much of such credit as was allowed under section
38,
(B)
the general business carryforwards under section
39 shall be adjusted so as to recapture the portion of such credit which was not so allowed, and