The Orphan Drug Act

Abstract

The 1983 Orphan Drug Act sought to increase market incentives and decrease regulatory barriers for products used to treat rare ("orphan") diseases. Major provisions included market exclusivity, tax credits, and regulatory process clarifications. This analysis compares pre- and post-Act industry and government data to examine changes associated with the law. While industry sponsored 34 marketed and 24 experimental orphan drugs in the 17 years prior to the Act, it has sponsored 39 of 42 marketed orphan products in the 7 years since the Act. An additional 301 experimental products have orphan designation. While 25 of 40 marketed orphan products reportedly had annual sales of less than $1 million, product sales for three conditions are more than $100 million annually. This prompted changes in the law, passed by Congress in 1990, but vetoed. Overall, the law has been associated with an increase in orphan product development. The law's costs and benefits to companies, patients, and the public should be examined if future changes are proposed. (JAMA. 1991;265:893-897)