Criticism of the #OrphanDrug Legislation

In Uncategorized by Matt Turner

orphan drug legislation, pricing and reimbursement, rare diseases, market approvalOrphan drug legislation has widely been deemed a significant success in raising the awareness of rare diseases and spurring innovators and drug developers to increase their attention to the rare disease space. Nonetheless, there are those who deem the legislation as a platform to exploit the market and reap profits with premium prices dissociated with the nature of the industry. The summarised article written by Tony Hall, Chief Medical Officer of PSR Group below deals with criticisms of orphan drug legislation:

“The incentives contained in the orphan drug legislation are undoubtedly very important in stimulating companies to develop drugs for rare diseases which would otherwise be neglected. However, there seems to be a widely held belief that this legislation offers a mechanism by which medicines for rare diseases may be brought to market based on lower standards than for non-orphan medicinal products, and then sold at exorbitant prices, leading to criticism of this legislation. If correct, this would be contrary to the philosophy of the orphan drug legislation, which is based on the premise that “Patients suffering from rare conditions should be entitled to the same quality of treatment as other patients.” I will address these two points; that the orphan drug legislation permits lower standards and that it leads to unreasonable pricing.
Drugs for rare diseases may be granted a marketing authorisation (MA) based on studies with very few patients, sometimes only a single clinical trial may be performed and occasionally a sponsor may not perform any clinical trials, but base the application on published data. However, the mechanisms which make these routes to registration possible are not part of the orphan drug legislation, but are contained in other legislation which is, in principle, available to any drug. Similarly, MA under exceptional circumstances (when comprehensive data may be impossible to obtain) and conditional approval (when comprehensive data is not yet available) are available to any drug which meets the criteria, not just orphan drugs.

In order to obtain a MA, all drugs are expected to demonstrate safety and efficacy and the regulatory authorities will not accept inferior evidence just because a drug has orphan designation. Furthermore, orphan drugs must meet the same standards for nonclinical data (including toxicity) and must comply with the same standards of quality in the manufacturing as for non-orphan drugs.
Orphan drugs tend to be sold at significantly higher prices than medicines for common diseases and the orphan drug legislation has also been blamed for leading to “profiteering”. However, there is nothing in the orphan drug legislation which facilitates this and pricing is a matter for individual countries to determine. Indeed, the orphan legislation attempts to prevent profiteering by allowing that the period of market exclusivity “may be reduced to six years if, at the end of the fifth year, it is shown on the basis of available evidence that the product is sufficiently profitable not to justify maintenance of market exclusivity”.

In summary, the apparently “easier” rules by which many orphan drugs obtain a MA are not part of the orphan drug legislation, but are available to any drug which meets
the criteria. These regulations do not lead to lower standards, since the regulators require the same demonstration of quality, safety and efficacy as they do to classical development programs, but they recognise that it may not always be possible to obtain as much data. Once on the market, the price of an orphan drug is determined at a country level, by the applicable authorities.”

The World Orphan Drug Congress will be highly interactive 3 day congress that confronts these issues of pricing, reimbursement, market access and identifying the value of a rare disease treatment.