* Allergan CEO: Proposed tax discriminates against women
* Tax would apply to Botox, Juvederm, breast implants
* Company lobbying to get tax out of healthcare bill
(Adds CEO, Senate comments)
By Lisa Richwine
WASHINGTON, Dec 11 Botox maker Allergan Inc
(AGN.N) is actively fighting a proposed U.S. cosmetic surgery
tax, but sees a marginal impact on the company, Allergan's
chief executive told Reuters on Friday.
Healthcare legislation pending in the U.S. Senate includes
a 5 percent tax on elective cosmetic surgery procedures,
nicknamed the "Botax" after Allergan's popular wrinkle-fighting
The impact would be "pretty marginal" for Allergan overall,
CEO David Pyott said in an interview.
He said adding 5 percent to the average $440 cost of a
Botox procedure would have a "very marginal" impact on demand,
but could have a "larger" effect on breast implant procedures
that cost upward of $5,000, he said.
Still, the company is lobbying to have the tax killed
because "we really feel strongly this is bad policy," Pyott
"I think it's a dangerous precedent. It's extremely
discriminatory against women," who make up about 90 percent of
cosmetic surgery patients.
"Why not have a tax on drugs for male balding or for
erectile dysfunction? Why are we picking on women?" he said.
Many patients are middle-class, working women and not just
the wealthy, Pyott said. He pointed to an American Society of
Plastic Surgeons survey that showed 60 percent of people
planning to have cosmetic surgery lived in households with
annual income below $90,000.
The tax in the Senate bill is estimated to raise roughly $5
billion over 10 years to help pay for a healthcare overhaul
costing $849 billion. It is not included in health legislation
that passed the House of Representatives.
Among Allergan's products, the tax would apply to Botox,
wrinkle filler Juvederm, eyelash drug Latisse and breast
implants, Pyott said.
The tax would apply to cosmetic procedures that are "not
necessary to ameliorate a deformity" related to "a congenital
abnormality, a personal injury resulting from an accident or
trauma, or disfiguring disease," according to the bill.
Sales of Botox rose about 3 percent in the third quarter to
$328 million following declines in previous quarters that the
company blamed on waning use of cosmetic procedures during the
economic downturn. Allergan's breast implant sales amounted to
$69 million in the third quarter.
Allergan would not pay the tax directly, but doctors would
be required to collect it from patients.
The company's lobbying efforts include a website and
Facebook page to rally tax opponents. The website calls the
plan "a tax on self-improvement."
More than 10,000 people have signed an online petition
opposing the tax and more than 7,500 letters have been sent to
senators, Pyott said.
The tax was added recently to the Senate healthcare bill as
lawmakers looked for new ways to help fund wider insurance
coverage and other changes.
"We needed money to make the bill work while using a
funding mechanism that would allow us to stay within the
healthcare arena," said Jim Manley, a spokesman for Senate
Majority Leader Harry Reid.
(Reporting by Lisa Richwine; editing by Andre Grenon)