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GLENS FALLS -- Medical device manufacturers are turning to their employees for help, as they seek to impress upon lawmakers the need to do away with a new medical device excise tax.

The Advanced Medical Technology Association (AdvaMed), a trade group representing companies like AngioDynamics, was in town Monday to speak with AngioDynamics employees about the tax and its impact on the local firm’s ability to innovate.

AngioDynamics President and CEO Joseph DeVivo, who also is on the AdvaMed board of directors, said the effort is new, but it may be rolled out to other companies if it shows results.

“We want to educate (employees) about what’s going on with legislation,” DeVivo said during a Monday meeting with The Post-Star’s editorial board. “We want to educate them about how they can get involved. Hopefully, if this goes well, this will be a prototype for how we work within other device companies to educate and engage.”

AngioDynamics employs 1,400 people worldwide, with an estimated 900 at two local facilities: one in Glens Falls and one in Queensbury. The Latham-based firm makes a wide range of medical devices.

With DeVivo Monday were AdvaMed Senior Executive Vice President JC Scott and AdvaMed Vice President Wanda Moebius. They planned to encourage AngioDynamics employees to let legislators know the 2.3 percent tax on medical device manufacturers’ revenues is stifling innovation and hurting an industry that is one of the few net exporters left in the nation.

The tax was instituted as part of the Affordable Care Act and is aimed at helping to pay for health care reform.

“The medical device tax is certainly sort of the last straw on the camel’s back, if you will, amid a sort of cumulative set of policy headwinds that our industry has been facing for some time,” Scott said. “If you combine — just on the tax front — the fact that we already have one of the highest effective corporate tax rates in the world, and you layer on the medical device tax, that certainly doesn’t help.”

DeVivo took aim at the idea firms like AngioDynamics will benefit from an influx of newly insured citizens as a result of Obamacare. It’s that expected “windfall” for medical industry firms that prompted Congress to enact the medical device tax. But not all medical industry firms are the same, DeVivo said.

“The whole concept that we’re going to make it up by volume, so we’ll pay this tax, is complete ignorance about how our industry works,” he said. “The prices for our products float with the market and are very, very competitive. We don’t have some government price that’s set. Our entire industry has been seeing significant price reductions for the last two years.”

Hospitals, feeling their own revenue hit from the Affordable Care Act as Medicaid reimbursements change, are negotiating aggressively for better prices on medical devices. And because medical devices aren’t paid for by Medicare the way pharmaceuticals are, companies like AngioDynamics have no price protections, DeVivo said.

Scott said his organization is hopeful about progress in repealing the device tax this year, although it’s still unclear how that will come about.

“They have to deal with the debt limit as they get into late summer and into the fall, and there’s discussion now, are they going to try to tie some elements of tax reform to that legislative vehicle,” Scott said. “They’re going to have to do some other fiscal measures before the end of the year, including another tax bill, the so-called tax extenders. So, I think there are going to be a lot of vehicles out there before the end of the calendar year that will give us a decent shot at moving the ball forward.”


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