New Massachusetts Law Provides Tax Credits for User Fees 4118

BUSINESS NEWS

As part of an economic stimulus package signed into law in July by Governor Mitt Romney, Massachusetts' medtech manufacturers are now eligible to receive a 100% tax credit for fees paid to FDA under the product review and approval procedures of the agency's Medical Device User Fee and Modernization Act of 2002 (MDUFMA). The first of its kind, the law goes into effect immediately and applies to all premarket notification (510(k)) and premarket approval (PMA) fees for medical products developed or manufactured in Massachusetts. Under the law's provisions, early-stage medtech development companies that are not yet generating revenues may sell their credits to a third-party manufacturer.

"This law recognizes the value and contribution of the medical device industry to the state's high-technology sector and its overall economy," says Thomas J. Sommer, president of the Massachusetts Medical Device Industry Council. "We believe it will provide additional incentives for companies to grow and expand their operations here."

Sommer estimates that the tax credit will save medtech companies in the state between $2 million and $3 million. This move is expected to be closely watched by other states and regions with key geographic centers of medtech manufacturing.

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