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Policy and Legal

President Biden Gets to Work, and the NAM Responds

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As President Joe Biden took office yesterday, the NAM took a pragmatic stance, calling this new political era “a time for healing.” As NAM President and CEO Jay Timmons put it, “Today, manufacturers recommit ourselves to be part of the solution—to be part of the healing process. We invite all Americans to join us in doing the same.”

And since the new president started his first day with a flurry of executive orders, the NAM responded to those, too. Here’s a rundown of the new policies, plus the NAM’s statements.

Immigration: While also moving to reverse a ban on immigration from certain Muslim-majority countries, President Biden strengthened the Deferred Action for Childhood Arrivals program, offering support to the so-called Dreamers. He called on Congress to pass comprehensive immigration reform that provides Dreamers with permanent status and a path to citizenship.

  • Responding to the DACA action, Timmons said, “Manufacturers are very encouraged by today’s critical first step. . . .  The broad goals of the Biden plan align with many of the core recommendations in ‘A Way Forward,’ manufacturers’ post-partisan roadmap for immigration reform. The path we have laid out is one that we believe can bring the country together, and we look forward to working with the Biden administration to move a comprehensive immigration reform plan through Congress.”

Keystone XL: President Biden also rescinded the permit for the Keystone XL pipeline, at least temporarily erecting a barrier to its progress.

  • “Manufacturers are disappointed with the administration’s decision to block this sustainable project, which can serve as a model for infrastructure of the future, and if not reconsidered, represents a missed opportunity for manufacturing workers in America,” said Timmons. “Manufacturers have a strong commitment to responsible environmental stewardship, and protecting our environment does not require us to walk away from his job-creating opportunity.”

COVID-19: Ten executive orders focused on combating the COVID-19 pandemic, according to CNBC. The NAM had called for aggressive actions to support manufacturers’ COVID-19 response months ago, including in its April “American Renewal Action Plan” and, mostly recently, in conversations with the transition team.

  • The orders included a new COVID-19 response office as well as a pandemic supply chain resilience strategy to help strengthen domestic production of important supplies.
  • President Biden also restored U.S. membership in the World Health Organization and directed agencies to use the Defense Production Act to spur production of critical materials like N95 masks, swabs and other vaccine- and virus-related equipment.

“It’s very encouraging to see [President Biden] is starting off with strong, decisive action to fight COVID-19, save lives and get our economy on the road to recovery,” said Timmons on Twitter. “Manufacturers are committed to ending this deadly pandemic.”

Masks on: One of President Biden’s orders will now require masks to be worn on federal property, and he plans to require masks on public transportation as well. The NAM has prioritized face coverings since the beginning of the pandemic, including by launching a “Wear a Face Covering” ad campaign and providing a crucial estimate of how many masks American businesses need.

  • “President Joe Biden is showing real leadership with his executive orders on masks,” said Timmons. “Masks save lives, help us keep our economy open and are vital until we can all get vaccinated.”
Press Releases

Manufacturers Outline Executive Action Policy Priorities for Incoming Administration

Washington, D.C. – The National Association of Manufacturers called on President-elect Joe Biden to help ensure the future strength of manufacturing in America by extending key executive orders into the new administration and rescinding those that have harmed manufacturing.

“For decades, we have worked with policymakers from across the ideological spectrum to craft policies that encourage the growth of manufacturing in the United States,” said NAM President and CEO Jay Timmons in a letter to the incoming administration. “Now more than ever, America needs leaders in Washington who are focused on increasing American jobs, wages and investment.”

The letter outlines executive orders that have had a significant impact, positive or negative, on manufacturers over the past four years, and it urges the president-elect “to reverse the most harmful of these orders and keep or expand those that create an environment that is conducive to growing America’s manufacturing sector.”

The NAM’s recommendations will help manufacturers continue to respond to the devastating pandemic and will also power the United States’ economic recovery by setting the stage for manufacturing growth.

To read the full letter, click here.

Background:

The NAM has requested President-elect Biden repeal the following executive orders and consider executive orders for extension.

