Along-running effort to repeal a federal tax on medical device makers’ revenue flared up yet again this month.
The Republican minority in the U.S. Senate was pushing to include the repeal in a package of tax breaks that moved through the chamber. The 2.3% tax on device makers’ revenue took effect at the start of 2013. Supporters bill it as a way to raise about $30 billion to pay for healthcare reform.
It typically applies to products not sold directly to consumers, such as replacement heart valves, pacemakers and artificial hips. Devices such as contact lenses, hearing aids and eyeglasses are exempt.
Majority Democrats in the Senate hadn’t decided whether they’ll allow a vote on the device tax repeal. The party is divided on the matter—Democratic senators who represent states such as Minnesota, Massachusetts, Indiana and Pennsylvania have voted in favor of nonbinding votes to rescind the tax, an exception to their overall support of healthcare reform.
A repeal bill was introduced in the U.S. Senate by Democrat Amy Klobuchar of Minnesota and Republican Orrin Hatch of Utah. That bill isn’t being co-sponsored by California Democratic Sens. Dianne Feinstein and Barbara Boxer.
Repeal action has also taken place in the GOP-controlled House of Representatives. For example, Rep. Dave Camp, R-Mich., included the repeal in a draft bill for comprehensive tax reform he released in February.
Camp has said he included repeal in his bill because it had “strong bipartisan support.”
Other attempts to repeal the tax included the Protect Medical Innovation Act of 2013, which was reintroduced in recent months by Reps. Ron Kind, D-Wis., and Erik Paulsen, R-Minn. It hasn’t made it out of committee.
The Kind-Paulsen bill had more than 260 co-sponsors, including retiring Rep. John Campbell, R-Irvine; Dana Rohrabacher, R-Huntington Beach; and Edward Royce, R-Fullerton. Republican Reps. Darrell Issa and Ken Calvert, whose districts cover small portions of South Orange County, were also co-sponsors.
Orange County is a major center of the medical device industry, and many such companies are in Campbell’s district.
Questcor Signs European Deal
Anaheim-based Questcor Pharmaceuticals Inc. said this month that it will work with a European drug maker to develop melanocortin peptides.
It didn’t disclose financial terms or the company’s name but noted it’s privately held and that Questcor has an option to acquire the technology during development.
The drug maker said in a news release that the deal expands its portfolio of melanocortin therapies.
“Our commercial experience and scientific evaluation of both Acthar and Synacthen has allowed us to develop a comprehensive understanding of the potential for melanocortin therapeutics in the treatment of serious autoimmune and inflammatory diseases,” said Steve Cartt, Questcor’s chief operating officer.
Questcor bought Synacthen and Synacthen Depot last year from Swiss drug maker Novartis AG.
Questcor itself is in the process of being bought by Mallinckrodt PLC for $5.6 billion. Mallinckrodt is based in Ireland for tax purposes but operates from suburban St. Louis.
It’s said that Questcor’s operations will essentially remain intact in Irvine, with Cartt heading them and reporting to Chief Executive Mark Trudeau. Don Bailey, Questcor’s current chief executive, will move to a board position.
Griffin-American Buys in Atlanta
Newport Beach-based Griffin-American Healthcare REIT III Inc. bought three medical office buildings in suburban Atlanta for $12.1 million.
The company invests in hospitals, medical office buildings and other forms of healthcare real estate.
The buildings have 72,815 square feet between them.
Bits & Pieces
Mirth LLC, a Costa Mesa-based subsidiary of Irvine-based Quality Systems Inc., said the Certification Commission for Health Information Technology certified its Mirth Connect software as an electronic health record. The designation allows Mirth Connect providers and hospital users to receive funding under the American Recovery and Reinvestment Act. … The Advocates for Health, Economics and Development met this month in Anaheim. The Sacramento-based group’s session topics included the nexus and opportunities between healthcare safety-net issues, health reform, healthy communities and economic development. … Dr. Nick Anas, pediatrician-in-chief at Children’s Hospital of Orange County in Orange, received a pediatrician of the year award from the American Academy of Pediatrics California Chapter 4. He also serves as medical director of CHOC’s pediatric intensive care unit.
