Rep. Scholten Introduces Bipartisan Bill to End Tax Breaks for Drug Ads, Focus on Affordability and Innovation

May 9, 2025 Press Release WASHINGTON, DC – U.S. Congresswoman Hillary Scholten (MI03), alongside Reps. Greg Murphy, M.D., Angie Craig, and Nick Begich,
introduced the bipartisan No Handouts for Drug Advertisements Act , which would no longer allow for-profit drug companies
to receive special tax breaks for the advertising of their products. “I’m committed to
rooting out waste and abuse in our budget at every turn, and this is a big
one,” said
Rep. Scholten. “This bill alone would cut our federal deficit by
billions annually. Families in West Michigan and across the country are feeling
the pinch of rising health care and prescription drug costs, and every dollar
spent on TV ads is a dollar not going to lowering drug prices or funding
life-saving research. The No Handouts for Drug Advertisements Act is a smart, bipartisan step
to lower health care costs and rein in waste in our budget.” By removing the tax
deduction for ads, the No Handouts for Drug Advertisements Act would help curb wasteful
spending and increase federal tax revenue—an estimated $1.5
to $1.7 billion annually from just ten of the largest pharmaceutical companies.
These are the kinds of bipartisan solutions that should be considered by
Congress, rather than the proposed drastic cuts to Medicaid. For nearly one
in four Americans, affording medication is a struggle. While drug
companies rake in tens of billions, millions of Americans are forced to decide
whether to skip doses or stop taking their medications altogether, simply
because they cannot afford the prescriptions they need. The United States is
one of only two countries in the world that even allows direct-to-consumer
pharmaceutical advertising at all. These marketing campaigns drive up consumer
demand for costly, brand-name medications—often when cheaper or more appropriate
alternatives are available—without improving health outcomes. In 2023 alone,
pharmaceutical spending in the U.S. rose 13.6% compared to the previous year,
reaching a staggering $722.5
billion . Drug companies currently spend around $6
billion per year on advertising. ###