Innovation in manufacturing requires investment. People, research, facilities and advanced technology are all key components that contribute to the next great breakthrough in products and processes. Manufacturers from every sector have driven innovation because they have placed a high priority on investing in these areas. In fact, manufacturers account for two-thirds of all private-sector investment in research and development. This has resulted in a competitive advantage for manufacturers in the United States allowing them to grow their business here and around the world. Read More
Today, the president issued an executive order to streamline the federal permitting approval process as a part of his infrastructure initiative. Specifically, the executive order will simplify the permitting process to provide for one federal decision that should be made within two years. The executive order establishing discipline and accountability in the environmental review and permitting process for infrastructure projects can be found here. Manufacturers welcome today’s news and have long called for federal leadership in reducing excessive red tape in the environmental permitting process for infrastructure projects. Accountability and transparency for all permitting decisions are critical to achieving a set of best practices and certainty that will encourage additional private-sector investment and efficiency. Infrastructure should build in a period of a few years, not a decade.
A new Oliver Wyman report just released demonstrates the Health Insurance Tax (HIT) will result in higher health insurance premiums totaling $22 billion for more than 100 million Americans nationwide. This ACA tax will be paid by many, including those who are “fully insured,” meaning those employers who work directly with insurance brokers to purchase employee health plans. Even retirees who are accessing insurance through Medicare Advantage programs will be hit by the HIT.
For manufacturers who are fully insured and those purchasing individual plans, this tax only adds to rising costs and higher premiums. Joe Eddy, president and CEO of Eagle Manufacturing, told his story before the House Education and the Workforce Committee earlier this year. He explained the ACA taxes and compliance burdens “have been costly, disruptive and distracting from the things we are good at doing as manufacturers.”
According to the Oliver Wyman report summarized here, the HIT could raise the cost of premiums by an additional $540 for employees’ families receiving health benefits from fully insured larger employers. Small business owners and their employees could shoulder an additional $500 for family coverage as a result of the HIT. These cost increases are preventable if Congress acts. Manufacturers provide competitive health benefits to attract and maintain skilled employees and because manufacturers know it’s the right thing to do. Congress should be making it easier to provide insurance, not more difficult.
Regrettably, it’s not just the HIT. The medical device tax—another tax that discourages innovation, growth and job creation—is ready to go into effect next year. In 2015, a temporary suspension of the 2.3 percent excise tax on medical device manufacturers was enacted after 29,000 jobs were lost as a result of the misguided tax. However, that two-year relief runs out at the end of 2017, making full repeal of this tax critical to manufacturers of medical devices. Manufacturers support immediate action to permanently repeal the medical device tax to prevent this tax from eliminating jobs and hurting local economies in all 50 states.
It was unfortunate that the Senate did not pass major health care reform legislation in July, but manufacturers urge the Senate not to give up efforts. Both the House and Senate must advance opportunities to address the burdensome taxes associated with the ACA because the deadlines are around the corner and the clock is ticking.
This morning, the Senate is voting on H.R. 2430, the Food and Drug Administration Reauthorization Act of 2017 (FDARA), hopefully with the affirmative action of sending the bill to President Donald Trump’s desk. The bill was passed by the House of Representatives with overwhelming bipartisan support in July.
As noted in a National Association of Manufacturers’ letter to the Senate, “FDARA is the ultimate public–private partnership that supports patients who need lifesaving medical treatments while promoting science, research and technological innovation.”
Manufacturers in America lead the nation in research and development (R&D), driving more innovation than any other sector. Pharmaceutical manufacturers, in particular, account for nearly one-third of all manufacturing R&D. In turn, the United States is a global leader in the development of medical breakthroughs.
Reauthorization of the FDA’s user-fee program would support the research pipeline and accelerate the development of new medicines and treatments. The NAM supports the Senate’s effort to act quickly in voting to reauthorize FDARA as it stands before adjourning for recess. Any delay to this critical legislation would jeopardize America’s position as a global leader in medical discovery.
Efforts to stop the impacts of the onerous Health Insurance Tax (HIT) must continue as the Senate debates health care legislation. This $100 billion tax levied on fully insured health plans is paid by consumers and, if left unaddressed, will be a shock to retirees on Medicare Advantage and Part D plans as well as employers, individuals and families who purchase off-the-shelf health care plans. That tax will go into effect next year.
Manufacturers are fully behind repealing the “Cadillac” tax, the medical device tax, the health insurance tax and the pharmaceutical tax as well as reducing the burden of the employer mandate. The National Association of Manufacturers sent a key-vote letter to the Senate on Wednesday in support of Amendment 271 to underscore the importance of action on these issues. Unfortunately, the amendment failed in a 45–55 vote.
A full repeal of the Affordable Care Act (ACA) will help employers contain rising health care costs and provide much-needed predictability so that manufacturers can continue providing quality health care to employees. Manufacturers encourage the Senate to unlock the stranglehold of the ACA on manufacturers.
Some members of the Oregon legislature continue to propose unwieldy requirements and burdensome rebates on manufacturers of pharmaceuticals in an effort to cap drug prices. These efforts will not “control” the price of drugs for consumers but will instead create scenarios that will likely limit choice, restrict supply and increase costs. Moreover, price controls discourage innovation and act as a disincentive for robust research and development (R&D) efforts.
While rising health care costs are a significant concern for Americans, there are very few examples in history where price controls have worked for a full segment of the population. Artificially setting prices does not take into account all of the costs and factors that go into creating a new product, such as numerous failed clinical trials or drugs whose revenue fail to cover development costs. Price controls distort incentives in the market and result in product shortages, which could ultimately increase future health care costs.
