1. Short title
This Act may be cited as the “Make Medicine in America Again Act”.
Make Medicine in America Again Act
A BILL
To amend the Internal Revenue Code of 1986 to provide for extended expensing of pharmaceutical manufacturing property, and for other purposes.
2. Extension and expansion of cost expensing provisions for Pharmaceutical Manufacturers
Allowance of bonus depreciation for pharmaceutical manufacturing property— Section 168(k)(2)(A) of the Internal Revenue Code of 1986 is amended—
in clause (i), by striking “or” in subclause (III), by striking “or” in subclause (IV), by adding “or” at the end of subclause (V), and by adding at the end the following new subclause:
“(VI) which is pharmaceutical manufacturing property (as defined in paragraph 11).”
in clause (iii), by striking the period and adding at the end “(other than pharmaceutical manufacturing property).”.
Application of applicable percentage— Section 168(k)(6) of such Code is amended by adding at the end the following new subparagraph:
“(D) Rule for pharmaceutical manufacturing property—Notwithstanding any other provisions of this paragraph, in the case of any qualified property which is pharmaceutical manufacturing property, the term “applicable percentage” means, in the case of property placed in service after December 31, 2023, 100 percent.”
Pharmaceutical manufacturing property defined— Section 168(k) of such Code is amended by adding at the end the following new paragraph:
“(11) Pharmaceutical manufacturing property defined—For purposes of this subsection, the term “pharmaceutical manufacturing property” means property, equipment, buildings, or facilities placed in service in the United States for the purpose of facilitating pharmaceutical manufacturing.
“(a) Effective date—The amendments made by this section shall apply to property placed in service after December 31, 2022.”
3. Pharmaceutical manufacturing credit
In general— Subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:
“45U. Pharmaceutical manufacturing credit
“(a) In general—For purposes of section 38, the pharmaceutical manufacturing credit for the taxable year shall be an amount equal to 50 percent of the qualified production activity expenditures of the taxpayer for the taxable year.
“(b) Qualified production activity expenditures—For purposes of this section—
“(1) In general—The term qualified production activity expenditures means—
“(A) wages paid or incurred to an employee of the taxpayer for services performed by such employee in the conduct of a qualified pharmaceutical manufacturing business in the United States (but only if the employee’s principal place of employment is in the United States),
“(B) amounts paid or incurred for any tangible personal property (whether or not otherwise properly chargeable to capital account) used in the conduct of a qualified pharmaceutical manufacturing business in the United States (but only if the primary use of such property is in the United States), and
“(C) any direct or indirect costs paid or incurred in the conduct of a qualified pharmaceutical manufacturing business in the United States.
“(2) Qualified pharmaceutical manufacturing business
“(A) In general—The term qualified pharmaceutical manufacturing business means the trade or business of producing pharmaceuticals and active pharmaceutical ingredients.
“(B) Active pharmaceutical ingredient—The term active pharmaceutical ingredients has the meaning given to such term in section 207.1 of title 21, Code of Federal Regulations (and any successor regulations).
“(C) Pharmaceutical—The term pharmaceutical—
“(i) means any drug (as defined in section 201 of the Federal Food, Drug, and Cosmetic Act), and
“(ii) includes a biological product (as defined in section 351 of the Public Health Service Act).
“(3) Certain health plan expenses treated as wages
“(A) In general—For purposes of paragraph (1), the term wages shall include so much of the eligible employer’s qualified health plan expenses as are properly allocable to such wages.
“(B) Qualified health plan expenses—For purposes of this paragraph, the term qualified health plan expenses means amounts paid or incurred by the eligible employer to provide and maintain a group health plan (as defined in section 5000(b)(1)), but only to the extent that such amounts are excluded from the gross income of employees by reason of section 106(a) of such Code.
“(C) Allocation rules—For purposes of this paragraph, qualified health plan expenses shall be allocated to qualified wages in such manner as the Secretary may prescribe. Except as otherwise provided by the Secretary, such allocation shall be treated as properly made if made on the basis of being pro rata among employees and pro rata on the basis of periods of coverage (relative to the periods to which such wages relate).
“(4) United States—The term United States means the 50 States and the District of Columbia.
“(c) Special rules
“(1) Reduction in basis—If a credit is determined under this section with respect to any property by reason of any qualified production activity expenditures described in subsection (b)(1)(B), the basis of such property shall be reduced by the amount of the credit so determined.
“(2) Coordination with other credits—Any qualified production activity expenditures taken into account in determining the amount of the credit under subsection (a) shall not be taken into account in determining a credit under any other provision of this chapter.
“(3) Limitation on wages taken into account—The amount of wages taken into account under subsection (a) with respect to any employee shall not exceed an amount equal to the contribution and benefit base in effect under section 230 of the Social Security Act for the calendar year in which the taxable year begins.”
Credit allowed against alternative minimum tax— Section 38(c)(4)(B) of such Code is amended by redesignating clauses (x), (xi), and (xii) as clauses (xi), (xii), and (xiii), respectively, and by inserting after clause (ix) the following new clause:
“(x) the credit determined under section 45U,”
Denial of deduction— Section 280C of such Code is amended by adding at the end the following new subsection:
“(i) Pharmaceutical manufacturing credit—No deduction shall be allowed for that portion of the qualified production activity expenditures (as defined in section 45U(b)) otherwise allowable as a deduction for the taxable year which is equal to the amount of the pharmaceutical manufacturing credit determined for such taxable year under section 45U(a).”
Part of general business credit— Section 38(b) of such Code is amended by striking “plus” at the end of paragraph (32), by striking the period at the end of paragraph (33) and inserting “, plus”, and by adding at the end the following new paragraph:
“(34) the pharmaceutical manufacturing credit determined under section 45U(a).”
Clerical amendment— The table of sections for subpart D of part IV of subchapter A of chapter 1 is amended by adding at the end the following new item:
Effective date— The amendments made by this section shall apply to amounts paid or incurred after the date of the enactment of this Act.