Is a bioresorbable surgical implant like Seprafilm IM -- an internal adhesion barrier that dissolves in the body over time -- exempt from Texas sales tax as a prosthetic device?

Plain-English summary

A taxpayer asked the Comptroller whether a medical product called Seprafilm IM is exempt from Texas sales tax. Seprafilm IM is a bioresorbable membrane, cut to size or overlapped with other pieces, that surgeons place as a physical barrier between tissues in the abdominopelvic cavity during surgery to prevent them from adhering to each other as they heal. It adheres to moist tissue and turns into a gel, staying in place during the period when post-surgical adhesions could form, and is then bioresorbed by the body -- no follow-up surgery is needed to remove it.

The Comptroller confirmed the product is exempt: Texas Tax Code § 151.313(a)(4) exempts "prosthetic devices" from sales tax, and Rule 3.284(a)(10)(C) specifically includes devices that are implanted in the body within that definition. Because Seprafilm IM is implanted in the body, it qualifies for the prosthetic-device exemption.

Note on scope: the letter's subject line, as published, also references two other product names -- Instrasite Gel and Normgel -- but the response text the Comptroller actually provided discusses only Seprafilm IM by name and facts. This summary does not extend the ruling's conclusion to those other named products, since the Department's visible analysis addresses Seprafilm IM specifically.

What this means for you

Medical device sellers and distributors

An implanted product doesn't need to be a traditional rigid prosthesis (like an artificial joint) to qualify for Texas's prosthetic-device exemption -- a bioresorbable gel/membrane that's surgically implanted and later dissolves in the body still counts, because Rule 3.284(a)(10)(C) defines "prosthetic device" by the fact of implantation.

Hospitals and surgical facilities purchasing implantable barriers or films

Check whether a given implanted product is genuinely placed inside the body (as opposed to used externally or as a surface dressing) -- that implantation fact is what the exemption turns on here.

Accountants and tax professionals

This letter is grounded narrowly in Seprafilm IM's specific facts (a resorbable, internally implanted adhesion barrier). Don't assume every product named in a letter's subject line was independently analyzed -- only rely on the products and facts the Department's response text actually addresses.

Common questions

Q: Are all implanted medical devices exempt from Texas sales tax?
A: This ruling confirms that a device implanted in the body qualifies as a "prosthetic device" under Rule 3.284(a)(10)(C), which is exempt under Tex. Tax Code § 151.313(a)(4). Whether a specific product counts as "implanted" depends on its own facts.

Q: Does this exemption require the device to be permanent?
A: No -- Seprafilm IM is designed to be bioresorbed (dissolve) after doing its job, with no removal surgery needed, and it still qualified as an exempt prosthetic device once implanted.

Q: Does this ruling also cover Instrasite Gel and Normgel, which are named in the subject line?
A: The Department's actual response text discusses only Seprafilm IM's facts; it doesn't separately analyze those other products, so this summary doesn't extend the holding to them.

Q: Can I rely on this letter for a similar implanted product?
A: No -- it's based on the specific facts presented for Seprafilm IM, and different facts (even for a similar-sounding product) could yield a different answer.

Citations and references

Statutes and rules:

• Tex. Tax Code § 151.313(a)(4) (prosthetic devices exemption)
• 34 Tex. Admin. Code Rule 3.284(a)(10)(C) (devices implanted in the body are prosthetic devices)

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/9701188L

Original ruling text

January 24, 1997

FAX ***

Dear***:

This is in response to your letter dated January 14, 1997, concerning the
taxability of a new medical product called Seprafilm IM. Thank you for
providing the literature on the product.

Facts: The product, Seprafilm IM is a bioresorbable membrane that can be cut to
a specific size or overlapped with other Seprafilm IM membranes to provide an
effective physical barrier between potentially adhesiogenic tissues in the
abdominopelvic cavity. It adheres to moist tissue surfaces, turns into a gel.
Seprafilm IM remains in place during the period when postsurgical adhesions can
form and subsequently is bioresorbed; no further surgery is necessary to remove
it.

Response: Texas Tax Code Sec. 151.313(a)(4) exempts prosthetic devices and Rule
3.284(a)(10)(C) includes devices that are implanted in the body as prosthetic
devices.

When the product called Seprafilm IM is implanted in the body, it qualifies
for exemption as a prosthetic device.

This opinion is based on the facts presented and current law. Different facts
although similar, may result in different answers.

If you have any questions or need more information, you may call me toll free
at 1-800-531-5441, ext. 50330. The direct line is 512/475-0330. You may also
write to Tax Policy Division, Comptroller of Public Accounts.

Sincerely,
Bettie Peterson
Tax Policy Division