Executive Orders

Rescind:

  • “Rescission of the Deferred Action for Childhood Arrivals Program”
  • E.O. 13950 – “Combating Race and Sex Stereotyping”
  • E.O. 13672 – “Revocation of Federal Contracting”
  • E.O. 13769 – “Protecting the Nation from Foreign Terrorist Entry into the United States”
  • “President’s Report to Congress on the Proposed Refugee Admissions for FY 21”
  • Presidential Proclamation 10052 – “Suspending Entry of Aliens Who Present a Risk to the U.S. Labor Market Following the Coronavirus Outbreak”
  • E.O. 13944 – “Ensuring Essential Medicines, Medical Countermeasures and Critical Inputs Are Made in the United States”
  • E.O. 13948 – “Lowering Drug Prices by Putting America First”
  • E.O. 13957 – “Creating Schedule F in the Excepted Service”

Extend:

  • E.O. 13771 – “Reducing Regulation and Controlling Regulatory Costs”
  • E.O. 13805 – “Establishing a Presidential Advisory Council on Infrastructure”
  • E.O. 13766 – “Expediting Environmental Reviews and Approvals for High-Priority Infrastructure Projects”
  • E.O. 13845 – “Continuing the President’s National Council for the American Worker and the American Workforce Policy Advisory Board”
  • E.O. 13932 – “Modernizing and Reforming the Assessment and Hiring of Federal Job Candidates”
  • E.O. 13777 – “Enforcing the Regulatory Reform Agenda”
  • E.O. 13806 – “Assessing and Strengthening the Manufacturing and Defense Industrial Base and Supply Chain Resiliency of the United States”
  • E.O.s – “Strengthening the Federal Government’s Anti-Counterfeiting Efforts”

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs more than 12.3 million men and women, contributes $2.32 trillion to the U.S. economy annually and has the largest economic multiplier of any major sector and accounts for 62% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

News

Say “Ahhh”: A Manufacturer Makes It Safe for Dentists to Reopen

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What do you do when a pandemic shuts down your customers? That was the problem faced by A-dec, a manufacturer of dental equipment and supplies based in Oregon, when dentists nationwide closed their doors back in March. 

In A-dec’s case, they developed products to help their core customers come back safely.  

The problem: Dentists and hygienists are at particular risk of contracting COVID-19 while treating patients, because their jobs require proximity to their patients’ open mouths.   

  • Dentists also use loupes with lights and magnifiers to see inside patients’ mouths—but wearing medical masks and traditional face shields makes it difficult to wear lighted loupes as well.  
  • Meanwhile, traditional face shields are open at the bottom—and because dentists work on patients who recline right below them, those shields provide limited protection. 

The solution: A-dec’s engineers got to work designing and producing a unique face shield for dentists that fits around the collarbone and opens upwards, providing a barrier between dentists and patient. The shield also leaves additional space around dentists’ eyes so they can use lighted loupes 

Image courtesy of Remote Area Medical

The process: The same pandemic that made this work necessary also made it difficult. A-dec had to overcome a series of complications:

  • Research and development: COVID-19 made the company’s customer focus groups impossible to do in person, so it designed and conducted remote focus group sessions. 
  • Sourcing of materials. Shortages and supply chain disruptions also caused problems, with some commodities becoming unavailable at the last minute. That meant A-dec faced delays and had to find alternate sources of materials at times 
  • Product construction. Like many other manufacturersA-dec had to figure out how to keep remote workers and on-site, socially distancing workers in sync with each other—all while creating a new product in record time.

By working around these setbacks and streamlining its processes, A-dec was able to go from the initial idea to the beginning of production in just two months—an extraordinary achievement.

The last word: According to A-dec Vice President of Manufacturing Wesley Snyder, the company benefited from its familiarity with medical regulations—but that doesn’t mean non-medical manufacturers can’t make a difference. “Everything is made by somebody, and the manufacturing industry is uniquely positioned to make tangible contributions to society in a crisis like this,” he said. So find those new points of need, and align them with your capabilities. 

Policy and Legal

The U.S. Needs Better Broadband Access

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Most of us are extremely grateful to have the internet nowadays—it keeps manufacturers’ high-tech operations running and provides entertainment for our socially distanced evenings. But the U.S. needs continued, substantial investment in broadband access and will do so long after the pandemic is over. One reason, of course, is that manufacturing is increasingly high-tech and high-skilled, which means demand will keep rising for fast, reliable and universal connectivity.

So in light of our renewed appreciation of all things digital, here’s a quick reminder of the policies that the NAM is promoting, courtesy of NAM Director of Innovation Policy Stephanie Hall. As she puts it, the federal government needs to take the following steps:

  • Modernize federal partnership programs and appropriate funds to increase broadband deployment in hard-to-serve areas and to close the digital divide.
  • Fund broadband mapping efforts to help us understand where broadband is needed and who needs it most.
  • Create a smart regulatory environment that allows the private sector to design, build, finance, operate and maintain our digital infrastructure.

Recent actions: The NAM—and manufacturers across the country—are calling on Congress to include broadband funding in its COVID-19 response. In a May letter to the Senate Committee on Commerce, Science and Transportation, the NAM asked Congress to “support investment in our broadband infrastructure system, maximize consumer choice in how they connect and reduce regulatory barriers that can slow manufacturers’ ability to deploy current and next-generation broadband infrastructure.”

