Legal Definitions - research and development

Research and Development (R&D) refers to the systematic and creative work undertaken by an organization to increase its knowledge base and to devise new applications of that knowledge. This effort is typically aimed at creating new products, services, or processes, or significantly improving existing ones, often through scientific investigation, technological innovation, or creative exploration.

• Imagine a pharmaceutical company investing heavily in laboratory experiments and clinical trials to discover and test a new compound that could treat a specific disease. This entire process, from initial scientific inquiry to the development of a viable drug candidate, is a prime example of R&D, as it involves extensive scientific investigation to create a novel product.

• Consider a software development firm dedicating a team of engineers and data scientists to build an entirely new artificial intelligence algorithm that can predict market trends with greater accuracy. This work, which involves advancing existing technology and applying new computational knowledge to create a new service feature, clearly falls under R&D.

• Think of an automotive manufacturer exploring new lightweight materials and battery technologies to design an electric vehicle that can travel significantly farther on a single charge. This involves extensive material science research, engineering design, and prototyping to improve an existing product category and develop new technological solutions, all of which are core R&D activities.