New Study Examines Orphan Drug Exclusivity and Pricing
A new report commissioned by the National Organization for Rare Disorders (NORD) and published by the IQVIA Institute demonstrates that the 7-year market exclusivity granted to drugs designated under the Orphan Drug Act of 1983 for rare diseases is working as intended. In nearly every case, orphan exclusivity did not inappropriately prevent generics and biosimilars from entering the market. Instead, the lack of generic competitors can be credited to their prospective return on investment being too small.
Major Report Findings
The report offered the following findings:
- Adding an orphan indication to an on-market drug does not correlate with a higher-than-average price increase. The average price of therapies grew at a slower pace in 8 out of the 10 years following the addition of an orphan indication to the label.
- Of the 503 approved therapies with an orphan indication at the time the research was conducted, 217 are no longer covered by orphan exclusivity or patent protection. Of these 217 therapies, 116 have generic or biosimilar competition.
- The median spending on the 101 orphan drugs without protection from competition and without competitors is only $8.6 million per year per drug.
- About one-quarter of orphan drug approvals target populations smaller than 5,000 patients in the United States.
- Since 2009, on-market common-disease drug prices have grown more every year, on average, than orphan drugs.
“The data show that the 7-year market exclusivity provision is working as intended as an incentive for developing rare disease therapies and is not being abused,” said NORD's President and Chief Executive Officer, Peter L. Saltonstall. “The NORD-sponsored study illustrates that the dilemma of rising drug prices in our country should not be attributed to orphan drugs. It is my hope that this report will provide empirical data necessary to make informed decisions.”
More than 7,000 rare diseases have been identified, affecting a total of 25 million to 30 million Americans. Many affect only a few hundred or a few thousand individuals.
Disclosure: The study authors’ full disclosures can be found in the report at https://www.iqvia.com/-/media/iqvia/pdfs/institute-reports/orphan-drugs-in-the-united-states-exclusivity-pricing-and-treated-populations.pdf?_=1546619244598.
The content in this post has not been reviewed by the American Society of Clinical Oncology, Inc. (ASCO®) and does not necessarily reflect the ideas and opinions of ASCO®.
