Mass. Medical Device Industry Sees Hit from Fiscal Cliff Deal
Industry representatives in Massachusetts are saying that the deal to avoid the fiscal cliff will have an impact on the state’s medical device and advanced manufacturing sector. WAMC’s Berkshire Bureau Chief Lucas Willard reports…
The Massachusetts Medical Device Industry Council – or MassMEDIC says that the Bay State is home to over 400 medical device companies, and that about 10% of the state’s total exports are medical devices. Many of Western Massachusetts’ high-tech manufacturing jobs are within the medical device industry,
But MassMEDIC says a deal cut by lawmakers earlier this month to avert the so-called fiscal cliff will have an impact on those jobs.
In a statement via email, President of MassMEDIC Thomas Sommer said he was disappointed that the fiscal cliff deal could not include a delay of a medical device tax that is now in effect. His statement reads in part….
"… Final regulations on complying with the new tax were only released on December 5, giving medical device companies less than one month to put recording and collection procedures into place.”
Sommer explained that the tax will “put a burden on medical technology companies in Massachusetts and around the nation, as company executives will seek to make up the cost of the tax through reductions in R&D spending, reductions in workforce, and less costly off-shore manufacturing options."
And the Associated Industries of Massachusetts – an organization that represents private industry in the Commonwealth – identified three key areas of how the Medical Device Industry could be affected by future budget cuts or sequestration. Research, approval of medical devices, and funding that affects the demand for the devices.
Chris Geehern, an Executive Vice President at AIM, gave evidence of how sequestration will affect medical device makers that rely on research partnerships.
Geehern also said that funding cuts to the Food and Drug Administration will hinder the approval process for new products.
Geehern also said he believes future cuts to medicare and Medicaid would affect health care providers’ ability to use and purchase devices on behalf of patients.
The medical device industry employs 24,000 across Massachusetts.