Department of Health and Human Services, OFFICE OF INSPECTOR GENERAL  MAY 2001

PURPOSE:  The purpose of this inspection was to assess the implementation of the Orphan Drug Act of 1983 and its impact on industry and patients.

Congress passed the Orphan Drug Act of 1983 to stimulate the development of drugs for rare diseases. A rare disease is defined as a disease that affects fewer than 200,000 people in the United States. Prior to passage of this historic legislation, private industry had little incentive to invest money in the development of treatments for small patient populations, because the drugs were expected to be unprofitable. The law provides 7-year marketing exclusivity to sponsors of approved orphan products, a tax credit of 50 percent of the cost of conducting human clinical testing, and research grants for clinical testing of new therapies to treat orphan diseases. Exclusive marketing rights limit competition by preventing other companies from marketing the same version of the drug, unless they can prove clinical superiority.

Read more

Report of the National Commission on Orphan Diseases, 1989

By the US Department of Health and Human Services, February 1989

Read the report at: