On Jan. 3, 1983, the Orphan Drug Act was passed by the U.S. Congress with the leadership of Rep. Henry Waxman, to stimulate development of drugs and biological products for the treatment of rare diseases. The Act encouraged the research and development of drugs for rare or “orphan” diseases defined as a disease or condition that affects fewer than 200,000 Americans.

The law provided 7-year marketing exclusivity to sponsors of approved orphan products, a tax credit of 50 percent of the cost of conducting human clinical testing, and research grants for clinical testing of new therapies to treat orphan diseases.