Taxing drugmakers, distributors for opioid treatment programs upheld by U.S. appeals court

The Sept. 14 appeals court decision ruled and maintained the surcharge that it should be thought about a tax..

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The U.S. Appeals Court for the Southern District of New York on Sept. 14 upheld a New York law taxing drugmakers and distributors to assist deal with the opioid epidemic.

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” Faced with increasing costs associated with installing statewide opioid dependency and opioid-related deaths, the state legislature crafted the opioid stewardship payment to raise $600 million to respond to the states public health crisis,” the choice checks out. “New Yorks allocation of revenues from the payment therefore highly recommends that the stewardship payment requirement serves basic revenue-raising functions without a regulatory or punitive objective.”.

The Opioid Stewardship Act, enacted in 2018, requires all producers and wholesalers that offer or distribute opioids in the state to pay a cumulative $100 million a year over six years to money prevention, treatment and recovery programs related to the opioid epidemic. It was the first law that sought to combat the opioid epidemic by taxing these business; Minnesota and Delaware have actually since enacted comparable policies.

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Katie Adams –
Wednesday, September 16th, 2020

The exact same year the law was enacted, a federal judge stated it unconstitutional after pharma trade groups sued the state. The groups declared the law did not allow companies to pass the additional charge costs to customers, breaking the inactive commerce stipulation of the Constitution.