HR 1396 IH: Generic Drugs and Biosimilars Investment Credit

Direct Link: https://www.govinfo.gov/app/details/BILLS-119hr1396ih

Section 1. Short title; effective date

Short title; effective date.

Subtitle C – Tax credits for certain investments in the manufacture of generic drugs and biosimilars

The Secretary may award tax credits against the tax imposed by section 901 of such Code to an eligible taxpayer for an amount equal to 10 percent of the qualified investment.

Section 2. Credit allowed

(a) In general – The credit allowed under this section shall be $1,000 for each qualified component.

(b) Qualified component; definition

(1) Qualified component; definition.

(A) In general – For purposes of this section, the term “qualified component” means a product or substance that meets the requirements of subsection (c).

(B) Requirement to be met by a qualified component – A qualified component shall meet one of the following conditions:

(i) The component is a drug product that meets the requirements of section 505 of the Federal Food, Drug, and Cosmetic Act.

(ii) The component is a biological product that meets the requirements of section 351 of the Public Health Service Act (as in effect before its repeal by section 204 of the Affordable Care Act).

Section 3. Definitions

(a) Eligible taxpayer – The term “eligible taxpayer” means any taxpayer which is not a foreign entity of concern.

(b) Qualified facility; definition

(1) In general – For purposes of this section, the term “qualified facility” has the meaning given to it by section 48F(b).

Section 4. Treatment under other laws and regulations

(a) General rule – The credit allowed under this section shall not apply to any qualified component the manufacture of which begins after December 31, 2028.

(b) Coordination with rehabilitation credit

(1) In general – For purposes of this subsection, the term “qualified investment” includes that portion of the basis of any property for which no deduction is allowable under section 168 or section 197(a).

Section 5. Definitions

(a) Eligible taxpayer; definition.

(1) In general – For purposes of this section, the term “eligible taxpayer” has the meaning given to it by section 3.

(2) Qualified component; definition.

(A) In general – For purposes of this section, the term “qualified component” has the meaning given to it in section 2(b).

(B) Production; defined

(i) In general – The term “production” has the meaning given to it by section 45BB(c)(6).

Section 6. Effective date and applicability

(a) Effective date

(1) In general – This section shall apply to property placed in service after December 31, 2028.

(2) Applicability to certain expenditures

(A) In general – The preceding sentence shall not apply to the expenditure of any qualified rehabilitation expenditure (as defined in section 47(c)(2)).

Section 7. Credit allowed

(a) General rule

(1) Tax credits for certain investments in the manufacture of generic drugs and biosimilars – There shall be allowed as an alternative to the credit under section 45BB(a), a tax credit against the tax imposed by section 901 of this chapter, equal to $1,000 for each qualified investment.

(2) Qualified investment; definition

(A) In general – For purposes of this section, the term “qualified investment” includes any property which is placed in service after December 31, 2026, and before January 1, 2033.

Section 8. Definitions

(a) Eligible taxpayer; definition

(1) In general – For purposes of this section, the term “eligible taxpayer” has the meaning given to it by section 4(a).

(2) Qualified facility; definition

(A) In general – For purposes of this section, the term “qualified facility” has the meaning given to it by section 48F(b)(3).

Section 9. Treatment under other laws and regulations

(a) General rule – The credit allowed under this section shall not apply to any qualified investment for which no deduction is allowable under section 168 or section 197(a).

(b) Coordination with rehabilitation credit

Section 10. Effective date and applicability

(a) Effective date

(1) In general – This section shall apply to property placed in service after December 31, 2026.

(2) Applicability to certain expenditures

(A) In general – The preceding sentence shall not apply to the expenditure of any qualified rehabilitation expenditure (as defined in section 47(c)(2)).

Section 11. Conforming amendments

(a) Section 46

(1) In general – This subsection shall not apply to paragraph (6).

(2) In general – The preceding sentence shall not apply to paragraph (7).

(3) Addition of new section 48F

(A) In general – Section 46 is amended by adding at the end a new subsection (h)

Section 12. Effective date and applicability

(a) Effective date

(1) In general – This section shall apply to property placed in service after December 31, 2026.

(2) Applicability to certain expenditures

(A) In general – The preceding sentence shall not apply to the expenditure of any qualified rehabilitation expenditure (as defined in section 47(c)(2)).