Orphan Drug Act

Abstract

Orphan drug companies sit at the intersection of the public and private sectors, as various regulatory agencies and nonprofit organizations join to encourage the development of new treatments for rare diseases—about 6,000 mostly genetic ailments that, in sum, affect roughly one in ten Americans, or close to 25 million people. Congressional approval of the Orphan Drug Act (ODA) in 1983, and subsequent cooperation between a number of public and private institutions, have created more attractive protections and incentives for venture capital and private equity firms to invest in drug development targeted at “orphan diseases.”