Here are 4 things you need to know about the orphan drug industry between now and 2020
The orphan drug market is set to grow, and an increasing number of SMEs and pharma giants entering the Frey suggests that there is more to orphan drugs than juts a longer patent period.
In 2013 orphan drug sales increased by 6.8% to $90 billion. By the end of 2014 we can expect sales to total $97 billion, an increase of 7.3.%. This sees orphan products rise to account for 14.3% of world wide prescription sales. But the increases between 2013 and 2014 pale in comparison to the growth we can expect to see between now and 2020. With sales set to grow in double figures annually and an increasing portion of prescription sales being accounted for by orphan drugs, it’s no surprise that we can expect total sales to reach $176 billion annually for orphan drugs.
A 10.5% compound annual growth rate will see the prescription sales in the orphan sector grow at twice the rate of the overall prescription market which is set to grow at just 5.3% annually between 2014 and 2020. 2018 By 2020 orphan prescriptions should account for around 19% of global prescription sales, excluding generics. This will be an increase from the current level of 6.3%.
Got an orphan drug in development? Well there’s good news as the expected return on filed orphan drugs, or those in phase III is nearly twice as high at 1.89x greater than for non-orphans. in 2014 orphan drugs accounted for 20% of PIII clinical trial costs in the pharmaceutical industry. This is in contrast to the 32% of value attributed to orphan drugs over the same period. The difference here can be attributed purely to clinical trial sizes, with orphan drugs having on average just over 35,000 participants (an average of 731 patients per trials), in contrast to the 497,000 participants taking part in non-orphan trials (an average of 3,540 patients). Average phase III clinical trial costs for an orphan drug is $99 million (without any tax credit) Vs. $188 million for non-orphan drugs. With tax credits PIII trials could fall to nearly a quaurter the cost of a non-orphan phase III trial. The average net present value on the other hand is lower for orphan drugs ($1,005 million) compared to an NVP of $1,044 for non-orphan drugs.
Whilst phase III clinical trials may take just as long with orphans as with non-orphans, a median of 2.89 years, it takes the FDA on average 3 months less time to approve an orphan drug over a non-orphan drug. Whilst we see advocates and developers continually pushing regulators to change their approach to HTA and assessment of orphan drugs, there does seem to be evidence that the FDA is pushing through orphan approvals at a quicker pace than other applications. But whether this system will be able to cope with increasing numbers of market access applications for orphan drugs we are yet to find out, as approvals for orphan drugs have not gotten beyond a mere trickle in the US, and may well have stalled in the EU and Japan.
You can find our more about the orphan industry and projections towards 2020 from the Evaluate Pharma report here.