Unlocking Opportunities in Puerto Rico: Proposed Legislation to Boost Medical Supply Chains

The medical supply chain industry faces significant challenges, including high costs and logistical inefficiencies. Two bills currently under consideration in Congress could offer important solutions, particularly for businesses operating in Puerto Rico or looking to expand their presence there. These legislative proposals aim to encourage investment in infrastructure and economically distressed areas, transforming how medical products are manufactured and distributed.

H.R. 8504 – Supply Chain Security and Growth Act of 2024

The first bill, H.R. 8504, the Supply Chain Security and Growth Act of 2024, proposes a 40% tax credit for investments in critical supply chain facilities located in U.S. territories like Puerto Rico. This credit would apply to property and equipment placed in service after December 31, 2024.

The proposed tax incentive is designed to facilitate the establishment of logistics hubs or warehouses in Puerto Rico, particularly for distributing pharmaceuticals and other cold-chain products. These facilities could not only reduce shipping costs but also improve delivery times, offering a competitive edge in the market.

S.33 – MMEDS Act of 2023

The second bill, S.33, known as the Medical Manufacturing, Economic Development, and Sustainability Act of 2023 (MMEDS Act), focuses on revitalizing economically distressed areas. It provides a 40% tax credit for wages, benefits, and property depreciation related to medical product manufacturing facilities in such zones. Additionally, it offers incentives for manufacturers to purchase products or services from suppliers located in these areas.

If Puerto Rico qualifies as an economically distressed zone, this legislation could encourage the construction of warehouses or logistics centers, strengthening the island’s role as a critical hub for the pharmaceutical industry. It would create opportunities for manufacturers seeking tax benefits and for businesses aiming to become strategic partners in the medical product supply chain.

The Potential of Puerto Rico

Puerto Rico already plays a vital role in the global pharmaceutical industry, particularly in manufacturing medical products. The enactment of these laws would further enhance its strategic position by providing tax advantages for expanding logistics and storage infrastructure. This would lead to more efficient distribution of medical products in the region while reducing reliance on costly shipping from the mainland United States.

Why These Bills Matter

These legislative proposals have the potential to create jobs, boost local economies, and strengthen the medical supply chain in the United States and its territories. However, since both bills are still in the early stages of the legislative process, support from the industry and stakeholders is critical to their advancement. Engaging with lawmakers and highlighting the benefits of these proposals could make a significant difference in their progress.

Stay Informed and Get Involved

To track the progress of these bills, you can find more information here: H.R. 8504 – Supply Chain Security and Growth Act S.33 – MMEDS Act of 2023.

These proposals represent a unique opportunity for the medical supply chain industry to rethink its logistical and investment strategies in Puerto Rico. This is an important topic that could significantly transform the landscape for companies involved in manufacturing, distributing, or storing medical products.