Recce Pharmaceuticals (ASX: RCE) has been awarded an AusIndustry Advanced Overseas Finding covering up to A$85 million in eligible research and development expenditure. The finding applies to Recce’s synthetic anti-infective development program and extends across both Australian and overseas activities.
The decision confirms that qualifying offshore R&D will attract Australia’s 43.5% R&D Tax Incentive. The eligibility applies for three income years, spanning 2024–25 through 2026–27. Importantly, the finding does not represent a cash grant or upfront payment.
How the Finding Works
The Advanced Overseas Finding is a formal determination by the Department of Industry, Science and Resources. It allows companies to claim the R&D Tax Incentive on approved international activities that cannot reasonably be conducted in Australia.
For Recce, this includes clinical and laboratory programs outside Australia. The scope captures domestic R&D and overseas work under a single framework. Eligible expenditure may be rebated through the tax system as costs are incurred.
This structure supports companies conducting late-stage trials or specialised research in international jurisdictions.
Programs Covered Under the Approval
The finding covers Recce’s synthetic antibiotic portfolio, including its Phase III Diabetic Foot Infection clinical trial underway in Indonesia. That trial involves patient dosing and international regulatory coordination.
Additional overseas R&D programs across Recce’s infectious disease pipeline are also included. These programs target drug-resistant bacterial and viral pathogens using synthetic polymer technology.
By confirming eligibility in advance, the ruling reduces uncertainty around future R&D claims linked to global trial execution.
Context: Why This Type of Finding Is Used
Advanced Overseas Findings are typically sought by companies with global development pathways. Past recipients have included Australian life sciences and advanced manufacturing firms conducting offshore clinical trials, aerospace testing, or specialist engineering programs.
The mechanism is designed to keep Australian-headquartered innovation anchored domestically, even when execution must occur overseas. It aligns government incentives with internationally competitive development models.
Chief executive James Graham said the finding confirms eligibility “for up to A$85 million in R&D expenditure under the Australian Government’s R&D Tax Incentive.” He added that it supports “global anti-infective programs” and applies to “activities conducted around the world.”
Why This Matters Operationally
The ruling provides Recce with forward certainty over how large components of its development spend may be treated. That clarity is particularly relevant during capital-intensive late-stage clinical programs.
It also supports continuity across jurisdictions as Recce advances candidates addressing antibiotic resistance, a recognised global health priority.
