Irvine drug maker Allergan Inc., its competitors and cosmetic surgeons are gearing up to battle against a proposed tax to help pay for healthcare reform.
A 10-year, nearly $1 trillion health reform proposal introduced about two weeks ago by Senate Majority Leader Harry Reid, D-Nev., has a provision that would place a 5% tax on elective cosmetic surgeries and procedures such as face lifts, liposuction or Botox injections.
Allergan makes wrinkle-remover Botox Cosmetic, breast implants and other medical cosmetics.
If the so-called “Botax” becomes law, it would raise $6 billion in total.
Allergan and Johnson & Johnson, which competes with Allergan in breast implants, are lining up their arguments against the proposed tax.
“It is a random hit on an easy target that is only punitive and not corrective,” Allergan spokeswoman Caroline Van Hove said in an article that appeared on Minyanville, an investor Web site.
Taxing cosmetic procedures “is unnecessarily punitive on people who have merely decided to enhance their appearance,” Van Hove said.
Allergan and others in the industry already have persuaded lawmakers to cut the tax to 5% from 10%, lobbyists and Senate aides familiar with the situation said in the article.
Cosmetic surgeons argue the “Botax” would hit many women who earn $30,000 to $60,000. Eighty-six percent of cosmetic surgery patients are female.
The tax also could be hurtful to newly jobless women who are looking for ways to increase their marketability to prospective employers, Phil Haeck, the Seattle-based president-elect of the American Society of Plastic Surgeons, said in the Minyanville article.
Cosmetic surgery isn’t the only sector of healthcare that’s fought a proposed tax that is part of reform efforts. Medical device makers already have succeeded in getting a proposed $40 billion, 10-year tax on their sales cut in half by lawmakers.
That effort was led by groups such as AdvaMed and the Medical Device Manufacturers Association.
Both groups are chaired by well-known OC device figures: Michael Mussallem, chief executive of Irvine-based heart valve maker Edwards Lifesciences Corp., and Joe Kiani, chief executive of Irvine’s patient monitoring device maker Masimo Corp.