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Sunday, September 9, 2018

Philly’s Spark Therapeutics Is Revolutionizing Medicine


The dogs told her it would work, back in 2000.
Jean Bennett had been a gene-therapy researcher for two decades at that point, starting with a lab at the NIH. She began, as many scientists do, wanting to conquer her field in a big way, believing that if the genetic bases for gnarly diseases could be identified, they could be fixed. She picked Alzheimer’s. It wouldn’t, Bennett soon discovered, be quite that simple. Nothing in gene therapy, she would find, is simple.
Eventually Bennett would partner with another researcher working on genetic disease in the retina. This wasn’t a disease like Alzheimer’s, but more straightforward: a genetic defect identified; a healthy gene cloned in a lab, then delivered within a virus that would be surgically implanted. Yet developing the process took years of research. Bennett worked with mice and with rabbits, whose eyes are closer in size and shape to human eyes. She got hired by Penn in 1992 as a professor in ophthalmology; her husband, Al Maguire, an eye surgeon at Children’s Hospital, helped in her retinal research, wheeling large lasers between Penn and CHOP. Penn Med was a hotbed then of gene-therapy research, led by Jim Wilson, who’d been brought in by über-aggressive CEO Bill Kelleyto build a cutting-edge lab with the best collection of genetic scientists, Jean Bennettbelieves, in the world.
Then, in 1999, disaster struck: An 18-year-old boy named Jesse Gelsinger died in a gene-therapy trial overseen by Wilson, and suddenly the whole field came to something of a standstill.
Quietly, Jean Bennett carried on. She could still tap some NIH money, and Penn didn’t put the kibosh on her research. She also had a stroke of luck: A co-researcher at Penn told Bennett about a blind Swedish briard dog that had been bred to produce puppies who were also blind. Bennett tested them and found the problem was with RPE65, the retinal gene she’d end up working on. Al Maguire injected three four-month-old puppies in one eye.
The change was rapid. Bennett got a call two weeks later to come see the dogs. She raced over. They’d been hesitant, nervous, blind. Now they bounced down the halls, tracking where they were going by turning their heads, using their treated eyes. Bennett was soon playing tag and fetch with Lancelot and his siblings.
“It was crystal clear at that point it was going to work,” Bennett says. “We had to figure out how to do it to help children.”
But it would take almost a decade before Bennett could conduct trials on children. Christian Guardino was one of the kids who received a new RPE65. A couple days following his surgery in 2013, when his eye patch was removed and he opened his eye, Christian said, “Mom, Papa? Is that you?”
It worked. And then it took another four years for the FDA to say yes.
Spark Therapeutics was formed in 2013, in collaboration with CHOP, to develop and market gene therapies. Late last year, the FDA approved Spark’s Luxturna, the first gene therapy green-lighted in this country that targets a disease caused by mutation in a specific gene – the cure for the rare retinal disease that Jean Bennett has been working on for the better part of two decades. It marked a turning point for gene therapy, and perhaps for Philadelphia as a center for it. Biotech is having a moment here: Also last year, the FDA approved a game-changing personalized cell-therapy treatment for leukemia developed by researchers at Penn and CHOP and marketed by Novartis.
There’s a new vibe in Philadelphia. Jim Wilson, still considered one of the foremost gene-therapy researchers in the world and still running his research lab at Penn, laughs about how one of his students is already planning to launch his own company. “He hasn’t even started grad school yet,” Wilson says. But that’s the new paradigm: from the lab to the marketplace. Wilson says new companies are nipping at his heels, siphoning off his researchers. He continually gets calls from investors.
In late June, Penn revealed it would be investing up to $50 million in biotech firms, with the proviso that the companies’ headquarters remain in Philadelphia, which is the linchpin in making this region a major player in biotech. The venture capital and support systems for nascent companies have typically been elsewhere, especially in Northern California and Boston.
It’s an interesting time for biotech in Philadelphia, as we seem to risk fighting our own nature. Steve Altschuler, who ran CHOP from 2000 to 2015, says, “Penn is still very conservative.” That $50 million gambit might suggest otherwise. But Altschuler says Penn declined an investment role in Spark, and that overall, the local biotech scene is moving in “fits and starts.”
