Dyskeratosis congenita (DC) is a pediatric bone marrow failure syndrome caused by germline mutations in telomere biology genes. Mutations in DKC1 (the most commonly mutated gene in DC), the 39 region of TERC, and poly(A)-specific ribonuclease (PARN) cause reduced levels of the telomerase RNA component (TERC) by reducing its stability and accelerating TERC degradation. We have previously shown that depleting wild-type DKC1 levels by RNA interference or expression of the disease-associated A353V mutation in the DKC1 gene leads to decay of TERC, modulated by 3'-end oligoadenylation by noncanonical poly(A) polymerase 5 (PAPD5) followed by 3' to 5' degradation by EXOSC10. Furthermore, the constitutive genetic silencing of PAPD5 is sufficient to rescue TERC levels, restore telomerase function, and elongate telomeres in DKC1-A353V mutant human embryonic stem cells (hESCs). Here, we tested a novel PAPD5/7 inhibitor (RG7834), which was originally discovered in screens against hepatitis B viral loads in hepatic cells. We found that treatment with RG7834 rescues TERC levels, restores correct telomerase localization in DKC1 and PARN-depleted cells, and is sufficient to elongate telomeres in DKC1-A353V hESCs. Finally, treatment with RG7834 significantly improved definitive hematopoietic potential from DKC1-A353V hESCs, indicating that the chemical inhibition of PAPD5 is a potential therapy for patients with DC and reduced TERC levels.