MDMA Report: Jan 2010

Senate Passes Health Reform Bill

On December 24, the Senate passed H.R. 3590, the Patient Protection and Affordable Care Act (PPACA) along party lines by a vote of 60-39. The bill included numerous provisions of interest to device manufacturers including the imposition of an annual fee, disclosure of financial relations and other provisions. Of notable interest, the Senate bill included a slightly modified version of the device fee. Specifically, the device fee included in the Senate bill will total $20 billion over 10 years and begin in 2011. The fee will be $2 billion annually from 2011-2016 and increase to $3 billion in 2011. In addition, the fee remains non-deductible and includes a small business exemption similar to earlier Senate legislation. Specifically, it would exempt the first $5 million in U.S. sales from any tax and U.S. sales from $5-25 million would be taxed at half the rate.

The House and Senate must now reconcile each body’s respective legislation. Throughout this process, MDMA will continue to work closely with House and Senate staff to improve the device related provisions, including the device tax. While MDMA opposes the imposition of a new tax on the industry, it is unlikely that the tax will be excluded in its entirety. Therefore, we are also engaged in discussions to minimize the impact of the tax on our membership. Specifically, MDMA has been working on an amendment that would exempt the first $100 million in U.S. sales from any tax and U.S. sales from $100-150 million would be taxed at half the rate. We are also seeking to delay the start date until 2013.


Universities Weigh In on Patent Reform

Several universities from across the country sent a letter to the White House recently expressing concern over the Patent Reform Act of 2009. Specifically, the letter expressed concern over post-grant review provisions in both the House and Senate version of the patent bill. Universities are often the starting point for many technologies that later go through the commercialization process, including medical technologies. The letter cites the concern with the post-grant review provisions in both bills, which they believe would ultimately hamper the ability of university-based technologies to reach the market.

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Global Administrator | 1/1/2010 5:27:45 PM | 0 Comments