Lawmakers must consider carefully the negative impacts of imposing price controls and diminishing any intellectual property protections. Attempts to jeopardize all of the investment and years of work associated with the creation of new medicines and products will discourage R&D and innovation—all at the expense of manufacturers’ competitiveness and the future well-being of patients. As the legislative session winds down in Salem, we urge elected officials to be mindful of these adverse impacts.
Today, the House Energy and Commerce (E&C) Committee will mark up the FDA Reauthorization Act (FDARA) of 2017 (H.R. 2430). To ensure this critical legislation passes Congress far ahead of a September 30 deadline, manufacturers urge swift action by the committee to keep H.R. 2430 on schedule. Any delay of the FDARA risks future gains in medical discovery and harm to our global standing.
In a March letter to E&C Health Subcommittee members, the National Association of Manufacturers (NAM) expressed strong support for a timely reauthorization of the Prescription Drug User Fee Act of 2017.
The FDA’s user fee program is the ultimate public–private partnership. If approved, this agreement will help the federal government and pharmaceutical and medical device manufacturers continue to drive innovation and usher in competition to bring new and groundbreaking therapies to patients.
Manufacturers urge members of the E&C Committee to support FDARA and avoid any needless risk to public health by opposing drug importation amendments. Any amendment that eases restrictions on the importation of medicines is a distraction. The NAM opposed a similar importation effort in the Senate earlier this year in a key vote letter because it could expose consumers to counterfeit and adulterated therapies. The focus must be on the advancement of new medicines and treatments as well as unambiguous support for scientific innovation by ensuring the FDARA moves forward unimpeded.
From the crossroads of America, Indiana Ports and the American Association of Port Authorities (AAPA) hosted an important session with manufacturers, truckers, engineering firms and thought leaders as well as state and local officials about maximizing infrastructure investments and strategically positioning and advocating infrastructure in ongoing national debates.
Indiana is a top manufacturing state in the nation representing the highest manufacturing employment in the United States—17 percent of the Hoosier workforce. With manufacturing well represented in Indiana’s economic footprint, investment in roads, rails, Burns Harbor on Lake Michigan and two inland ports on the Ohio River could not be more important. Fifty-seven percent of the state’s border is water.
Due to complex supply chains of manufacturers and just-in-time inventory principles, leading manufacturers like ArcelorMittal and Subaru of Indiana need Indiana infrastructure to perform and to perform second to none. The good news is that the state has made significant investments, raised revenues and supported projects that the business community needs to keep competitive. It has a vibrant supply of rail, trucking and waterway services. But these sectors do not operate in isolation.
The challenge, however, remains projects of regional and national significance that make a system-wide impact on the movement of critical materials and goods throughout the country and world. In Indianapolis, roundtable participants raised the genuine concern about the long-term condition of the Soo Lock System and especially the Poe Lock in Michigan. The current Poe Lock was built in 1969 and is at risk of failure. It handles more than 90 percent of U.S.-flag vessel cargo passing between Lake Superior and the lower Great Lakes, including more than 40 million tons of iron ore and coal destined for steel mills.
The status quo of the Poe Lock and the aging locks on the inland waterway system is a threat to manufacturing because a catastrophic failure will harm the economy and jobs. According to a 2015 U.S. Department of Homeland Security report, an unanticipated six-month closure of the Poe Lock would likely result in widespread bankruptcies and dislocations throughout the economy. More than 10 million people in the United States and 2 million to 5 million more in Canada and Mexico would lose their jobs. North American economies would enter a severe recession. The U.S. recession impacts would be concentrated in the Great Lakes region, though California and Texas would experience some of the largest job losses. Entire manufacturing industries would be debilitated, including automobiles; appliances; construction, farming and mining equipment; and railcars and locomotives.
Indiana and others states are competing against industrial behemoths like China, Japan and Germany. Competition between states will always be around, but the focus on edging out the international competition is even more acute. These competitors do not even think twice about robustly investing in infrastructure to support industry. Productivity growth in the United States is central to expanding the U.S. economy, and while it’s bigger than one industry or one state, more efficient transportation and infrastructure systems are necessary to create an environment that fosters increased productivity. The Infrastructure Week message to the president, House of Representatives and the Senate: #TimeToBuild is vital now. The NAM has produced an infrastructure toolkit to provide manufacturers the resources to amplify this Infrastructure Week message.
More than 30 million Americans suffer from diabetes—one of several chronic medical conditions accounting for an overall increased demand for health services as well as increased costs for medical care. Unfortunately, the solutions to chronic conditions are complex, and there is no one simple solution. New innovative treatments and advanced therapies as well as a faster route for generics to be approved by the Food and Drug Administration offer some hope. And coupled with aggressive prevention and wellness practices, there can be additional improvements that include controlled costs and improved outcomes. Read More
Today, the Senate Committee on Health, Education, Labor and Pensions marks up the Food and Drug Administration Reauthorization Act (S. 934). In a March letter to committee leaders, the National Association of Manufacturers (NAM) expressed its strong support for a swift and timely reauthorization of the Food and Drug Administration (FDA) user-fee agreements covering prescription drugs, medical devices, biosimilars and generic drugs. Manufacturers urge the committee to maintain its momentum so that S. 934 can stay on schedule, ahead of a September 30 deadline. Any delay of the FDA Reauthorization Act risks future gains in medical discovery and harm to our global standing. Read More