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Business strategist Carol Roth on the impact of ObamaCare on medical-device manufacturers.
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Let's bring in business strategist -- -- Carroll is with us Carol you just what vice president vice president from cook medical had to say.
-- I don't think cook medical is unique far from a done things that par for the course in the medical device taxation industry.
Well absolutely Stuart we heard from striker in 2011.
That they plan to reduce their global workforce.
By about 5%.
In advance of this taxed to you because you have to remember one of my baby pet -- here is that taxes are being.
Communicated on a percentage basis their -- 2.3 percent -- that that in general revenue.
-- you have to remember with a fixed cost base that gonna have a huge impact on prop -- I think in the case of cook they're projecting about 15%.
On profits -- worry you to do appear come -- -- -- you know this was sold.
That it was put out in public this would be a a way to pay for Obama -- And -- it will be on things like -- new hit or a new joint in your elbow -- something.
But in fact.
-- is placed on the revenue was you correctly -- the revenue.
From Ole medical devices all -- has anything to do with -- met with medical.
That's something that he's made a physical tangible product there's a tax on the revenue coming in on it now that was surprising to me.
Now it isn't very surprising and one of the things that I can't stand about this is that it stifles innovation if -- -- new company that is out there.
Not only are the investors more wary because it's affecting their profits.
But even if you're not making one dollar profit you're still getting hit with this happen on the revenue because -- an excise tax on revenue.
So I think that.
You know why understand.
Why they have gone down this path you have to understand that the pendulum always swings the other way and -- if you if you do that's.
There's been always be an issue and I think that they've gone down the wrong path -- I'm gonna hall style question of books we have a trial lawyer witness who's name is -- and -- he's got a question for you hello Carol it's not a hostile one my question though is.
Why don't they just pass on the cost.
Put the plants in America and let us have the jobs just pass the costs -- -- the hospital and the hospitals get more money under obamacare.
Well.
You know -- there are different business decisions that have to be made and that certainly to the extent that they can't -- on those costs.
Is one option and I know that Medtronic is definitely looking at that but it from a business decisions standpoint.
You have to look at the whole of your business and there are a couple of different options.
And it as a business owner of its more profitable for you to seek international business.
That's one of the options that you're going to Brazil and I think that that the route that -- gonna go into their already.
In a couple of international countries and so they can expand their business by selling over there where there isn't attacks.
Then they're going to go ahead and do that.
Okay -- we appreciate you being with us thanks very much indeed I think is is an important developing national story I know it's interesting Jimmy -- it does sort of they're out some of John -- opinion that obamacare -- attacks -- well this certainly is -- -- this -- I don't clearly yes it's an act that I -- take your point.
That -- they could just pass this along.
And they will just pass it along -- a question about it yesterday -- beloved the past and along and and and the hospitals are the beneficiaries of obamacare they will be getting more money and that behind a couple of.
