[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2707 Introduced in House (IH)]

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118th CONGRESS
  1st Session
                                H. R. 2707

  To mitigate drug shortages and provide incentives for maintaining, 
 expanding, and relocating the manufacturing of active pharmaceutical 
 ingredients, excipients, medical diagnostic devices, pharmaceuticals, 
 and personal protective equipment in the United States, and for other 
                               purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             April 19, 2023

   Mr. Carter of Georgia (for himself, Mr. Soto, Mrs. Miller of West 
Virginia, Mr. Cartwright, Mr. Hudson, Mr. Bilirakis, Mr. Griffith, Mr. 
   Balderson, Mr. Van Drew, Mr. Crawford, Mrs. Harshbarger, and Mr. 
 Langworthy) introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
  To mitigate drug shortages and provide incentives for maintaining, 
 expanding, and relocating the manufacturing of active pharmaceutical 
 ingredients, excipients, medical diagnostic devices, pharmaceuticals, 
 and personal protective equipment in the United States, and for other 
                               purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Manufacturing API, Drugs, and 
Excipients in America Act'' or the ``MADE in America Act''.

SEC. 2. CREDIT FOR PHARMACEUTICAL AND MEDICAL DEVICE PRODUCTION 
              ACTIVITIES IN DISTRESSED ZONES.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by adding at the end 
the following new section:

``SEC. 45BB. DISTRESSED ZONE PHARMACEUTICAL AND MEDICAL DEVICE 
              PRODUCTION CREDIT.

