Prescription Drug Safety and Affordability Act of 2006

109th CONGRESS
2d Session

H. R. 4706

To amend the Internal Revenue Code of 1986 to deny any deduction for certain gifts and benefits provided to physicians by prescription drug manufacturers.

IN THE HOUSE OF REPRESENTATIVES

February 7, 2006

Mr. STARK (for himself, Mr. EMANUEL, Mr. DEFAZIO, Mr. DOGGETT, Mr. HINCHEY, and Mr. MCDERMOTT) introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to deny any deduction for certain gifts and benefits provided to physicians by prescription drug manufacturers.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Prescription Drug Safety and Affordability Act of 2006'.

SEC. 2. FINDINGS.

The Congress finds that--

(1) gifts to physicians from pharmaceutical companies lead to the unnecessary prescribing of prescription drugs, inflating the costs of prescriptions and jeopardizing patient safety,

(2) the pharmaceutical industry annually spends $7,800,000,000 promoting and marketing their products, by way of meals, travel subsidies, and other gifts to medical professionals,

(3) drug companies annually spend approximately $10,000 per physician on such promotions,

(4) the present extent of physician-industry interactions appears to adversely affect prescribing and professional behavior and should be further addressed at the level of policy and education, and

(5) either redirecting these funds to research or lowering the costs of prescription drugs is a much more needed expenditure by the pharmaceutical industry.

SEC. 3. DISALLOWANCE OF DEDUCTION FOR PHYSICIAN GIFT EXPENSES OF PRESCRIPTION DRUG MANUFACTURERS.

(a) General Rule- Part IX of subchapter B of chapter 1 of the Internal Revenue Code of 1986 (relating to items not deductible) is amended by adding at the end the following new section:

`SEC. 280I. PHYSICIAN GIFT EXPENSES OF PRESCRIPTION DRUG MANUFACTURERS.

`(a) General Rule- No deduction shall be allowed under this chapter for any physician gift expense paid or incurred by any prescription drug manufacturer.

`(b) Physician Gift Expense- For purposes of this section, the term `physician gift expense' means any gift provided directly or indirectly to or for the benefit of a physician, including gifts of meals, sponsored teachings, symposia, and travel, but not including product samples.

`(c) Prescription Drug Manufacturer- For purposes of this section, the term `prescription drug manufacturer' means--

`(1) any person engaged in the trade or business of manufacturing or producing any prescription drug, and

`(2) any person who is a member of an affiliated group which includes a person described in paragraph (1).

For purposes of the preceding sentence, the term `affiliated group' means any affiliated group as defined in section 1504 (determined without regard to paragraphs (3) and (4) of 1504(b)).'.

(b) Clerical Amendment- The table of sections for part IX of subchapter B of chapter 1 of such Code is amended by adding at the end the following new item:

`Sec. 280I. Physician gift expenses of prescription drug manufacturers.'.

END