If you watch ON THE RECORD at 10pm, you know that the tax on medical devices has stirred up lots of controversy. Last night we had a guest on ON THE RECORD at 10pm who had emailed me that he disagreed with me. I just saw this email below from another viewer…read and post your comment:
RE: Medical device tax … you have it backwards. The Medical Device is not asking for a special break. They are asking that they not be singled out. The Medical Device tax is similar to a sin tax — taxes on things we want less of. Do we want fewer medical devices?
Second, the administration cites the “boom” that will occur. However, this is not universal. For companies whose products are generally for the elderly (pacemakers, defibrillators, heart valves), there won’t be much of a boom as the majority of those patients are already covered under Medicare.
Finally, in your report you cited St. Jude Medical – who is an example of a company that mostly serves the Medicare population. I’d encourage you to look beyond executive compensation, they’ll be fine. A CEO is a sample size of one. So am I. I was one of hundreds laid off in the last few months. Medtronic and Boston are doing the same, so it is not a case of shifting market share. Throughout the industry jobs are pouring offshore. R&D is being slashed.
Why? In addition to the medical device tax, there is also a pattern of slower FDA approvals under this administration combined with requests for larger clinical studies. Products are routinely released in Europe well before the US, sometimes years.
Raise the development cost, delay market introduction, then tax the sale. Those three things together are what is really challenging the industry.
So, I ask you, should the medical devices bear a sin tax?
PS … since I no longer work for St. Jude, I am not speaking for them. Also, love your show. GW