The science is here, at any rate: Jim Wilson estimates that there are at least 1,200 scientists in the area working on gene and cell therapy. The problem is that we’re now a couple of decades into a pattern of fundamental research being done in Philadelphia, then being lifted to Boston or the Bay Area to make medical products. Biotech players bemoan the lack of venture capital betting on this city. Wilson works with five gene therapy companies in some sort of advisory capacity; none are headquartered here.
Spark, firmly entrenching in West Philly, may be about to change that trend.
If it’s possible to be intense and goofy at the same time, Kathy High has it nailed. I ask the Spark Therapeutics president and head of R&D about frustration – about how long it takes to get anywhere in the gene therapy world. “The way I think about it,” High, 67, says, “we’re blazing a trail, and I may not make it. I may be like Moses and never see the Promised Land.” Then she smiles her impish smile: “Medical journal editors don’t like me, because I try to put everything in a paper so somebody coming along knows what to look for.”
High would like to rid the world of hemophilia, and she’s close to making serious inroads in that direction through a gene-therapy treatment Spark is testing. Spark is really her baby – she’s the big scientific brain behind it – and it was High who gave Jean Bennett’sgene therapy the big push to the FDA finish line.
High also came to Penn in 1992, when she was offered the opportunity to do research in the Bill Kelley era. Around that time, she partnered with Avigen, a biotech start-up in Northern California. Avigen eventually got out of gene therapy, in part due to the cloud over the field after Jesse Gelsinger’s death, so High needed help. In 2004, she went to Steve Altschuler at CHOP with a request: She wanted him to fund her research. She needed Altschuler to invest some serious money in order for her to make clinical-grade vector-the vehicle to deliver corrective genes to hemophiliacs – in his hospital. Really, though, she was asking for a much bigger commitment than that. She’d need facilities and have to recruit scientists and trial designers from industry.
“I expected him to say no,” High says. Since Jesse Gelsinger died during a Penn trial, it would be particularly difficult to overcome the fear of gene therapy here. Gelsinger suffered from a rare metabolic disorder that wasn’t life-threatening; after he was infused with corrective genes, he had a chain reaction of multiple-organ failure, the cause of which was never pinned down.
But Altschuler knew High and her work – he’d been chair of pediatrics at Penn Med before moving to CHOP – and he felt gene therapy had made advances in knowledge and technique. He was ready to make a bold move, though it was a gamble. “Sometimes you’re not 100 percent sure,” Altschuler says.
In fact, it took only a week or so for him to say yes. Altschuler moved fast partly because the top scientists High wanted to hire were going to get picked off by somebody else – the irony of the Gelsinger cloud was that underemployed first-rate talent was available. Altschuler committed $50 million to a clinical center High would run.
But he had a stipulation: Her clinical work couldn’t revolve around just hemophilia. Altschuler had to be able to sell to the CHOP board and patients’ families and the public that his investment would help, first and foremost, children, and hemophilia isn’t necessarily thought of as a children’s disease. “I wanted to be able to say that we’re taking on a platform that could impact all genetic diseases of childhood,” Altschuler says.
Enter Jean Bennett, curing a form of blindness that affects children. High knew Bennett and her work, and bringing her on board would meet Altschuler’s need.
“Kathy knocked on my office door,” Bennett recalls, “and said, ‘Jean, how would you like to run a clinical trial at CHOP for retinitis pigmentosa?'” – trials, that is, on children, not mice or rabbits. “I was stunned, but not so stunned that I didn’t answer yes in a thousandth of a millisecond.”
There were still some major hurdles on the way to getting the FDA on board. One was the FDA’s assumption that surgeons would want to correct both eyes at once, which required Bennett to do more work with dogs to test out any unforeseen risks with that approach. Another was proving that the treatment would have positive real-life consequences – sight tests in blind children didn’t provide the necessary data. So Bennett and her team came up with an obstacle course, first for dogs, later for children, to be navigated pre- and post-surgery.
Clinical tests on children began in 2007, and over the next several years, the results were stunning. Among the success stories was Christian Guardino, who’d spent his childhood honing his singing in part because of limitations with his sight. Last year, Guardino took America’s Got Talent by storm, and when Simon Cowell gave him a standing ovation, he had a clear-eyed view.
