The Effect of Healthcare Reform on Life Sciences
Posted on Fri, Apr 30, 2010 @ 06:56 AM
By Kate Carpenter, Technical Services Representative
The approval of the "Health Care and Education Reconciliation Act of 2010" will significantly impact the life sciences world.
The obvious impacts are those outlined in the bill.
- Tax credit for small biotech companies. If you have less than 250 people, the company may be eligible for a tax credit for 50% of a qualified investment in clinical trials, pre-clinical research and other activities. This will help startup companies in the expensive early days.
- Pharmaceutical Manufacturer's fee. If you are in the pharmaceutical manufacturing industry, you will have to pay an annual, non-deductible fee according to market share. This does not apply to companies with sales of their pharmaceuticals $5 million or less. It could negatively affect companies who have had millions in sales but are not yet running a profit.
- Sunshine Act. This will require drug, device and biologic manufacturers to document and report all payments and gifts to physicians, teaching hospitals, and providers that are greater than $100.
- CURES Accelerator Network. This is a $500 million fund to support research and product development in research institutions, medical schools, pharmaceutical companies and biotechs for diseases that have been mainly ignored due to expected small profits.
There will also be impacts from the core idea of universal medical coverage for all Americans. As more people get preventive care and insurance helps them pay for medications, drug prescriptions and usage are expected to rise. This will not only boost sales for current drugs on the market, but could open the door to a need for development of certain pharmaceuticals. With more individuals going for diagnoses, there may be new needs to pharmaceuticals that are not yet produced. The affects of this highly debated and controversial bill on the life sciences industry along with the American population still remain to be seen.