Is Synvisc (hylan G-F 20), a knee-osteoarthritis injection, exempt from NY sales tax?

Plain-English summary

The petitioner asked whether Synvisc (hylan G-F 20) is taxable. Synvisc is an elastoviscous, high-molecular-weight fluid of hylan polymers derived from hyaluronan (produced from chicken combs). In an osteoarthritic knee, the natural synovial fluid breaks down and stops cushioning the joint; a physician injects Synvisc to supplement the knee fluid, relieve pain, and restore the knee's shock absorption. Synvisc is not recognized as a drug in the U.S. Pharmacopeia, Homeopathic Pharmacopeia, or National Formulary, and the FDA classifies it as a device.

The Office of Counsel concluded Synvisc is exempt. Tax Law 1115(a)(3) exempts "products consumed by humans for the preservation of health." When injected, Synvisc supplements the knee's synovial fluid, improving the operation of the knee and thereby maintaining the patient's mobility. It is therefore a product consumed for the preservation of health and is exempt (20 NYCRR 528.4(b)(3)).

What this means for you

Sellers and distributors of joint-injection therapies

Like the related Orthovisc, Euflexxa, and Hyalgan opinion (TSB-A-12(16)S), Synvisc is exempt as a product consumed for the preservation of health -- the exemption turns on its health-preserving function (restoring joint fluid and mobility), not on whether it's technically a "drug" (it isn't recognized in the Pharmacopeia) or how the FDA classifies it (a device). If you sell hyaluronan/hylan knee-osteoarthritis injections, you generally don't charge New York sales tax.

Common questions

Q: Is Synvisc taxable in New York?
A: No. It's exempt under 1115(a)(3) as a product consumed for the preservation of health.

Q: It's not in the Pharmacopeia and the FDA calls it a device -- does that change anything?
A: No. The exemption applies because Synvisc is consumed for the preservation of health (supplementing knee fluid and maintaining mobility), regardless of the drug-vs-device classification.

Q: Are other hyaluronan knee injections treated the same way?
A: Yes -- the companion opinion TSB-A-12(16)S reached the same result for Orthovisc, Euflexxa, and Hyalgan.

Citations and references

• Tax Law section 1105(a) (tax on retail sales of tangible personal property)
• Tax Law section 1115(a)(3) (exemption for products consumed for preservation of health)
• 20 NYCRR section 528.4(b)(3) (products for preservation of health)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_2012.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a12_1s.pdf

Original ruling text

New York State Department of Taxation and Finance

Office of Counsel
Advisory Opinion Unit

TSB-A-12(1)S
Sales Tax
February 9, 2012

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S110607A

The Department of Taxation and Finance received a Petition for Advisory Opinion from
name and address redacted. Petitioner asks whether a substance known as Synvisc is subject to
sales and use tax. We conclude that Synvisc is exempt from tax under Tax Law section 1115(a)(3)
on the ground that it is a product consumed by humans for the preservation of health.
Facts
Synvisc® (hylan G-F 20) (“Synvisc”) is an elastoviscous high molecular weight fluid
containing hylan A and hylan B polymers produced from chicken combs. Hylans are derivatives of
hyaluronan (sodium hyaluronate). Hylan G-F 20 is unique in that the hyaluronan is chemically
crosslinked. Hyaluronan is a long-chain polymer containing repeating disaccharide units of Naglucuronate-Nacetylglucosamine.
Currently, patients suffering the pain of osteoarthritis can receive a therapeutic injection of
Synvisc at a physician’s office and feel better. In knees with osteoarthritis, the joint fluid (called
synovial fluid) can break down and not provide the cushioning the knee needs. Synvisc
supplements the knee fluid to relieve the pain and improve the knee joint’s natural shockabsorbing abilities.
Synvisc is not recognized as a drug in the United States Pharmacopeia, Homeopathic
Pharmacopeia of the United States, or National Formulary. The U.S. Food and Drug
Administration (FDA) classifies Synvisc as a device.
Analysis
Section 1105(a) of the Tax Law imposes sales tax on the sale of tangible personal property.
As pertinent here, section 1115(a)(3) of the Tax Law exempts from sales and use tax (1) drugs and
medicines intended for use, internally or externally, in the cure, mitigation, treatment or prevention
of illnesses or diseases in human beings, and (2) products consumed by humans for the
preservation of health, but not including cosmetics or toilet articles notwithstanding the presence of
medicinal ingredients therein. When injected into the knee, Synvisc supplements the knee’s
synovial fluid, thus improving the operation of the knee, and thereby maintaining the patient’s

-2-

TSB-A-12(1)S
Sales Tax
February 9, 2012

mobility. Accordingly, Synvisc is a product consumed by humans for the preservation of health
and is exempt under Tax Law section 1115(a)(3) (see 20 NYCRR § 528.4[b][3]).

DATED: February 9, 2012

NOTE:

/S/
DEBORAH R. LIEBMAN
Deputy Counsel

An Advisory Opinion is issued at the request of a person or entity. It is limited to the
facts set forth therein and is binding on the Department only with respect to the person
or entity to whom it is issued and only if the person or entity fully and accurately
describes all relevant facts. An Advisory Opinion is based on the law, regulations, and
Department policies in effect as of the date the Opinion is issued or for the specific
time period at issue in the Opinion. The information provided in this document does
not cover every situation and is not intended to replace the law or change its meaning.