If Steve Altschuler took a leap of faith in supporting Jean Bennett’s and Kathy High’sresearch, he took another when it came to launching Spark as a business enterprise. In 2011, Altschuler tasked Jeff Marrazzo with walking the halls of CHOP, trying to identify research and brainstorms that might fly commercially. Marrazzo, now 40, had gotten to know Altschuler in 2006 while working on a dual Wharton/Harvard degree in business and public policy. He’d go on to work for a biotech start-up for a short period. Marrazzo is a businessman who, he says, “fell in love with science.”
Kathy High, it turned out, was the last of 25 CHOP scientists Jeff Marrazzo met with as he searched CHOP for commercial opportunities. As the story goes – perhaps embellished, perhaps not – a one-hour meeting turned into seven hours. Marrazzo’s wife kept texting; he was due home in New York.
“I’m with Kathy,” he texted back.
“Who’s Kathy?”
After the conversation, Marrazzo challenged Steve Altschuler to create a business with High. Though there was risk, the timing was right once again. Altschuler felt CHOP was at a financial crossroads. Post-’08 recession, it would need funding beyond clinical care and NIH or other government support, and Altschuler believed CHOP could make money from its intellectual property. Jean Bennett’s retinal therapy was going into phase three, the final push for FDA approval, which would require a sizeable investment. Kathy High’s progress with hemophilia B looked promising. And gene therapy in general was moving forward.
Meanwhile, Kathy High was getting calls from Big Pharma and from investors, who were more and more interested in what she was up to at CHOP. High was leery of pharmaceutical companies. “They really walked away from gene therapy 10 years ago” – in large part because of Jesse Gelsinger’s death. “I was a little afraid for any of my programs to go to Big Pharma,” she says. “If they have a bad year … ” High smiles, as if all the trials, literal and otherwise, of getting drugs to the marketplace to help children are simply part of a vast puzzle she finds intriguing. But that amusement really masks her fierceness. Gene therapy is her calling. “Talking to Jeff, I thought we could really be a company. As other companies were forming up, they were raiding us all the time.”
The real-world proof that the FDA demanded – how did Bennett’s treatment make an actual difference in the lives of children? – became a video that was shown to the CHOP board and investors: a child who was once blind, navigating an obstacle course with ease.
“It is biblical,” Penn’s Jim Wilson says. “The blind man can now see.”
CHOP committed $50 million, and Spark was launched.
Spark Therapeutics, as of early July, has 342 employees. At the moment, it occupies three spaces in West Philly as it renovates the one-block building just west of 30th Street Station that housed the Philadelphia Bulletin. That, says Jeff Marrazzo, now the CEO of Spark, will be home.
Spark went public in 2015; Steve Altschuler, now head of its board, says CHOP has reaped $300 million selling its stock in the company and still owns about 10 percent, worth an additional $300 million. It has been, to say the least, a good investment – one that Penn missed out on.
Luxturna, in treating a rare form of blindness, won’t be a big moneymaker; so far, post-FDA approval, Spark has provided treatment for nine patients, at $850,000 each. The company’s market value is really, at this point, a bet on Spark’s FDA approval for a hemophilia A gene-therapy treatment; the market for all hemophilia treatments is in the $10 billion range, Altschuler believes.
Finally, the Jesse Gelsinger tragedy has subsided as a bugbear for the risks of gene therapy. But there are still some thorny ethical issues to consider. Since gene therapy as a medical tool is so new, how Spark or any other company would get a treatment for hemophilia A to the developing world, for example, is a big unknown.
As far as the potential of genetic modification to make us better, faster, stronger, that’s not a question of if, but when: “People say we’ll just fix diseases – are you kidding me? People in Philly pay $70,000 to get their kids in the right nursery school,” says Arthur Caplan, a longtime bioethicist at Penn who now works at NYU. The good news is, we’re not there yet: “We won’t be tweaking up the music or math gene in the next 10 years. But it’s coming.”
At any rate, there’s plenty on our doorstep right now. “We’ve got three target tissues,” Kathy High says in answering what’s on Spark’s plate, “the retina, the liver, and the central nervous system.” Spark is targeting the liver for hemophilia and Pompe disease and the CNS for Batten disease. All of these procedures are gearing up for the long trek toward FDA approval. “Also,” says High, “we’re working on a program for Huntington’s” – that smile betrays her again – “but we haven’t disclosed the strategy.”
The potential remains vast, and there’s another unanswered question: Is Spark the tipping point for Philadelphia in the biotech world? No one knows. But here we are, poised, as this city often seems to be, at the starting line.
Published as “Seeing the Future” in the September 2018 issue of Philadelphia magazine.

