Sunday, March 03, 2013

ColoradoBiz: 'Colorado innovators weigh impact of contested tax: Tough hike for medical device makers"

 Colorado BioScience Association President/CEO April Giles was quoted extensively speaking on behalf of Colorado's Medical Device Industry in Debra Melani's March 1 article. Quoting, in part, to recap Giles' quotes:

"In 2010, faced with paying for President Obama’s $1 trillion Affordable Care Act, lawmakers approved the tax, expected to raise as much as $29 billion in the next 10 years from the $100-billion-plus medical-device industry. The tax made it through the end-of-year fiscal-cliff congressional session intact, but as ColoradoBiz went to press in mid-February, bipartisan bills calling for repeal of the medical-device tax had been introduced in both the U.S. House and the Senate. At stake, according to those in the field, are thousands of jobs and America’s leading edge in the medical-device marketplace. 

'I am absolutely worried,' said April Giles, president and CEO of the Colorado BioScience Association, which has more than 350 members. 'I’m worried for our small businesses, because it really limits their ability to get their product out into the market in a way that they can be successful and reinvest those dollars back into innovation.' The excise tax is levied on total revenue of all medical-device companies, regardless of size or profits. 

Medical-device companies, responsible for everything from MRIs to hip replacements, are significant players in the national and state economy, working to improve patient care. Colorado employs 27,000 people in the bioscience industry, creating 122,000 direct and indirect jobs. That translates into about $10 billion in payroll, at an average annual salary of $82,000, Giles said. The medical-device sector makes up about half of the state’s bioscience industry and has grown by about 14 percent in the past three years, she said...

...Although Giles suspects a less profound impact on the state’s larger companies, they will still feel the blow, she said. 'Our small companies are really driving a lot of innovation right now, and big companies are looking for them to do that for acquisition or partnering. It really does hurt our competitive edge.'... 

...While most in the industry understand they need to contribute to change, Giles said, the question is: At what cost? Colorado companies are already reporting job cuts, investment woes and even troubles with vendors, which are critical to manufacturing-job success, Giles said. 'Vendors are concerned about the ripple effect.” Sure, if a product is significant, a company will get it to market, she said. “But there might be fewer jobs behind it, and it will take longer to get there. Patient access to new technology will be slowed.'... 

...Giles emphasized that her industry knows it should help pay for reform. 'We are from the perspective that everyone is willing to put something on the table to get us there. But we need the Congress to stop playing wars and come to a consensus on what’s going to help this country get back on its feet.'" 
Link to the full article

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