In a dispute on strategy over proposed medical device taxes in current health care legislation, St. Jude Medical Inc. has quit AdvaMed, the major medical device trade association in Washington.
The group played a key role in lobbying Congress to keep certain clinical trial data secret, as detailed in Sunlight’s recent “Heart of the Matter” multi-media investigation. The investigation tells the story of Bray Patrick-Lake, 39, who participated in a clinical trial sponsored by St. Jude Medical, and later found out she could not access the data collected.
AdvaMed chairman Daniel J. Starks, St. Jude’s chairman, announced yesterday he was resigning from AdvaMed’s board of directors and that the company was withdrawing its membership.
At issue are provisions in the House- and Senate-passed health care legislation that tax medical device companies as a way to help pay for reforms. The House bill contains a 2.5 percent excise tax on the wholesale prices of medical devices sold in the United States beginning in January 2013. The Senate version imposes a $40 billion tax over 1o years.
St. Jude Medical took issue with AdvaMed’s strategy of proposing that medical devices be taxed based on the complexity of their products, which the company believes would unfairly disadvantage it. While such a tax structure is not currently part of the health care proposals, it represents association’s strategy in dealing with them as the legislation moves forward.
Until now, medical device companies have provided a “unified front,” according to the Wall Street Journal, in opposing the health care tax provisions. Medical supply companies spent $23 million on lobbying so far this year and have given current members of Congress $7.7 million through lawmakers’ candidate committees and leadership PACs since 2008, according to a report last month by the Center for Responsive Politics.