Saturday, September 8, 2018

Synthetic DNA vaccine effective against influenza A virus subtype


Currently available vaccines for the prevention of seasonal influenza virus infection have limited ability to induce immunity against diverse H3N2 viruses, an influenza A subtype that has led to high morbidity and mortality in recent years.
Now, Wistar scientists have engineered a synthetic DNA vaccine shown to produce broad immune responses against these H3N2 viruses. Study results were published online in the journal Human Gene Therapy.
The recent severe influenza seasons in 2013/2014, 2014/2015 and 2017/2018 can be directly attributed to H3N2. Commercial vaccine efficacy against H3N2 in 2017/2018 was low and contributed to a greater rate of pneumonia and influenza-associated deaths.
“Current vaccine design and manufacturing to meet the antigenic diversity of H3N2 viruses is challenging, and with another flu season approaching there remains a pressing need for new vaccine approaches for influenza,” said lead researcher David B. Weiner, Ph.D., executive vice president and director of the Vaccine & Immunotherapy Center at The Wistar Institute, and W.W. Smith Charitable Trust Professor in Cancer Research. “There is also a need for improvements in rapid selection and deployment against newly emergent viral strains and synthetic DNA vaccines represent an important tool to reach this goal.”
To overcome the antigenic diversity of H3N2 viruses, Weiner and colleagues used H3N2 strains from 1968 to the present retrieved from the Influenza Research Database to generate four synthetic common sequences of the hemagglutinin antigen (HA), a protein present on the viral surface. These micro-consensus sequences were used to generate four DNA vaccines that were co-mixed to create a cocktail vaccine labeled pH3HA. The scientists administered the vaccine or placebo to mice and a booster vaccine two weeks later. Two weeks after the booster injection, they inoculated them with two representative influenza viruses.
Sarah Elliot, Ph.D., a senior postdoctoral fellow in the Weiner Lab, and colleagues monitored clinical signs, body weight and survival for two weeks after infection. All mice immunized with the synthetic DNA vaccine developed broad, robust antibody responses against HA and effective cellular immune responses including CD4 and CD8 T cell responses.
They were protected against lethal influenza A infection from two different challenge H3N2 viruses. Vaccination with pH3HA induced robust antibodies against the 1968 pandemic H3N2 as well as contemporary H3N2 strains that were components of commercially available vaccines from 2015/2016 and 2017/2018.
Compared with those who received placebo, immunized mice survived intranasal virus challenge with 10 times the median lethal dose; the placebo group succumbed to infection within six days of exposure to the challenge virus.
“The pH3HA vaccine represents a unique micro-consensus approach to producing immune responses to antigenically related — yet diverse, seasonal influenza A H3N2 viruses,” Weiner said. “The overarching goals of this approach are to limit the number of vaccine reformulations that can be deployed to protect against novel H3N2 viruses.”
Story Source:
Materials provided by The Wistar InstituteNote: Content may be edited for style and length.

