State Water Board Approves Unprecedented Cutbacks
On May 4th, state water officials met to vote on imposing the first mandatory water conservation rules in state history. Cities and water authorities from throughout California testified at the two-day meeting of the State Water Resources Control Board, which voted on Tuesday to approve the proposed rules. Every city and water district in the state with more than 3,000 customers will be required to reach mandatory water conservation targets ranging from 8% to 36% compared to their baseline use in 2013. The rules will take effect on June 1st. Governor Brown has said that he will support legislation authorizing fines of up to $10,000 per day for those who don't meet their required targets, but no legislation has been introduced yet.
The rules are a result of Brown's April 1st Executive Order that directed the State Water Board to implement mandatory water reductions to reduce potable urban water usage by 25% statewide. The targets are based on per capita water use, so cities with lower use have lower targets and those with the highest use have the highest mandatory targets. The final adopted target for the City of San Diego is a 16% reduction. Other targets for San Diego County include 20% for the City of Oceanside, 28% for the Carlsbad Municipal Water District, and 32% for the City of Poway. A complete list of targets for the state can be found here.
Right now, local water suppliers and the Governor's office have been on record saying the target reductions can be achieved by focusing on landscaping and ornamental elements that utilize water. Biocom believes the city and state understand the importance of the life science industry to the state, so we hope that regulators will consider all other avenues before implementing shut off periods for process water. Since its inception, Biocom has worked with local and state water officials to emphasize the importance of the industry to the region's economy and that this must be considered in any reduction dialogue. We will keep our members up to date on any further regulations that are implemented to achieve the reduction targets.
State Legislative Report
Last Friday May 1 was the deadline for that state legislation with a fiscal impact to the state to be voted out of the policy committees to which they had been assigned. With that deadline behind us, a clearer picture has emerged on what bills will go forward as the year progresses.
A complete list of legislation Biocom is tracking can be found here. Two bills with markedly different outcomes are especially of note, however: AB 463 would require manufacturers of drugs with an annual cost of $10,000 or more per course of treatment to publicly disclose all expenses incurred in connection with that specific drug (from discovery to approval to advertising and marketing). This bill would be a reporting nightmare for small and large companies alike, presuming such a breakdown is even possible. The bill was originally heard in the Assembly Health Committee on April 21, but the author, realizing he likely did not have the votes for passage, chose not to have a vote taken at that time. It was expected that the vote would instead be taken on April 28th, and there are reports the author was working to find the additional aye votes needed. Five hours into that hearing it was announced the bill would not be voted upon, and instead will not be eligible for a vote in January, 2016.
A second bill of a much more positive nature advanced earlier this week. AB 437 by Assembly Speaker Toni Atkins would allow small businesses with accrued state R&D tax credits to monetize those credits for a percentage of their value. Biocom Vice President Jimmy Jackson testified in support of the bill at its full hearing, and the bill passed out of the Assembly Revenue & Taxation Committee on Monday, May 4, by a 9-0 margin. It next will be heard in the Assembly Appropriations Committee.
Drug Pricing Ballot Initiative Filed with CA Secretary of State
On May 6, 2015, an initiative entitled "The California Drug Price Relief Act" was certified for circulation and collection of signatures by the California Attorney General's office. The ballot measure would require drug prices to be paid by any California state agency be no more than the contracted rate for the United States Department of Veterans Affairs. The proponents will now have 60 days to gather 365,880 valid signatures by registered voters to qualify the measure for a statewide vote.
San Diego Congressman Scott Peters Leads Device Tax Repeal Effort
On May 1st, 2015, Congressman Scott Peters (D-CA) led a letter to the House leadership urging them to promptly consider H.R. 160, the Protect Medical Innovation Act, a bill to repeal the medical device excise tax. The bill was introduced by Reps. Erik Paulsen (R-MN) and Ron Kind (D-WI) and has the support of 277 Members in the House - both Republicans and Democrats.
Timely passage of the bill is critical to ensure continued access to innovative health medical technology. The tax is expected to cost manufacturers $29 billion over a decade and result in reduced investments in research & development and job losses, among others. Biocom has constantly advocated against the tax.
