[Congressional Record Volume 157, Number 16 (Thursday, February 3, 2011)]
[Senate]
[Pages S545-S546]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BROWN of Massachusetts:
  S. 262. A bill to repeal the excise tax on medical device 
manufacturers; to the Committee on Finance.
  Mr. BROWN of Massachusetts. Mr. President, I rise today to introduce 
legislation to repeal the tax imposed on medical device manufacturers.
  As my colleagues know, this 2.3 percent sales tax imposed on medical 
device manufacturers--a tax that will ultimately be passed on to 
consumers--is part-and-parcel of the Federal health care reform bill 
that passed last Congress.
  Like others in this chamber, I am extremely concerned that this tax 
could threaten jobs in my State, reduce domestic investment in research 
and development and ultimately diminish access to life-saving medical 
devices for patients.
  Medical technology companies employ more than 375,000 workers in the 
United States. In Massachusetts alone, we have more than 225 medical 
device firms, which employ more than 20,000 workers, and contribute 
nearly $1 billion in payroll. Medical devices are one of our State's 
top exports, contributing $6 billion to our State's economy.
  These are powerfully good numbers. These are the numbers that make my 
State tick, help drive our economy, and keep people working. I want to 
make certain that what happens in Washington does not reverse these 
numbers, does not undermine my State's ability to compete, and does not 
hamper our chances to grow and hire workers.
  Massachusetts' position as an industry leader, a hub of innovation 
and entrepreneurship must be preserved. That has been and will continue 
to be my focus in the U.S. Senate.
  So how do I intend to accomplish this?
  For starters it means working to eliminate the medical device tax, 
which I believe will diminish our ability to compete, will increase 
costs for consumers, and could result in our medical device and 
technology jobs being sent overseas, where the costs of labor and 
production are cheaper.
  The effort that I am spearheading--and that I ask my colleagues to 
join--eliminates the medical device tax in a way that does not add to 
the deficit. I propose eliminating this harmful tax--a tax that will 
stifle innovation, be passed on to consumers, and increase the cost of 
care--and propose that we offset the cost by using unobligated 
discretionary dollars. This is the same source of funding, the same 
offset, that 81 of my colleagues supported yesterday.
  As my colleagues know, I worked on an amendment that would repeal the 
medical device tax last Congress. I will continue this work because the 
harmful effects of this tax are the last thing Massachusetts needs--
more industry jobs lost, our workers at a competitive disadvantage.
  But the medical device tax doesn't just lead to job uncertainty, it 
leads to investment uncertainty as well, which results in private 
capital staying on the sidelines rather than being invested in 
Massachusetts based companies and their workers.
  The medical device tax, coupled with other provisions in the Federal 
health reform bill, increases the level of uncertainty at a time when 
businesses, consumers and investors are craving the exact opposite.
  For example, some medical devices are approved as combination 
products, both as medical devices and drugs and/or biologics. The 
Secretary has yet to determine how these medical devices will be 
captured under the law, how they will be taxed.
  I pledge to work with my Senate colleagues--and during the Medical 
Device User Fee Modernization Act reauthorization slated for next 
year--to ensure that the medical device companies whose products are 
approved as combination products by the FDA are not double-taxed by way 
of the medical device tax and the pharmaceutical tax.
  With the rolling implementation of the Federal health care reform 
bill, this Congress will provide many opportunities for me to protect 
the interests of and work on behalf of Massachusetts families, 
Massachusetts taxpayers,

[[Page S546]]

Massachusetts workers, and Massachusetts businesses.
  I hope my colleagues will join my efforts to find opportunities to 
correct what is wrong with the Federal health reform law--to protect 
innovation, the jobs, and the development and growth that can occur in 
a sector that is vitally important to our Nation's health.
  I know that a robust medical device sector translates into a 
healthier America--physically, economically, and socially. The same is 
true for Massachusetts.
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