Journal Reference:
  1. Sarah Elliott, Amelia A. Keaton, Jacqueline D. Chu, Charles C. Reed, Bradley Garman, Ami Patel, Jian Yan, Kate E Broderick, David Weiner. A Synthetic Micro-Consensus DNA Vaccine Generates Comprehensive Influenza-A H3N2 Immunity and Protects Mice Against Lethal Challenge by Multiple H3N2 VirusesHuman Gene Therapy, 2018; DOI: 10.1089/hum.2018.102

Perrigo Gets Final FDA OK, Plans Launch for Store Brand OTC Imodium Equivalent


Perrigo Company plc (NYSE; TASE: PRGO) today announced that it has received final approval from the U.S. Food & Drug administration for the store brand over-the-counter (OTC) equivalent of Imodium®Multi-Symptom Relief (loperamide hydrochloride and simethicone tablets, 2 mg/125 mg). This product will be packaged and marketed as store brands or retailer ‘own label’ brands and will provide consumers with a high-quality, value alternative to the national brand. Perrigo is finalizing plans to launch its wholly owned store brand loperamide hydrochloride and simethicone tablets, 2 mg/125 mg, in the fourth quarter of 2018.

Imodium® Multi-Symptom Relief is indicated to relieve symptoms of diarrhea plus bloating, pressure and cramps, commonly referred to as gas. Retail sales for the last 12 months were approximately $62 million as measured by IRI.

Bayer officials ‘vague on lawsuit strategy, despite liability’