17 first- and second-term Members joined Rep. Peters in sending the letter, including California Reps. Juan Vargas, Raul Ruiz, Norma Torres, Pete Aguilar, Julia Brownley, and Ami Bera. Click here to view the letter.
Biocom and State Organizations Commend Reps. Eshoo and Lance on FDA User Fees Legislation
On May 5, 2015, Biocom along with 39 state and regional life sciences associations, sent a letter to Congressman Leonard Lance (R-NJ) and Congresswoman Anna Eshoo (D-CA) thanking them for introducing H.R. 1078, the FDA Safety Over Sequestration (SOS) Act. The bill would protect industry user fees paid to the U.S. Food and Drug Administration (FDA) from any future across-the-board cuts due to sequestration.
In 2012, at the onset of sequestration, the Office of Management and Budget (OMB) ruled that industry-paid user fees, in addition to congressionally-appropriated dollars provided to the agency, would be subject to sequestration. In FY2013, FDA was prohibited from accessing nearly $85 million in user fees. While the sequester was rescinded in FY2014 and FY2015, it is scheduled to be triggered again in FY2016 and will apply to FDA user fees. H.R. 1078 would ensure that those fees are exempt from the infamous cuts. Click here to view the letter.
Congress To Vote On Trade Measures
The United States is currently engaged in two major trade negotiations with Asia and Europe: the Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP), respectively. Because the White House's trade promotion authority (TPA) has expired, both the House and the Senate have introduced legislation (H.R. 1890/S.995) that would reauthorize TPA and establish trade negotiating objectives for trade negotiations.
Biocom supports the bills because they include objectives to improve regulatory practices and promote adequate and effective protection of IP rights. Among others, the bill would provide for strong enforcement of intellectual property rights, secure fair market access opportunities, and ensure that trade agreements reflect standards of protection similar to those found in US law - which is particularly important as it relates to the twelve years of data exclusivities for biologics. The bills will be on the House and Senate floors in the upcoming weeks.
House Committee Releases 21st Century Cures Draft
Last week, the House Energy & Commerce Committee released their second 21st Century Cures discussion draft. The bipartisan draft is much narrower than the version released earlier this year and focuses on three main areas: the National Institutes of Health, drug and device development, and delivery.
Of high importance to us, the bill would increase funding for the National Institutes of Health, both through reauthorization and $10 billion over five years in mandatory funding, starting in FY 2016. A funding increase was not included in the first draft and has been one of our primary requests since the launch of the initiative. Biocom submitted comments to the Committee in March. Click here to view the comments.
The Committee plans to consider the draft in the next two weeks, with a floor vote before Memorial Day. Biocom will submit a response to the Committee expressing on position on the legislative proposal. Please share any thoughts or concerns with Biocom's Associate Director of Federal Affairs, Laure Fabrega.
GO-Biz to Host Webinars In May for Small Business Month
In celebration of Small Business Month, you are invited to join the GO-Biz Office of Small Business Advocate (OSBA) for a series of free webinars to educate small businesses and aspiring entrepreneurs on important requirements and available resources. Space is limited and registration is required - please register now!
Connect Your Small Business to the Global Marketplace
Wednesday - May 13, 2015, 12:00 pm to 1:00 pm
This webinar will cover key issues businesses should consider when exporting, as well as information on export services and programs offered by the state and federal governments. Specific topics will include required documentation, export financing, market assessment, and business matchmaking services. Registration and Detailed Information
California's Small Business Development Center Network
Wednesday - May 20, 2015, 12:00 pm to 1:00 pm
This webinar will describe the variety of services Small Business Development Centers (SBDC) provide to small businesses throughout the state. Services from other organizations, such as SCORE and Women's Business Centers, will also be discussed. In addition, the webinar will provide tips to small businesses on how to obtain financing, including funding resources, requirements, and important considerations. Registration and Detailed Information
Employee and Independent Contractor Definitions
Wednesday - May 27, 2015, 12:00 pm to 1:00 pm
This joint webinar between GO-Biz and the Employment Development Department (EDD) will focus on understanding the differences between a common law employee and an independent contractor. You will learn the common misconceptions about independent contractors and receive information to help classify workers appropriately. For more information, contact Janelle Green at GO-Biz: (916) 322-0694