U.S. Sen. Tammy Baldwin
Press Release

U.S. Senator Tammy Baldwin Introduces Bill to Increase Federal Investment in Research

Medical Innovation Act asks big drug companies caught breaking the law to reinvest in NIH research

By - Jan 30th, 2015 11:22 am

(Washington, D.C.) – U.S. Senator Tammy Baldwin (D-WI), member of the Senate Appropriations and Health, Education, Labor and Pensions (HELP) Committees, has joined Senators Elizabeth Warren (D-MA), Ben Cardin (D-MD) and Sherrod Brown (D-OH) in introducing the Medical Innovation Act, a bill that would boost funding for critical medical research. The legislation would require large pharmaceutical companies that break the law and settle with the federal government to reinvest a small percentage of their profits into the National Institutes of Health (NIH).  If the policy had been in place over the past five years, NIH would have had nearly $6 billion more every year to fund thousands of new grants to scientists and universities and research centers around the country – almost a 20 percent increase in NIH funding.

“Wisconsin has a rich history in research and science, and the Medical Innovation Act will ensure that we remain a leader in helping our nation develop cures and strengthen our competitiveness when it comes to out-innovating the rest of the world,” said Baldwin. “As a member of the Senate Appropriations and HELP Committees, I look forward to the opportunity to be a strong voice for continuing America’s investments in critical programs the NIH supports.”

In the Senate, Baldwin has been a strong supporter of Wisconsin research, science and innovation. Last Congress, she authored the Next Generation Research Act, which would create a new initiative within the NIH to improve opportunities for our next generation of researchers. The legislation will also promote current and new policies aimed at improving opportunities for young scientists and conduct a comprehensive study on the best possible ways our country can foster and support the next generation of research. Baldwin plans to reintroduce an updated version of this legislation in the new Congress.

As part of the NIH FY2015 Budget, Baldwin had requested that the Appropriations Committee include increased funding of $30.86 billion, which was the funding received by NIH the year prior to the harmful sequestration cuts pushed through by Congressional Republicans. Ultimately, $30.3 billion in funding was included in the FY2015 Omnibus Appropriations bill, which was an increase of $150 million in base funding.

Critical federal investments in medical research have been flat for more than a decade, and today 9 out of 11 research proposals are left unfunded, threatening the pace of new discoveries and undercutting America’s status as the world’s leader in medical innovation. The last decade has also seen a worrisome increase in the number of major drug companies settling with the government for breaking the law and defrauding taxpayers.

The Medical Innovation Act would reverse both trends by making it easier for drug companies to develop the next generation of cures and making it harder for them to profit from breaking the law and defrauding taxpayers. Funding is generated from the biggest and most profitable drug companies – only when they rely on government-supported research to develop billion-dollar, “blockbuster” drugs, and only when they subsequently break the law and enter into major settlement agreements with the government.

In such cases, the government settlements would go forward as they normally do, but the offending company would also be required to reinvest a relatively small portion of the profits it has generated as a result of taxpayer-supported research right back into the NIH. These supplemental payments would equal one percent of the offending company’s profits for each of its blockbuster drugs that can be traced back to government research support, over a period of five years.  This provides a much-needed boost to NIH funding and strengthens accountability for big drug companies caught committing wrongdoing.

The bill text is available here and a fact sheet is available here.

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