It’s been nearly three weeks since the merger between Bayer AG and Monsanto officially began its integration, about two months since the deal closed and nearly two years since the planned deal was announced.
Despite that, newly appointed Bayer officials are vague on how they plan to handle the mountain of lawsuits inherited from Monsanto over pesticides such as glyphosate and dicamba.
These lawsuits have plagued Monsanto, most recently in an August 10 court decision that ordered the company to pay $289 million in damages.
The nonprofit news outlet Midwest Center for Investigative Reporting provided this article to The Associated Press through a collaboration with Institute for Nonprofit News.
But at the recent Farm Progress Show in Boone, Iowa, Brett Begemann, Bayer’s new chief operating officer and former Monsanto executive, was non-committal on the newly integrated company’s approach.
Begemann highlighted that the companies had only been together for a short time because of the mandate by the U.S. Department of Justice that disallowed the two companies from making any plans until August 16.
“We continue to learn, just like any company, from feedback from our customers.” He said. “We’ll continue to listen to that feedback, engage in that conversation, look at additional research, and move on from there.”
Of the recent verdict over glyphosate, Begemann said it doesn’t change the way the company plans to move forward.
“I would look at that as one case – doesn’t change 800 scientific studies, it doesn’t change 40 years of use, it doesn’t change the incredible value that products brought to agriculture and consumers worldwide. We’re thoroughly supportive of the product and will continue through the legal process that’s available to us,” said Begemann. “It’s a horrible and unfortunate situation with the plaintiff, Mr. Johnson. We have great sympathy for him and his family, but Roundup does not cause cancer.”
After the August 10 decision against Monsanto, Bayer’s stock prices dipped 10 percent. That doesn’t bode well for future litigation against the newly merged company.
While Roundup, the commercial name for the chemical glyphosate, is the subject of more than 8,000 lawsuits against Monsanto, dicamba has only been in use for soybeans for three years. But in that time, it’s attracted 37 lawsuits over damage to crops.
Dicamba has been hailed as Monsanto’s solution to weeds that have become resistant to glyphosate in recent years, wreaking havoc on soybean fields across the Midwest. But as effective as it was on weeds, dicamba also has the ability to damage soybeans, cotton, and specialty crops that are not genetically modified to withstand the chemical.
By July of last year, university weed scientists estimated more than 2.5 million acres of soybeans had been damaged by dicamba, according to Dr. Kevin Bradley, professor of plant sciences at University of Missouri. By the end of 2017, that estimate would jump to 3.6 million acres. One dispute over damage in Northern Arkansas led to a man’s murder.
As a result, the Environmental Protection Agency placed greater restrictions on the chemical in early 2018, and eight states added further safety measures and training requirements. Monsanto cautioned against the application of reactionary restrictions.
“We sympathize with any farmers experiencing crop injury, but the decision to ban dicamba in Arkansas was premature since the causes of any crop injury have not been fully investigated. While we do not sell dicamba products in Arkansas, we are concerned this abrupt decision in the middle of a growing season will negatively impact many farmers in Arkansas,” Monsanto said in a 2017 statement.
The company argues that any damage was due to a failure by operators to follow the extensive label, which outlines proper use of the chemical, and not the fault of the company.
But a lawsuit filed by the National Family Farm Coalition in the U.S. Court of Appeals for the 9th Circuit claims the EPA’s two-year approval of dicamba in 2016 was unlawful, stating Monsanto influenced the registration process and the EPA didn’t follow the Federal Insecticide, Fungicide and Rodenticide Act and the Endangered Species Act.
As of July 15, 2018, the number of investigations into dicamba-related damage has dropped to 605, compared to the 1,411 reported by the same time in 2017. Weed scientists estimate 1.1 million acres of soybeans have been injured. But this doesn’t include numbers from key soybean producing states like Iowa and Wisconsin.
These numbers show a marked improvement from the damage in 2017, which can be attributed to stronger restrictions from the EPA and states, better training from the chemical manufacturers, or the increased sale of dicamba-resistant crops.
In 2017, Monsanto sold 25 million acres worth of dicamba resistant soybeans. In 2018, that number was expected to double to 50 million. That’s more than half the 89.5 million acres of soybeans planted this year.

Pfizer and CYTOO develop Duchenne target discovery platform


CYTOO has entered into a research and option agreement with Pfizer to develop a target discovery platform for Duchenne Muscular Dystrophy (DMD), through modifying CYTOOs existing MyoScreen platform.
DMD is a rare and life-threatening genetic disorder that affects children approximately 1 in 3500 to 5000 boys and families. It is caused by mutations in the dystrophin gene that results in progressive muscle degeneration and weakness.
By the early teens, most individuals with DMD have lost the ability to walk unassisted and their heart and respiratory muscles have also weakened. Individuals with DMD usually die from cardiomyopathy and respiratory failure in their second decade of life.
CYTOO has developed a muscle-on-a-plate platform using patients primary cells, called MyoScreen. MyoScreen is an in vitro system in which skeletal muscle cells mimic the morphology, contractile and metabolic functions of human muscle in vivo and therefore allows analyses of the molecular mechanisms involved in such functions in health and disease.
Under the terms of the agreement, Pfizer and CYTOO will work together to develop and validate a target discovery platform using a DMD patient muscle-derived MyoScreen platform. The goal of the collaboration is to attempt to establish a robust in vitro system that may be used for a high throughput target identification screen.
Should such a system be developed, Pfizer will have an option to acquire a license for the use of the resulting platform for DMD target identification efforts.
Dr John Murphy, VP, Biology, Pfizers Rare Disease Research Unit, said: Although the genetic cause of DMD has been known for years, little is known about the molecular functions that are affected in DMD muscles. Pfizer is committed to early stage DMD research and target identification.
Luc Selig, CYTOOs CEO, said: Muscle dystrophies affect children severely, and we still dont know what happens in muscle. This is why we developed MyoScreen: to have a laboratory model of patient-derived muscle, to study and modulate muscle functions and to identify drug candidates that are specific to muscle function. Teaming with Pfizer on DMD means they have shown a great dedication to this project, and we are extremely motivated to succeed.

