Gilead relinquishes orphan drug designation for potential COVID-19 treatment


Publish Date:
March 26, 2020
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Stanford Law School professor Lisa Ouellette questioned whether orphan drug exclusivity would meaningfully enhance Gilead’s pricing power during the pandemic and contends the outrage boils down to the 25% tax credit Gilead would receive. The Tax Cuts and Jobs Act of 2017 reduced the tax credit from its original value of 50%.

“It is much worse to set incentives for addressing this pandemic too low than too high,” Ouellette wrote in a blog post.

“The social cost of delaying access to a treatment – even by weeks or days – is huge; the cost of awarding an unnecessary tax credit to Gilead is just a transfer,” she added.