    ``(a) In General.--For purposes of section 38, the distressed zone 
pharmaceutical and medical device production credit for the taxable 
year shall be an amount equal to the applicable percentage of the 
qualified production activity expenditures of the taxpayer for the 
taxable year.
    ``(b) Applicable Percentage.--For purposes of this section--
            ``(1) In general.--Except as provided in paragraph (2), the 
        term `applicable percentage' means 25 percent.
            ``(2) Increased amount where employees reside in distressed 
        zone.--In the case of any qualified pharmaceutical or medical 
        device production business a substantial portion of the 
        employees of which reside in a distressed zone, the applicable 
        percentage shall be 30 percent.
    ``(c) Qualified Production Activity Expenditures.--For purposes of 
this section--
            ``(1) In general.--The term `qualified production activity 
        expenditures' means--
                    ``(A) wages paid or incurred to an employee of the 
                taxpayer for services performed by such employee in the 
                conduct of a qualified pharmaceutical or diagnostic 
                medical device production business in a distressed zone 
                (but only if the employee's principal place of 
                employment is in a distressed zone), and
                    ``(B) qualified pharmaceutical or medical device 
                production expenditures.
            ``(2) Qualified pharmaceutical or medical device production 
        business.--
                    ``(A) In general.--The term `qualified 
                pharmaceutical or medical device production business' 
                means the trade or business of producing qualified 
                pharmaceuticals in commercial quantities.
                    ``(B) Qualified pharmaceuticals.--
                            ``(i) In general.--The term `qualified 
                        pharmaceuticals' means pharmaceuticals, active 
                        pharmaceutical ingredients, excipients, medical 
                        diagnostic devices, or personal protective 
                        equipment.
                            ``(ii) Pharmaceutical.--The term 
                        `pharmaceuticals'--
                                    ``(I) means any drug (as defined in 
                                section 201 of the Federal Food, Drug, 
                                and Cosmetic Act), and
                                    ``(II) includes a biological 
                                product (as defined in section 351 of 
                                the Public Health Service Act).
                            ``(iii) Active pharmaceutical ingredient.--
                        The term `active pharmaceutical ingredients' 
                        has the meaning given to such term in section 
                        207.1 of title 21, Code of Federal Regulations 
                        (or any successor regulations).
                            ``(iv) Excipient.--The term `excipient'--
                                    ``(I) means any inactive ingredient 
                                that is intentionally added to a 
                                pharmaceutical that is not intended to 
                                exert therapeutic effects at the 
                                intended dosage, other than by acting 
                                to improve product delivery, and
                                    ``(II) includes any such filler, 
                                extenders, diluent, wetting agent, 
                                solvent, emulsifier, preservative, 
                                flavor, absorption enhancer, sustained 
                                release matrix, and coloring agent.
                            ``(v) Medical diagnostic device.--The term 
                        `medical diagnostic device' means any device 
                        (as defined in section 201(h) of the Federal 
                        Food, Drug, and Cosmetic Act) intended for use 
                        in the diagnosis of disease or other 
                        conditions.
                            ``(vi) Personal protective equipment.--The 
                        term `personal protective equipment' means--
                                    ``(I) any device (as defined in 
                                section 201(h) of the Federal Food, 
                                Drug, and Cosmetic Act) that is a face 
                                mask, filtering facepiece respirator, 
                                face shield, surgical mask, gown, other 
                                apparel, or glove that is intended for 
                                a medical purpose, and
                                    ``(II) any particulate filtering 
                                air purifying respiratory protective 
                                device that is approved by the National 
                                Institute for Occupational Safety and 
                                Health under part 84 of title 42, Code 
                                of Federal Regulations (or successor 
                                regulations).
            ``(3) Certain health plan expenses treated as wages.--
                    ``(A) In general.--The term `wages' shall include 
                so much of the eligible employer's qualified health 
                plan expenses as are properly allocable to such wages.
                    ``(B) Qualified health plan expenses.--For purposes 
                of this paragraph, the term `qualified health plan 
                expenses' means amounts paid or incurred by the 
                eligible employer to provide and maintain a group 
                health plan (as defined in section 5000(b)(1)), but 
                only to the extent that such amounts are excluded from 
                the gross income of employees by reason of section 
                106(a) of such Code.
                    ``(C) Allocation rules.--For purposes of this 
                paragraph, qualified health plan expenses shall be 
                allocated to qualified wages in such manner as the 
                Secretary may prescribe. Except as otherwise provided 
                by the Secretary, such allocation shall be treated as 
                properly made if made on the basis of being pro rata 
                among employees and pro rata on the basis of periods of 
                coverage (relative to the periods to which such wages 
                relate).
            ``(4) Qualified pharmaceutical or medical device production 
        expenditures.--
                    ``(A) Definition.--The term `qualified 
                pharmaceutical or medical device production 
                expenditures' means amounts paid or incurred (whether 
                or not chargeable to capital account) for qualified 
                property used in the conduct of a qualified 
                pharmaceutical or medical device production business in 
                a distressed zone (but only if the primary use of such 