Military $48 Million Federal Contract Awarded to Patterson Dental


Patterson Companies Inc. dba Patterson Dental, St. Paul, Minnesota, won a federal contract valued at up to $48 million from the Defense Logistics Agency for dental supplies and equipment.

Nearly half of Americans pay no federal income tax


Wage growth has risen to a 9-year high. Unemployment remains at an 18-year low. Jobless claims haven’t been this low since 1969. And nearly half of Americans don’t owe a dime of federal income tax.
Approximately 76.4 million or 44.4% of Americans won’t pay any federal income tax in 2018, up from 72.6 million people or 43.2% in 2016 before President Trump’s Tax Cuts and Jobs Act, according to data released Thursday by the Tax Policy Center, a nonprofit joint venture by the Urban Institute and Brookings Institution, which are both Washington, D.C.-based think tanks. That’s below the 50% peak during the Great Recession. They still obviously pay sales tax, property taxes and other taxes.
“The large percentage of people who don’t owe federal income tax is a feature, not a bug, of the revenue code,” according to the Tax Policy Center. “By design, the federal income tax always has excluded a significant fraction of households through a combination of personal exemptions, the standard deduction, zero bracket amounts, and more recently, tax credits.”
These workers who won’t owe any federal income tax include single people, married couples filing jointly and married individuals not filing jointly, said Gary Burtless, a senior fellow at the Brookings Institution. For the most part, they don’t earn enough money. However, many people who work and who don’t owe any federal income taxes still give money to Uncle Sam, because money comes out of their paychecks for Social Security and Medicare, he said.
“Many low- and below-average-income families pay more in payroll taxes every year than they pay in federal income taxes,” Burtless said. “This means you have to be careful describing the federal tax liabilities of U.S. families. The U.S. individual income tax is quite progressive, with much heavier tax liabilities as we move up the income distribution and very low or even negative income tax liabilities at the bottom of the income distribution.”
“Either their taxable incomes are below the threshold at which the tax unit’s ’taxable income’ exceeds zero,” he said, “or the taxpayer qualifies for refundable tax credits — such as the Earned Income Credit and/or the Child Tax Credit — that are greater than the amount federal income tax owed, in which case the tax filer receives a tax refund or owes no federal income tax liability. Much more rarely, high-income taxpayers have adopted tax strategies that occasionally eliminate their federal income tax liability.”

All but the top 20% of American families pay more in payroll taxes than in federal income taxes, according to Treasury Department data, cited by the Pew Research Center. “After all federal taxes are factored in, the U.S. tax system as a whole is progressive, according to Pew. “The top 0.1% of families pay the equivalent of 39.2% and the bottom 20% have negative tax rates. That is, they get more money back from the government in the form of refundable tax credits than they pay in taxes.”
On the other hand, payroll taxes are mildly regressive, Burtless said. “Individual earners do not pay any additional Social Security payroll taxes on earnings above $127,200 per year (in 2018),” he said. “The implication is that federal taxes overall are progressive, but they are far less progressive than the federal individual income tax system viewed all by itself.”
“The tax reform passed in December 2017 will no doubt affect the number of people and families who pay no federal individual income taxes and who pay no net federal income and payroll taxes,” Burtless added. The Tax Policy Center estimates that roughly one-third of workers who pay no federal individual income taxes receive a net refundable credits that covers their payroll taxes, including their employer’s share.
“About 60% of those who pay no income tax will work and owe payroll taxes,” according to Roberton Williams, an associate at the Tax Policy Center. “Most of the other 40% are retirees whose income is too low to owe income tax …Refundable credits make it possible for some low-income households with workers to avoid paying income and payroll taxes. Even so, nearly three-quarters of Americans will end up paying at least one of those taxes this year.”