Policy Matters - March 2011
Policy Matters is a monthly government affairs publication that contains information relevant to the life sciences sector in Washington, including news about bills and communications with local, state and federal elected officials.
Washington Life Science Companies Win Therapeutic Discovery Project Awards
It wasn’t pennies from heaven but it seemed that way late in October when 83 Washington companies received $34,102,339.14 dollars in Therapeutic Discovery Project awards to support 150 projects. That adds up to a lot of pennies for many Washington’s small life science firms working to produce new and cost-saving therapies and in the process creating jobs and increasing Washington’s competitiveness. View a complete list of the Washington company awards.
We hope this is just the beginning. WBBA strongly supported enactment of this program and will continue to work with BIO and our Washington delegation to renew this innovative program.
We are interested in understanding your opinions about the overall success of this program. A survey is being conducted on behalf of BIO to evaluate your company’s personal experience with the program and to lend insights to extending and expanding the TDP program in the future. The survey is designed to ask a series of questions about each project your company submitted an application for, not to exceed four total projects. Please have your company’s application(s) on hand (IRS Form 8942) to help you complete the survey more quickly. The survey will take 10-15 minutes.
Please click the link below to be directed to a site where you will be asked to enter your contact information. Upon verifiying your contact information, you will be invited to participate in the survey. http://www.psasurveys.com/detect.aspx?I.Project=A17282C
Jay Inslee offers letter of support to companies applying to federal grant programs
Maura Little in Congressman Jay Inslee's office kindly sent WBBA the following list of grant opportunities that are available from the Federal Government. If you are interested in applying for one of these grants and would like Congressman Inslee to provide a letter of support, please contact Maura at 206-361-0233. View listing of grant programs.
IRS Request for Comments Concerning Excise Tax on Medical Devices
You may recall that the health care reform legislation (enacted earlier this year) included some revenue raising provisions, including the new excise tax on sales of taxable medical devices made by the manufacturer or importer of the device after December 31, 2012. The tax is equal to 2.3% of the sale price of any device, defined in section 201(h) of the Federal Food, Drug, and Cosmetic Act, intended for humans. The excise tax does not apply to eyeglasses, contact lenses, hearing aids, and any other medical device determined by the Treasury Secretary to be of a type that is generally purchased by the general public at retail for individual use.
WBBA worked with our medical device partners at the federal level to mitigate the impacts of the excise tax on medical devices. While the tax was reduced, we anticipate taking up the issue again with the new Congress. In the meantime, the IRS requests comments concerning implementation of the new excise tax on medical devices under section 4191 of the health care reform bill. Comments are due by March 3, 2011. An electronic version of the three-page notice is available. Notice 2010-89 will appear in Internal Revenue Bulletin 2010-52, dated December 27, 2010.
Washington Ranks Second in 2010 State New Economy Index
Washington ranks second behind Massachusetts in the recent report published by the Kaufmann Foundation and the Information Technology and Innovation Foundation. Strong performance in manufacturing value add, exports, on-line population, on-line agriculture, scientists and engineers, patents and venture capital led to Washington’s rank. Washington scores high due not only to its strength in software (in no small part due to Microsoft) and aviation (Boeing), but also because of the entrepreneurial hotbed of activity that has developed in the Puget Sound region, and very strong use of digital technologies by all sectors. The report indicates that we have a solid foundation from which economic recovery can come.
Study Provides Powerful Evidence of Regulatory Challenges in the Medical Device Sector
MDMA recently released a new study revealing that many innovative new devices are available to U.S. citizens two full years later than patients in other countries. This is one of many findings following a survey of over 200 med-tech companies throughout the country and provides compelling evidence that the current regulatory environment is adversely impacting innovation, patient care and job-creation here in the United States.
Many MDMA members and state associations worked to provide the data for this study. Read the entire study.
FDA Seeks Input on Implementation of Biosimilars Act
The FDA held a 2-day public hearing on November 2 and 3, 2010 to obtain input on specific issues and challenges associated with the implementation of the Biologics Price Competition and Innovation Act of 2009 (BPCI Act). Electronic or written comments will be accepted until December 31, 2010. Learn more on the FDA website.
