Camp proposes to repeal Orphan credit

Rep. David Camp (R-Mich.) released a discussion draft of sweeping draft tax reform legislation that includes a proposal to repeal the 50% tax credit for clinical development costs of Orphan drugs. Camp is chairman of the U.S. House of Representatives Ways and Means Committee. According to the explanation of the discussion draft, the repeal of the Orphan tax credit would increase tax revenue by $9.1 billion over 2014-23.

The draft bill also proposes to make permanent, with some modifications, the R&D tax credit, which would reduce tax revenues by an estimated $34.1 billion through 2023. Additionally, the bill would limit an existing tax exemption on income from research performed for the government or for universities and hospitals to only research that is made publically available, which would increase revenues by an estimated $700 million through 2023. The discussion draft also includes a provision to repeal the medical device excise tax, a 2.3% tax on the sale of certain medical devices mandated by the Affordable Care Act. Repealing the excise tax would decrease tax revenues by $29.5 billion through 2023. ...