CBO confirms unexpected costs of Orphan Cures Act

The Congressional Budget Office has handed congressional Democrats new ammunition to challenge the Orphan Cures Act, confirming that the law has unintentionally created a multibillion-dollar windfall for Merck, Bristol Myers Squibb and Johnson & Johnson.

Enacted as part of last year’s sweeping budget reconciliation bill, Orphan Cures was designed to fix an unintended consequence of the Inflation Reduction Act that had created a disincentive to invest in the development of drugs for very rare diseases. The IRA limited the exemption from Medicare price negotiations to products approved for a single orphan indication, a provision that patient advocates said discouraged investment in therapies for ultra-rare conditions...