Cameron’s Law Would Restore the Critical Orphan Drug Tax Credit (ODTC), Enabling Future Innovation in Rare Disease Drug Development
Washington, DC – The Rare Disease Company Coalition (RDCC) supports H.R. 1414, Cameron’s Law, a critical bill that would restore the Orphan Drug Tax Credit (ODTC) to its original 50 percent. The RDCC thanks the bill sponsors, Representatives Josh Gottheimer (D-NJ-05), Don Bacon (R-NE-02), Jimmy Panetta (D-CA-19), and Tom Suozzi (D-NY-03) for their leadership on this important issue.
As Rare Disease Week approaches, Cameron’s Law will help spur rare disease research & development (R&D) encouraging more upfront investment in the pursuit of promising treatments for patients living with a rare disease.
The ODTC is a pillar of the Orphan Drug Act (ODA), a cornerstone of rare disease policymaking for over 40 years. Before the ODA was enacted in 1983, there were only 38 available treatments for rare diseases. Now, there are over 650 approved treatments – but with 95 percent of rare diseases still lacking an FDA-approved treatment, there is much more work to be done.
“For RDCC member companies developing life-changing treatments for rare diseases, it’s crucial to reduce the barriers to drug development and encourage upfront investment. Cameron’s Law will restore an integral component of the rare disease ecosystem and make it more economically feasible for drug companies to develop rare disease treatments and provide much-needed certainty for continued investment,” said Stacey Frisk, Executive Director of the Rare Disease Company Coalition. “The RDCC is proud to endorse this important bill and urges policymakers to ensure Cameron’s Law becomes law in the 119th Congress.”
The ODTC is a vital lifeline for rare disease patients. The tax credit promotes research for rare diseases by lowering qualifying development costs for manufacturers. It is an important incentive for companies working to find rare disease treatments, reducing the significant financial cost and risk that comes with the research and development of new therapies for small patient populations.
However, recent policy and regulatory changes – including the reduction of the ODTC by half in 2017 – have substantially reduced investments in rare disease companies. Recent research shows the trading index for rare disease companies has declined by nearly 7% per year over the last 5 years, compared to a 1.3% decline for non-rare disease companies. Rare disease companies saw nearly $10 billion less in investment available for research in 2022, stemming from decreases in venture capital investments, the IPO market, and partnership revenues.
The journey from bench to bedside is longer and more challenging for rare disease treatments than mass-market drugs, yet rare disease companies remain industry leaders in R&D investment. Both clinical- and commercial stage rare disease companies invest over twice as much in R&D as their non-rare counterparts. To stay afloat, however, small and emerging rare disease companies often rely on venture capital and outside investment as they pursue promising treatments, which can take 3 to 5 years longer than mass-market drugs.
The RDCC thanks the bill sponsors for their bipartisan leadership that will directly benefit the lives of the 1 in 10 Americans living with a rare disease – half of whom are children. The RDCC urges policymakers to ensure Cameron’s Law becomes law in the 119th Congress.
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About the Rare Disease Company Coalition (RDCC): Founded in May 2021, the Rare Disease Company Coalition represents life science companies committed to discovering, developing and delivering rare disease treatments for the patients we serve. As an education and advocacy-focused coalition of companies, our goal is to inform policymakers of the unique challenges and promises of rare disease drug discovery, development and manufacturing for small population sizes so that critical innovation can continue and positive changes can be enacted for the rare disease community. To achieve this goal, we will use our unified voice to advocate for long-term, consistent, equitable and sustainable government policies that enable life science companies to continue to bring hope and provide access to approved treatments to people living with rare diseases. For more information, please visit rarecoalition.com