S.1891 - Producing Incentives for Long-term production of Lifesaving Supply of medicine Act; PILLS Act (119th Congress)
Summary
S.1891, the PILLS Act, aims to incentivize the production of generic drugs and biosimilars in the United States by establishing tax credits for manufacturers. The bill introduces two main tax credits: a production credit based on the value added to eligible components and an investment credit for qualified facilities used in the production of these components. These credits are designed to encourage domestic production, reduce reliance on foreign entities, and lower the cost of prescription drugs.
Expected Effects
The likely effect of the PILLS Act is an increase in the domestic production of generic drugs and biosimilars. This could lead to lower drug prices for consumers and reduced dependence on foreign suppliers. The tax credits could also stimulate investment in manufacturing facilities within the United States.
Potential Benefits
- Increased domestic production of generic drugs and biosimilars.
- Potential reduction in prescription drug prices for consumers.
- Reduced reliance on foreign suppliers of essential medicines.
- Stimulation of investment in U.S. manufacturing facilities.
- Job creation in the pharmaceutical manufacturing sector.
Potential Disadvantages
- Potential for increased government debt due to tax credits.
- Complexity in administering and verifying the domestic content bonus credit.
- Risk of unintended consequences or loopholes that could be exploited by manufacturers.
- Possible inflationary pressure if the credits are not effectively targeted.
- Delayed impact, as the investment credit applies to property placed in service after 2026.
Constitutional Alignment
The PILLS Act appears to align with the Constitution's general welfare clause (Preamble). By incentivizing the production of affordable medicines, the bill seeks to promote the health and well-being of the American people. The bill's provisions related to taxation fall under Congress's power to lay and collect taxes, duties, imposts, and excises (Article I, Section 8, Clause 1).
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).