As Congress continues to work on COVID-19 response funding, the NAM will keep pushing for broadband access.

Business Operations

Can Antibody Find Me…A Treatment for COVID-19

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Manufactured antibody treatments could be the next big thing in the fight against COVID-19, Reuters reports. The therapy is often used against illnesses like cancer, and a range of biotech companies are working together to test this approach.

Who’s involved: Several companies have been allowed by the U.S. government to combine resources to manufacture supplies, should any of the companies’ drugs succeed. Those companies include Eli Lilly and Company, AstraZeneca, Amgen and GlaxoSmithKline.

Meanwhile, The Wall Street Journal (subscription) reports on a Lilly study involving antibody drugs in nursing homes.

  • The study, which aims to enroll up to 2,400 subjects in nursing homes and other long-term care facilities, is intended to test whether the company’s antibody drug can reduce rates of infection.
  • If the study is successful, Lilly hopes its drug could receive government approval by the year’s end.

Go deeper: Revisit our recent writeup of an important new study on America’s effective policies for pharma development—and how these should be preserved.

Business Operations

Wearables Could Predict COVID-19

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Smart watches and smart rings are the newest COVID-19 detectors, according to The Wall Street Journal (subscription). Devices like Oura rings, Fitbits, Garmin fitness bands and Apple Watches pull in vital information that may predict an infection.

How it works: Tech companies are taking in wearable sensor data from smart sensors on both healthy people and those afflicted by COVID-19, comparing results and looking for patterns. They’re hopeful that they can use this information to create artificial intelligence that could alert people with early signs of the virus.

The metrics: There are a range of measurements that might help to detect COVID-19 early on, including:

  • Temperature tracking, which can help give early warnings about possible fevers;
  • Heart-rate tracking, which can reveal an infection early; and
  • Blood oxygen and cough tracking, which keeps an eye on specific COVID-19 symptoms.

Go deeper: Independent testing laboratory UL is at the forefront of these developments, and we recently talked to one of its leaders about how it’s helping to get such devices to market. Read the whole thing.

Business Operations

Cyber Criminals Take Advantage of COVID-19

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The internet may be saving our sanity (somewhat) with animal videos and Zoom chats . . . but there is a downside. With so much more happening online—such as retail and banking, not to mention all that working from home—hackers have a lot more targets.

The data depressingly bears that out:

  • Large data breaches have skyrocketed by 273% in the first quarter of 2020, according to data from cloud computing company Iomart.
  • Ransomware is up 90%, according to VMware, while attacks that destroy data or networks have risen 102%. And last, “island hopping,” in which criminals infiltrate one company in order to reach its partners or clients, is up 33%.

And here’s a worrying wrinkle: according to Iomart, manufacturing is one of the hardest-hit sectors.

There can be a grim benefit to cyberattacks, in that companies can learn from others that have already survived. To that end, aluminum manufacturer Norsk Hydro’s experience with a massive ransomware attack last year provides a number of (very) hard-earned lessons. From Bloomberg Businessweek (subscription):

  • After the attack, the company had to make sure its employees got paid—but banks wouldn’t connect digitally with the company due to fears of cyber infection. So one executive, at Hydro’s Brazilian location, copied the previous month’s paychecks from their external payroll system, weeding out employees who had left or been fired.
  • At a Pennsylvania plant, which lost access to corporate email and to the software that organizes its orders, employees received orders on their personal accounts. Then, having dug some old computers out of storage, they printed out the forms and distributed copies on the floor.
  • At headquarters, Hydro had to rebuild their entire network. They were so worried about keeping these plans safe that they barred cleaning staff from coming into the room.

Hydro’s leaders consider themselves lucky to have only lost $60 million to the attacks, which unfortunately tells you a lot.

NAM with a plan: Though manufacturers should certainly prepare for the worst, they can also take many steps to minimize, if not eliminate, the danger. The NAM provides many cyber-related resources for members, including most recently a new cyber-insurance program called NAM Cyber Cover.

And here’s good news: the NAM’s Cyber Forum, cosponsored by PwC and eSentire, is on for the fall, in a virtual format. It will be from 11:00 a.m. to 1:00 p.m. EDT on four Thursdays in a row: Oct. 1, 8, 15 and 22. To learn more, email [email protected].

Business Operations

The Latest News on Vaccines

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Here’s some good news: Moderna’s final-stage COVID-19 vaccine test began on Monday, according to The Wall Street Journal (subscription). The company’s researchers intend to conduct a nationwide, 30,000-person trial of its experimental vaccine, with the goal of testing whether two doses of the product can safely protect against COVID-19.

The timeline: Moderna is hoping that, with positive results, a vaccine could be available as early as this fall.

