Explain the significance of the Orphan Drug Act.

The Orphan Drug Act, enacted in 1983, is significant because it was created to encourage the development of drugs for rare diseases, which affect fewer than 200,000 people in the United States. The act provides a range of incentives for pharmaceutical companies, including tax credits for clinical research expenses, a waiver of the application fee for the new drug application (NDA), and seven years of exclusive marketing rights once the drug is approved for a specified condition.

This framework is essential because, before the act, there was little financial motivation for companies to invest in research and development for these less common conditions, leading to a lack of treatment options for patients suffering from rare diseases. By offering these incentives, the Orphan Drug Act has played a critical role in fostering innovation and expanding the available therapies for patients with rare diseases, ultimately improving healthcare outcomes for these individuals.