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BioCommunique Article

Biocom Applauds House Vote to Repeal the Medical Device Tax

  • 2018-07-26T15:00:00.000+0000
  • California
  • Author: Laure Fabrega

On July 24, the House passed H.R. 184, the Protect Medical Innovation Act by a 283-132 vote, with 57 Democrats supporting the measure and one Republican opposing it. The bill repeals the medical device excise tax fully and permanently, which has been a top priority for Biocom over the past years. Click here to view the roll call. We now turn to the Senate and urge them to pass the bill.

The tax was created by the Affordable Care Act (ACA) of 2010 and went into effect in 2013. Recognizing its detrimental effects, Congress suspended the tax in 2016-2017 and more recently in 2018-2019. As a result of the 2016-2017 suspension: 70% of companies increased hiring; 73% said the climate for raising capital and funding improved; the average R&D budget was increased by 19%; employee benefits were augmented, according to the Advanced Medical Technology Association (AdvaMed). Click here to view Biocom’s one-pager on the effects of the tax.

“This bipartisan legislation puts an end to short-term suspensions of the tax which have made it very difficult for medical technology (medtech) innovators to make long-term plans for their development. While in place, the tax increased the effective tax rate for the medtech industry, stifling innovation, jobs, economic growth, and delaying patient access to medical technology. A full repeal will free resources that can instead be invested in research and development (R&D), capital expansion and hiring,” said Joe Panetta, Biocom’s president and CEO. Click here to view the full release.

California is home to more than 2,000 medtech establishments which support 78,000 jobs throughout the state and generate $63 billion in economic activity. Biocom commends California legislators, Republicans and Democrats, who supported the bill: Reps. Pete Aguilar, Nanette Barragan, Ami Bera, Julia Brownley, Ken Calvert, Salud Carbajal, Tony Cardenas, Paul Cook, Lou Correa, Susan Davis, Jeff Denham, Duncan Hunter, Darrell Issa, Ro Khanna, Steve Knight, Doug LaMalfa, Ted Lieu, Kevin McCarthy, Tom McClintock, Devin Nunes, Jimmy Panetta, Scott Peters, Dana Rohrabacher, Ed Royce, Raul Ruiz, Eric Swalwell, Norma Torres, David Valadao, Juan Vargas, and Mimi Walters.

“From insulin pumps and heart valves to pacemakers and artificial limbs, our industry has helped increase life expectancy while reducing the burden of chronic diseases. This bill will ensure that medical device manufacturers have the resources to develop the breakthrough products of tomorrow, keep more and more patients alive and address some of today’s most pressing health care challenges, such as the opioid epidemic”, said Panetta.