And more good news: Pfizer and German biotech BioNTech have also started their 30,000-person trials, which will extend around the globe. Their timeline? To get the vaccine into regulatory review by the fall.

So once a vaccine is ready, what happens next? A whole bunch of logistical challenges is what. The Atlantic details some of the complications involved:

  • A vaccine probably won’t offer complete protection, though it will prevent severe cases.
  • Production will be a challenge, with manufacturers seeking to make hundreds of millions of doses in record time and jockeying for supplies like glass vials.
  • Distribution will face major hurdles as federal and state governments are forced to coordinate vaccine delivery.
  • One in five Americans say they will refuse to get a vaccine even if it’s available, while nearly a third say they haven’t decided.

And one last PSA: STAT News gives us a heads-up that these vaccines may create some physical discomfort. That may actually be good news—the reaction could be a sign of your immune system going to work—but it’s probably best not to expect an entirely pleasant experience from a potentially lifesaving vaccine.

As always, your best bet for now is to follow CDC guidelines, wash your hands, maintain social distancing and wear a face covering.

Policy and Legal

Report: U.S. Leads in Pharma Innovation, Thanks to Effective Policies

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The new report from the ITI Foundation offers strategies to maintain U.S. strength, spur greater innovation and increase domestic production.

U.S. policies spur success: “America still leads in innovation and drug development, in large part due to effective life-science policies, including significant federal investment in life-sciences basic research, robust intellectual property (IP) protections, effective technology transfer policies, investment incentives, and, importantly, drug pricing policies that enable companies to invest in high-risk drug development.”

Recommendations for policymakers: The paper suggests U.S. policymakers should focus on four key areas:

  • Maintaining U.S. strength in pricing, tech transfer and intellectual property—and avoiding oppressive drug price control schemes that damage competitiveness;
  • Boosting innovation through investment and additional tax incentives that promote research and development;
  • Increasing domestic production, including via tax credits and additional funding for key research institutions; and
  • Combating foreign mercantilism by making sure that America’s trading partners pay their “fair share” for new drugs, treatments and other medical products.

Innovation in the time of COVID-19: At a time when U.S. pharmaceutical companies are central to the fight against a global pandemic, the ability to innovate successfully is of paramount importance. The U.S. House Committee on Energy and Commerce held a hearing on Tuesday that discussed the issue, titled “Pathway to a Vaccine: Efforts to Develop a Safe, Effective and Accessible COVID-19 Vaccine.”

The NAM says: “The research ecosystem we have in the United States supports a global leadership position of biopharmaceutical innovation,” said NAM Vice President of Infrastructure, Innovation and Human Resources Policy Robyn Boerstling. “Manufacturers are committed to building upon that innovation—but it’s clear that government-led pricing restrictions and importing bad health care policies used by our competitors is not the way forward.”

Related . . . The NAM has launched a new six-figure television and digital ad campaign aimed at potential rules to address drug pricing through International Price Indexing and drug importation.

Policy and Legal

Major R&D Bill Introduced in the House

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The new bill—an NAM priority introduced by Rep. Jackie Walorski (R-IN)—would boost the manufacturing industry’s ability to innovate.

The numbers: U.S. manufacturers spent more than $270 billion in R&D in 2018—or nearly two-thirds of all private-sector R&D.

The bill: Rep. Walorski’s bill would further support manufacturers seeking to invest in critical research and development, including:

  • Doubling the traditional R&D tax credit from 20% to 40%;
  • Doubling the alternative simplified tax credit from 14% to 28%; and
  • Making it easier for small businesses to access the R&D tax credit.

An NAM priority: The NAM has consistently pushed lawmakers to include R&D tax policies as part of additional COVID-19 legislation—including in a letter to congressional leadership last week. The NAM’s onshoring plan also calls for enhancing the R&D tax credit.

A word from the NAM: “The manufacturing industry is the backbone of American research and development,” said NAM Senior Director of Tax Policy David Eiselsberg. “This bill would support jobs, boost innovation and help ensure America’s future competitiveness.”

And speaking of NAM tax priorities . . . the Treasury Department sealed a major victory for manufacturers this week by finalizing a rule that will provide relief for manufacturers with high-taxed foreign income.

  • The problem: 2017’s tax reform created a new foreign minimum tax, which imposed a minimum 13.125% tax on foreign earnings. Due to the way the tax interacted with existing international rules, manufacturers with high-taxed foreign earnings could be subject to the new minimum tax.
  • The solution: Treasury adopted key NAM recommendations in its final rule, which creates an elective high-tax exception that would spare manufacturers from paying additional U.S. tax if foreign earnings are subject to a foreign tax rate greater than 18.9%. The rule represents an important step toward implementing the foreign minimum tax according to congressional intent.
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