An orphan drug is a drug that treats a rare disease. In the U.S., a disease from which fewer than 200,000 is defined as rare. A Humanitarian Use Device is one from which no more than 4,000 patients will benefit.
It is very difficult to attract investment in innovation in these areas, because it is very difficult for entrepreneurs to earn a profit. Starting in 1983, U.S. law has provided incentives to promote more investment. The recently signed Food and Drug Administration Safety and Innovation Act contained a number of improvements to these policies.
Unfortunately, these reforms are unlikely to achieve the goals desired by their enthusiastic supporters - the topic of this month's Health Policy Prescription, which you can read here.