                property is in a distressed zone).
                    ``(B) Qualified property.--
                            ``(i) In general.--The term `qualified 
                        property' means any tangible personal property 
                        (other than a building or its structural 
                        components) used in the conduct of a qualified 
                        pharmaceutical or medical device production 
                        business in a distressed zone (but only if the 
                        primary use of such property is in a distressed 
                        zone).
                            ``(ii) Exception.--Such term shall not 
                        include any property described in section 50(b) 
                        (determined as if the United States included 
                        Puerto Rico).
    ``(d) Distressed Zone.--For purposes of this section, the term 
`distressed zone' means a population census tract which--
            ``(1) has been designated as a qualified opportunity zone 
        under section 1400Z-1, and
            ``(2) has a poverty rate in excess of 30 percent for the 
        calendar year prior to the calendar year that includes the date 
        of enactment of this section.
    ``(e) Special Rules.--
            ``(1) Application to united states shareholders of 
        controlled foreign corporations.--
                    ``(A) In general.--In the case of a domestic 
                corporation that is a United States shareholder of a 
                qualified controlled foreign corporation, the credit 
                under subsection (a) (determined without regard to this 
                paragraph) shall be increased by an amount equal to 30 
                percent of the corporation's pro rata share (determined 
                under rules similar to the rules of section 951(a)(2)) 
                of qualified production activity expenditures of such 
                controlled foreign corporation for the taxable year of 
                the qualified controlled foreign corporation ending 
                with or within the taxable year of the domestic 
                corporation.
                    ``(B) Qualified corporation.--For purposes of 
                subparagraph (A), the term `qualified controlled 
                foreign corporation' means, for any taxable year, a 
                controlled foreign corporation which does not have 
                gross income that is effectively connected with the 
                conduct of a trade or business within the United States 
                for such taxable year.
            ``(2) Reduction in basis.--If a credit is determined under 
        this section with respect to any property by reason of any 
        qualified production activity expenditures described in 
        subsection (b)(1)(B), the basis of such property shall be 
        reduced by the amount of the credit so determined.
            ``(3) Coordination with other credits.--Any qualified 
        production activity expenditures taken into account in 
        determining the amount of the credit under subsection (a) shall 
        not be taken into account in determining a credit under any 
        other provision of this chapter.
    ``(f) Recapture.--
            ``(1) In general.--If, during any taxable year, property 
        taken into account under subsection (c)(1)(B) is disposed of, 
        or otherwise ceases to be used by the taxpayer in the active 
        trade or business of producing qualified pharmaceuticals in 
        commercial quantities, before the close of the recapture 
        period, then the tax under this chapter for such taxable year 
        shall be increased by the recapture percentage of the aggregate 
        decrease in the credits allowed under section 38 for all prior 
        taxable years which would have resulted solely from reducing to 
        zero any credit determined under this section with respect to 
        such property.
            ``(2) Recapture percentage.--For purposes of subparagraph 
        (A), the recapture percentage shall be determined in the same 
        manner as under section 50(a)(1)(B).
            ``(3) Application to united states shareholders.--In the 
        case of any taxpayer to whom a credit is allowed by reason of 
        subsection (e)(1), paragraph (1) shall be applied by 
        substituting `the controlled foreign corporation with respect 
        to which the taxpayer is a United States shareholder' for `the 
        taxpayer'.
            ``(4) Application of other rules.--For purposes of this 
        paragraph, rules similar to the rules of paragraphs (3), (4), 
        and (5) (other than subparagraph (A) thereof) of section 
        50(a)(1) shall apply.''.
    (b) Credit Allowed Against Alternative Minimum Tax.--Section 
38(c)(4)(B) of such Code is amended by redesignating clauses (x), (xi), 
and (xii) as clauses (xi), (xii), and (xiii), respectively, and by 
inserting after clause (ix) the following new clause:
                            ``(x) the credit determined under section 
                        45BB,''.
    (c) Credit Allowed Against Base Erosion Anti-Abuse Tax.--Section 
59A(b)(1)(B)(ii) of such Code is amended by striking ``plus'' at the 
end of subclause (I), by redesignating subclause (II) as subclause 
(III), and by inserting after subclause (I) (as so amended) the 
following new subclause:
                                    ``(II) the credit allowed under 
                                section 38 for the taxable year which 
                                is properly allocable to the distressed 
                                zone pharmaceutical and medical device 
                                production credit determined under 
                                section 45BB(a), plus''.
    (d) Denial of Deduction.--Section 280C of such Code is amended by 
adding at the end the following new subsection:
    ``(i) Distressed Zone Pharmaceutical and Medical Device Production 
Credit.--No deduction shall be allowed for that portion of the 
qualified production activity expenditures (as defined in section 
45BB(b)) otherwise allowable as a deduction for the taxable year which 
is equal to the amount of the distressed zone pharmaceutical and 
medical device production credit determined for such taxable year under 
section 45BB(a).''.
    (e) Part of General Business Credit.--Section 38(b) of such Code is 
amended by striking ``plus'' at the end of paragraph (40), by striking 
the period at the end of paragraph (41) and inserting ``, plus'', and 
by adding at the end the following new paragraph:
            ``(42) the distressed zone pharmaceutical and medical 
        device production credit determined under section 45BB(a).''.
    (f) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1 is amended by adding at the end 
the following new item:

``Sec. 45BB. Distressed zone pharmaceutical and medical device 
                            production credit.''.
    (g) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred after the date of the enactment of 
this Act.
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