For the first time, WBBA took a position on a ballot initiative. At its September 22 Board meeting, after much discussion, the Board passed two amendments relative to Iniative-1098, the state income tax initiative. The first amendment approved WBBA taking a position on 1098 and the second amendment approved WBBA taking a position in opposition to 1098. WBBA published a brief statement of opposition on the website. The initiative was defeated by a large margin, 64 percent, in the Nov 2 election.
WBBA’s Sixth Annual Golf Invitational
This year’s event took place– September 13 at Fairwood Golf and Country Club. Many thanks to our sponsors for a great event: Premier – Townsend; Lunch – BioMed Realty Trust, Inc: Photo – Seed IP Law Group PLLC; Beverage Cart - BNBuilders, Inc. and Precision Electric Group Inc.; Golf Carts – Skanska USA Building, Inc.; 150 Yard Markers – Pacific Biomarkers, Inc.; Skilled Hole – KPMG LLP; Lease Crutcher Lewis, and Wells Fargo Insurance Services; Hole Sponsors: altusmedia, Fenwick & West LLP, Praxair Specialty Gases and Equipment, and Prudential Cleanroom Services.
Nearly as much as golfing, golfers like to win awards. This year the best foursome was a heated contest won by Ron Castagno, Chad Hedlee, Tony Kanaly and Bart Maple. Next time you are in the WBBA office, check out their names on the perpetual trophy.
Other winners include: Lee Hinter, Chipping Contest; Rick Post, Putting Contest; Kris Richey, Women’s Longest Drive; Scott Altick, Men’s Longest Drive; Danielle Doeringsfeld, Women’s Closest to the Pin; and Tom Erlandson, Men’s Closest to the Pin.
This annual event raises critical funds for the BioPac, the WBBA’s political action committee.
Washington Department of Revenue Issues Amended Regulations on Tax Incentive Surveys
If your company takes advantage of state tax credits, deferrals or exemptions, be sure to review the changes.
The Washington Department of Revenue recently amended several regulations, including WAC 458-20-268 (“Rule 268”). Rule 268 requires taxpayers to file annual tax incentive surveys in order to take certain preferential tax adjustments, such as credits, deferrals, and exemptions. The following list includes some of the tax adjustments available under Rule 268:
- Claiming the R&D credit against B&O tax, per RCW 82.04.4452
- Applying for sales and use tax deferral for certain manufacturing and R&D activities in rural counties
- Applying for sales and use tax deferral on an eligible investment project in high technology
- Applying for sales and use tax deferral on an eligible investment project in biotechnology products
To obtain a copy of the rule: See the Department’s online Recent Rule and Interpretive Statement Adoptions.
The new amendments, which also apply to WAC 458-20-267 (“Rule 267”), provide that Rule 268 shall recognize three new laws: (1) ESSHB 1597 (Chapter 106, Laws of 2010), (2) SB 2606 (Chapter 137, Laws of 2010), and (3) SHB 3066 (Chapter 114, Laws of 2010). The laws affect the annual reports and surveys due in 2011, for tax incentives or preferences taken in 2010. Accordingly, these amendments provide the following changes to Rule 268 and, if applicable, Rule 267 (annual surveys). Only applications for tax adjustments that the Department has approved are subject to public disclosure. o new filing extensions for annual surveys are now available:
(1) 30-day extension based on circumstances beyond the taxpayer’s control, and
(2) A one-time extension for 90 days. The request must be made in writing and all earlier annual reports and surveys must have been timely filed. No business may be granted more than one 90 day extension.
SHB 3066 creates more consistency for information used in filing Rule 268 annual surveys and Rule 267 annual reports. The bill also eliminates redundant statutory language to provide greater uniformity in certain tax incentive programs.
Beginning June 10, 2010, the due date for Rule 268 annual surveys is April 30th of each year following the calendar year in which the person becomes eligible to claim the tax adjustment.