A recent commentary (A Sarpatwari et al NEJM 2019; 381: 106-8) details the need for reforming the Orphan Drug Act (passed in 1983). To promote drugs for rare diseases, this act offered incentives including exclusive marketing rights for 7 years, a 50% tax credit for costs with clinical testing (reduced to 25% in 2017) and grants for clinical trials.
The problems that need to be addressed related to this act:
- Soaring drug prices
- “Slicing indications”
- “In 2017, the 100 best-selling rare-disease drugs had an estimated mean annual cost of more than $147,000 per patient, about $116,000 higher than that of the 100 best-selling drugs for other diseases.” One of the most recent drugs for spinal muscular atrophy is priced at $2.1 million per patient.
- 22% of these rare disease drugs have a non-rare disease indication (including Humira (adalimumab)). This has led to concerns that manufacturers are slicing indications to secure the statutory benefits.
- The authors argue that several of these favorable provisions need to be scaled back for blockbuster medications.
My take (borrowed from the authors): “The status quo increasingly threatens public health, as rising drug prices present growing access challenges for patients and indication slicing hampers collection of critical preapproval information on safety and efficacy when used in ways that will reflect their most common use in the market.”
Related blog posts:
- Orphan Drugs –Very Profitable
- Annual Costs: Generics vs. Brand-Name Medications
- WSJ: How Pfizer Settled on $9,850 per Month for New Drug
- Drug Waste Costing Billions. Pharmaceutical Companies Benefit
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