#OrphanDrug exclusion from US drug tax – will this harm innovation on rare diseases?

In Uncategorized by Caroline Hornby

orphan drug and IRS exclusions Rare disease patients may be undermined by the US Internal Revenue Services’ issuance of temporary and proposed regulations implementing the annual pharmaceutical fee. This is according to the Plasma Protein Therapeutics Association (PPTA), who argues that the IRS proposal fails to take into account concerns expressed by leading consumer organizations and Congress, in particular in regards the agency’s narrow definition of an "orphan drug." The PPTA claims that the definition used by the IRS disproportionally affects the highly specialized segment of biological plasma protein therapies and puts the development of drugs and therapies for rare diseases at risk, the PPTA claims.

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"By creating an exemption to the fee for orphan drugs, as well as the long history of incentives initiated with the enactment of the Orphan Drug Act, there is clearly a longstanding congressional interest in encouraging the research and development of drugs and biologicals to treat rare diseases; however, the rule implementing the orphan drug exclusion from the fee fails to equitably treat all rare disease therapies," said Julie Birkofer, senior vice president, North America, PPTA.

Congress has legislation pending that would correct this problem. HR 2672 and S 1423, the "Preserving Access to Orphan Drugs Act of 2011," is a budget neutral solution that would provide the legislative relief needed to protect incentives for producing therapies for rare disease patients, says the PPTA.

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For more information on orphan drugs and rare diseases, check out the World Orphan Drug Congress USA.