PPTA and Six Organizations Oppose NJ Tax on Clotting Factor (June 27, 2013)

ANNAPOLIS, MD—The Plasma Protein Therapeutics Association (PPTA) opposes New Jersey Senate Bill 2132 that imposes a new tax on therapies used to treat bleeding disorders such as hemophilia.

Despite the opposition of the bill by the Pharmaceutical Research and Manufacturers of America (PhRMA); BioNJ; the Health Care Institute of New Jersey (HINJ); New Jersey Retail Merchants Association (NJRMA); New Jersey Business and Industry Association (NJBIA) and National Federation of Independent Business (NFIB), the New Jersey Senate passed the bill on June 24. This bill failed to pass either chamber of the New Jersey Legislature in the prior two legislative terms.

The bill creates “The Bleeding Disorders Treatment Fund” by taxing manufacturers of blood clotting factor 6% and specialty pharmacies at 2% of their sales of blood clotting factor. Blood clotting factor is a highly complex, lifesaving therapy that treats rare, genetic bleeding disorders. PPTA joined by the leading health care organizations in the state of New Jersey oppose any policy that would impose a tax on the sale of a life sustaining medicine.

The funds raised by the state tax would go to the federally funded hemophilia treatment centers in New Jersey and the Hemophilia Association of New Jersey (HANJ), a not-for-profit corporation. This tax would be the first of its kind in the country where a state government would tax one type of business that provides a service for patients and subsequently gives the tax proceeds to other businesses that provide services to those same patients.

“The bill calls the payment by the manufacturers a rebate, but unlike a rebate, that traditionally goes to the purchaser, the funds collected under this legislation would go to the State. This by definition is a tax,” said Julie Birkofer, PPTA, Senior Vice President, North America. “Taxing blood clotting factor sets a dangerous precedent that could have a negative impact on patient access.”

Lifesaving plasma protein therapies include plasma-derived and recombinant blood clotting factors. These unique, biologic products for which no substitute therapies exist, are used to treat bleeding disorders, primary immunodeficiency diseases, Alpha-1 antitrypsin deficiency and certain rare neurological disorders, and are also used in emergency and surgical medicine.

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