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Economic Research demonstrates continued value in orphan drug act incentives

1.5 from 2 votes
Wednesday, October 09, 2013

NEW YORK, - New health economics research assessing the current impact of the Orphan Drug Act (ODA) suggests the law continues to play a crucial role in stimulating drug development for small patient populations. The descriptive study is presented this week as a poster at the 3rd Annual DIA-NORD Conference on Rare Diseases & Orphan Products in Bethesda, MD. Study authors Arielle Bernstein, MPP, vice president, Makovsky Health and research manager, Department of Pediatrics, Section of Hematology/Oncology, University of Chicago, and Rena Conti, PhD, assistant professor, Department of Pediatrics, Section of Hematology/Oncology, University of Chicago, will be on-hand to discuss their findings.

"While previous studies have found that research and development stimulated by ODA was concentrated in relatively large orphan disease populations – 100,000 patients or greater – this analysis shows that increasingly, small patient populations of 30,000 or fewer are benefitting from ODA designation and development," said Bernstein. "Another surprise finding is that most of the secondary indications received by the drugs studied were additional orphan indications – benefitting additional rare disease patients."

The descriptive study, titled "The Value of Rare Disease Drug Development: Evaluating Correlates of Market Entry for Orphan Drugs, 2009-2012," used empirical data to examine patient-, manufacturer- and molecule-level correlates of market entry for orphan-designated drugs approved between 2009 and 2012. Passed into law in 1983, the ODA aimed to incentivize innovation and investment in drug development for rare diseases (patient populations <200,000). However, critics have charged that firms may act on perverse incentives –securing orphan designation benefits for relatively prevalent conditions (patient populations >100,000), and/or strategically initiating approval in an orphan designation, before pursuing additional approval(s) for broad, non-orphan indications, in order to maximize profits while benefiting from ODA tax breaks.

"One of the most important questions about policies like the Orphan Drug Act is whether the economic incentives are working as intended to address a public health problem," said Conti, co-author of the study. "Thirty years after its implementation, our analysis suggests that the ODA is continuing to stimulate innovation and product approval, and that recent activity is related to conditions with small and even very small patient populations. This evidence suggests the ODA is continuing to meet its original objectives."

The analysis found that among the 86 total orphan-designated indications approved by FDA between 2009-2012, 33% were for cancer, 13% for genetic disorders, and 3% for infectious diseases; additionally, 9% of indications were approved for pediatric use. Among the approved orphan indications for which the researchers found reliable U.S. prevalence numbers (61 of 86 indications), 82% had an estimated patient population of fewer than 100,000. More specifically, 46% had an estimated patient population of fewer than 30,000.

The study also found that secondary FDA-approved indications were common among the 80 unique molecular entities approved during the time period studied, with 45% having more than one FDA-approved indication.

"The diverse backgrounds and strategic thinking of our people is what enables Makovsky Health to help clients navigate successfully complex regulatory, competitive, economic and policy environments," said Gil Bashe, executive vice president and Health Practice director, Makovsky. "Arielle's ongoing commitment to health economic research exemplifies the curiosity, rigor and commitment to, ultimately, advancing patient care that is shared by all of our Makovsky Health colleagues."

The findings of this study will be presented today at the 2013 U.S. Conference on Rare Diseases and Orphan Products in Bethesda, MD, the third annual joint conference of the Drug Information Association (DIA) and the National Organization for Rare Disorders (NORD).

About Makovsky Health

Makovsky Health is leading healthcare communications in its ongoing mission to improve the lives of patients served by biotech, pharmaceutical, wellness and device manufacturing companies. Honored as the 2012 Public Relations Agency of the Year, Makovsky campaigns have been recognized as the "Best in Healthcare," "Best Education/Public Service Campaign" and "Best of the Best." To learn more about the agency, please visit

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Source: Makovsky Health
1.5 from 2 votes
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