Did the Chemoport implantable fluid-delivery system qualify as exempt medicine?

Plain-English summary

California treated the Chemoport portal-and-catheter system as taxable. It provided venous and arterial access for medication, fluids, parenteral nutrition, and blood sampling, but the source said it was never implanted for the six months then used as the permanent-implant threshold.

The system also did not replace or assist a natural body function and was not programmable. It therefore failed the permanent-implant, prosthetic-device, and programmable drug-infusion-device routes. The memorandum expressly withdrew the reasoning of an earlier contrary Mediport letter.

Common questions

Did the product name "implantable" make it exempt?

No. The opinion required the historical permanence threshold and found it was not met.

Did medication infusion make it a programmable infusion device?

No. The Chemoport provided access but was not itself programmable.

Citations and references

• California Revenue and Taxation Code section 6369(c)(2) — historical permanent-implant provision
• California Revenue and Taxation Code section 6369(c)(4) — prosthetic-device provision
• California Revenue and Taxation Code section 6369(c)(6) — programmable drug-infusion-device provision

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: https://cdtfa.ca.gov/lawguides/vol2/suta/425-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/425-0247.pdf

Original ruling text

State of California

Board of Equalization
Legal Division (MIC:82)

Memorandum
425.0247
To:

Audit Evaluation and Planning Unit (BDR)

From:

Mary C. Armstrong
Legal

Subject:

Prescription Medicines

Date:

July 5, 1989

This is in response to your memorandum of May 24, 1989 regarding the correct application of tax to the Chemoport Immplantable Fluid Delivery System. You have also questioned two previous rulings on the subject which gave two different results. (See letter of July 26, 29895 from Mr. Ray Greenhouse and letter of August 7, 1986 from Mr. Les Sorensen.) As we understand it, the Chemoport Implantable Fluid system is an implantable system consisting of a portal and catheter with a permanently locking connector. It allows for venous and arterial access for the infusion of medication, fluids, parenteral nutrition and sampling of blood. The Chemoport Implantable Fluid Delivery System is not an exempt medicine. It does not qualify as an implanted device under Revenue and Taxation Code section 6369(c)(2) because it is not permanently (i.e. for six months or more) implanted. It is not a prosthetic device because it does not replace or assist the functioning of a natural part of the human body. Additionally, it does not qualify as a programmable drug infusion device under section 6369(c)(6) because it is not programmable. The ruling previously given on the Mediport Implantable Vascular Access Port is incorrect. There may have been some confusion about how long these items are implanted. According to literature we have seen, the implantation would never be for six months or more. Mr. Sorensen’s letter dated August 7, 1986 is correct.

MCA:sr