The evolving orphan drug market: what does the future hold?

30-12-17DRG Admin

Patients with very rare diseases, in addition to the consequences of their disease, also suffer at the hands of market forces. The cost of developing drugs is high, and there is a small market for drugs for rare diseases. Without incentives, this market is consequently unattractive for pharmaceutical companies who must allocate their resources to areas where they can maximise the return on their investment. To combat this, governments have therefore enacted legislation to encourage orphan drug development and improve patient care.

Legislation was first enacted in the US in 1983 via the Orphan Drug Act, which granted tax credits, an accelerated approval process, and an additional 2 years market exclusivity to orphan drugs (drugs for diseases affecting <200,000 individuals nationally (1)) over non-orphan drugs (2, 3). Similarly, in 2000 the European Medicines Agency (EMA) enacted regulations granting 10 years market exclusivity for drugs for diseases affecting 5 in 10,000 of population in the EU (3, 4). However, a review process is now underway in the EU which could change these incentives.

The European Commission has commissioned a study on the ‘economic impact of supplementary protection certificates, pharmaceutical incentives and rewards in Europe’. In addition to examining paediatric regulations and the Summary of Product Characteristics process, this study will consider key provisions within the orphan drug approval and regulation process. While the study is not due to complete until Q1 2018, one key change to orphan drug regulations has already been implemented. Previously, if a manufacturer requested a type II variation to the indication for an orphan drug in the EU (expansion to another subgroup within the same disease), no reassessment of orphan drug status was required. However, this will now result in a requirement for maintenance reports and reassessment of the orphan drug criteria for the new subgroup. These criteria are:

  • The product must be intended for diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition
  • Prevalence must be less than 5 in 10,000 people in the EU
  • No satisfactory treatment for the condition exists, or if a satisfactory method exists, the new medicine has ‘significant benefit’ for patients

While the first two of these are unlikely to have changed substantially since the original marketing authorisation was granted, it is possible that the introduction of new treatments could make fulfilling the third criterion challenging. Demonstrating differences in efficacy will be highly challenging in orphan diseases due to the small available patient and clinical trial populations, and consequent scarcity of data. If a manufacturer fails to fulfil these criteria for the variation there are two likely possibilities; manufacturers can withdraw their application and submit separate marketing authorisations, one orphan and one non-orphan, or they will have to give up the orphan incentives for the drug altogether.

Successfully fulfilling these criteria is therefore vital for manufacturers, and payers interviewed for DRG’s European Access and Reimbursement solution (5) stress the importance of carefully considered clinical trial design in order to sufficiently demonstrate clinical benefit for orphan drugs seeking optimal access to the EU5 markets. While these payers were referring to national-level market access as opposed to orphan drug designation at the pan-European marketing authorization stage, their opinion is relevant to both. Including patient-relevant end points impacting disease progression and ensuring sufficient trial duration were specifically mentioned by payers across the EU5. Additionally, agents that showcase innovation will have a market access advantage, particularly in Italy, where innovation is an integral part of the health technology assessment (HTA) process, and in France, where highly innovative agents may attain early market access, and, consequently, the opportunity to garner real world data via temporary authorization (ATU) status. Furthermore, as emerging drugs for rare diseases with marketed treatment options progress through development, the bar will rise such that active comparators may become desirable, or indeed mandatory, if continued orphan drug marketing authorization and optimal market access are to be achieved.

The new EU process regarding type II variation is still shrouded in uncertainty, and it is not clear when exactly reassessment will be needed, what standards will be applied for determining ‘significant benefit’, or what will happen following a rejection. From a manufacturer’s point of view, the uncertainty around this change may make them more cautious about seeking indication variations. In addition, the possible future changes to orphan drug legislation could fundamentally change manufacturers’ approach to the orphan drug market. The creation of the Orphan Drug Act in the US radically changed the market at that time; only 34 orphan products had been marketed in the decade prior to 1983, however, 275 orphan drugs were approved by the FDA between 1983 and 2009 (3). While orphan drugs made up 16.4% of overall worldwide prescriptions in 2016 (6), the market is not yet mature and is primarily composed of small to medium companies who are more vulnerable to economic failure. Given that only 8.1% of the 1,706 drugs granted orphan status by the EMA between 2011–2015 actually reached the market (7), removal or reduction of incentives for orphan drugs could scare many companies away and discourage development of future orphan drugs. Notably, even orphan drugs that have garnered EMA approval have, collectively, met with mixed success in EU5 HTA due to country-specific variations in the HTA process.

Ultimately, it is patients who could be most affected by any drastic changes in legislation, with fewer drugs being developed, narrower indications, and less competition and choice. At DRG, our consultants can provide guidance on the development and global access requirements of drugs for orphan indications, be that strategic or tactical. Get in touch with our expert consultants at Access@TeamDRG.com to find out more.

Authors

Ewan Bennett, Principal Medical Writer

Janie Cox, Senior Director: Solutions, Market Access

Anna Reyes Trave, Market Access Analyst

References     

  1. United States Congress. Rare Diseases Act. 2002.
  2. Orphan Drug Regulations (57 FR 62076), December 29, 1992 and 21 CFR Part 316 et seq.
  3. Cohen JP, Felix A. Are payers treating orphan drugs differently? J Mark Access Health Policy. 2014;2.
  4. Baldovino S, Moliner AM, Taruscio D, Daina E, Roccatello D. Rare Diseases in Europe: from a Wide to a Local Perspective. Isr Med Assoc J. 2016;18(6):359-63.
  5. DRG Access & Reimbursement Report. European Access & Reimbursement: Orphan Drugs. 2017.
  6. Evaluate Pharma* 30 September 2015.
  7. Sola-Morales O. The Success Of EU Omp Legislation: An Empirical Analysis. Value in Health. 2017;20(9):A701.
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