Plain Language Summary
# Cameron's Law Summary **What the Bill Does** Cameron's Law would increase the orphan drug tax credit from 25% back to 50% of qualified clinical testing expenses. This tax credit applies to companies developing drugs for rare diseases and conditions. In practical terms, if a pharmaceutical company spends $1 million on approved testing expenses for a rare disease drug, they could deduct 50% of that cost ($500,000) from their taxes, rather than the current 25% ($250,000). **Who It Affects** The bill primarily affects pharmaceutical and biotech companies that develop drugs for rare diseases.
The increased tax credit could make it more financially attractive for these companies to invest in rare disease treatments, which often have smaller patient populations and higher development costs. Patients with rare diseases could potentially benefit if the incentive leads to more drug development in their areas. **Current Status** The bill (HR 1414) was introduced in the 119th Congress by Representative Josh Gottheimer (D-NJ) and is currently in committee, meaning it has not yet been debated or voted on by the full House of Representatives.
CRS Official Summary
Cameron's LawThis bill increases the orphan drug tax credit to 50% (from 25%) of qualified clinical testing expenses paid or incurred in the development of drugs to treat certain rare diseases or conditions.As background, the Tax Cuts and Jobs Act reduced the orphan drug tax credit (for tax years after 2017) to 25% of qualified clinical testing expenses (e.g., wages, supplies, and certain contract expenses) paid or incurred in the development of drugs to treat certain rare diseases or conditions. For 2017 and prior tax years, the orphan tax credit was 50% of such expenses paid or incurred.
Latest Action
Referred to the House Committee on Ways and Means.