WASHINGTON (Gray DC) - Tax reform could leave a federal incentive for rare drug development on life support.
“Even when he was having a bad day, he would still always find a way to make me laugh,” that’s how Sharon Ponce remembers her son Cody. He lost his battle with a rare disease in 2015, but his mother’s still fighting in the search for cures.
She said she came to Washington D.C. this week because others still have time. “I feel that I need to advocate on their behalf and be their voice,” she said.
Cody died from complications of Fibrosing mediastinitis – a rare disorder that affects the areas between the lungs. The strain of the disease and constant surgeries proved to be too much for him to overcome. “Pretty much his heart gave out,” Ponce said.
Like many rare diseases, there’s no cure yet for Fibrosing mediastinitis. With relatively few people affected by rare disease – the federal government currently offers substantial tax breaks for companies that develop drugs. The idea is to make it financially worthwhile for drug companies to do research the market may not demand.
House lawmakers voted to cut it though as part of tax reform. Ponce questions the decision, “is any cost worth a person’s life?”
The Senate is considering scaling it back. Sen. Chuck Grassley (R-Iowa) said one of the tax credit’s original authors – fellow republican Sen. Orin Hatch (R-Utah)-- assured him the change won’t be problematic. “I don’t think that that should be considered [a] concern,” Grassley said when asked about reducing the benefit.
Jamie Love – the director of Knowledge Ecology International -- said the credit is flawed. “What you see with the tax bill though is kind of ham-fisted,” he said.
Love said the change will slow drug development but should not increase costs for patients when therapies are available.
He says tax reform shouldn’t eliminate the credit, but it should be tweaked by attaching strings to it. Love said which companies get the benefit should be public information. That’s an idea that is in the Senate’s plan, but not the House’s.
Love said those that do benefit from the credit should also be required to make it affordable in exchange for the Government’s investment. Some rare disease drugs carry million-dollar-plus price-tags for a year’s supply.
Finally, Love said drugs that are already approved for more common treatments, and highly- profitable shouldn’t be eligible. He argues too many companies are currently cashing in on it. “It’s just become people feeding at the trough,” he said.
Spokespeople for the National Organization for Rare Disease said they’re open to tweaks. But, they argue it does make sense for best-sellers like Humira to receive a benefit, because it could be the difference between whether alternate uses are tested at all.
A Senate vote on the whole package tax reform package is expected later this week.