Sponsors (3)
The bill uses time‑limited tax credits to boost U.S. production of generics and biosimilars—potentially improving access and domestic jobs—but does so at the cost of reduced federal revenue, added compliance burdens, exclusions that limit eligibility, and deadlines that create investment uncertainty.
Patients (including people with chronic conditions) and hospitals see increased domestic supply of generics and biosimilars, which can lower drug prices and improve access.
Domestic generic and biosimilar manufacturers (including small businesses) receive production and investment tax credits that lower production and capital costs, encouraging U.S. manufacturing and supporting pharmaceutical jobs and supply chains.
Qualifying firms can elect the credit as a direct payment or transfer it to another taxpayer, improving immediate cash flow and making the incentives usable for startups or firms with little tax liability.
All taxpayers could face reduced federal revenue from these credits, which may increase deficits, crowd out other spending priorities, or require higher taxes later.
Manufacturers and investors face uncertainty because the credits phase out or sunset (various deadlines through 2028–2033), which can disrupt long‑lead projects and create a rush to qualify before deadlines.
Manufacturers (especially smaller firms) must comply with documentation, certification, and eligibility rules (including domestic-content proofs), which raises administrative costs and compliance burdens.
Based on analysis of 3 sections of legislative text.
Creates a production tax credit for U.S.-made generic drugs/biosimilars and a 25% investment tax credit for production facilities, with domestic-content bonuses and phasedowns.
Introduced February 14, 2025 by Claudia Tenney · Last progress February 14, 2025
Creates two new federal tax incentives to boost U.S. production of approved generic drugs, licensed biosimilars, and related pharmaceutical components. One is a nonrefundable production tax credit based on a taxpayer’s value added for each eligible component manufactured and sold in the U.S.; the other is a 25% investment tax credit for qualified facilities that produce generics and biosimilars. The production credit includes higher rates for final drug/biologic production, a domestic-content bonus (with documentation), exclusions for certain foreign entities of concern, and a scheduled phase-down and sunset; the investment credit applies to property placed in service after 2026 and sunsets for new construction begun after 2028.