Biotech Gets Big Boost From Bills Enacted by Congress

WASHINGTON, D.C. (Nov. 22, 1999) -- Included in the 2000 budget legislation passed by Congress are three measures that give a major boost to the biotechnology industry's efforts to develop new life-saving medicines.

Patent reform, extension of R&D tax credits and protectionof Medicare beneficiaries' access to biotech drugs were attached to the spending bill, which was adopted by the House and Senate last week and only needs President Clinton's signature to become law.

"These key measures will help our members continue their success in bringing new medicines to patients, especially seniors," said Carl B. Feldbaum, president of the Biotechnology Industry Organization (BIO).

Following adoption of the Balanced Budget Act (BBA) of 1997, the Health Care Financing Administration (HCFA) proposed a seriously flawed Ambulatory Payment Classification (APC) system.

"If implemented as originally proposed, it would have restrictedMedicare patients' access to innovative biotech medicines by severely under-reimbursing hospital outpatient departments for those drugs," said Nancy Myers, BIO's director of federal government relations and health care policy counsel. BIO supported a bill, attached to the 2000 budget, that corrects this unintended consequence of the HCFA proposed rule stemming from the BBA.

"The APC legislation," Myers said, "is part of our multi-year effort to ensure that federal health care reimbursement policy does not act as a disincentive to research."

The patent reform legislation, also included in the budget bill, will help patent applicants recoup years of protection lost during reviews of their claims by the U.S. Patent and Trademark Office (PTO). The third key measure for the biotech industry was extension of the R&D tax credit for five years, the longest extension since the credit was enacted in 1981.

"Together the patent reform and extension of the R&D tax creditare huge victories for biomedical research," said Chuck Ludlam, vice president of government relations. "Restoring lost patent protections will help biotech companies raise private investment capital to develop the most advanced drugs. The R&D credit allows our companies to put more of their money back into research.

"Passage of the patent reform culminates a six-year effort byBIO," Ludlam added. "The reform means applicants will receive full-term patent protection even if there are delays at the PTO. It will restore thousands of years annually to the terms of patents issued to our companies. This is especially critical for applicants with breakthrough technologies whose delays tend to be greatest."

BIO represents more than 850 biotechnology companies, academic institutions and state biotechnology centers in 47 states and 26 nations. BIO members are involved in the research and development of health care, agricultural, industrial and environmental biotechnology products.