Orphan Products: Hope for People with Rare Disorders : Part 2

by Food and Drug Administration (FDA)

(Page 2 of 2)

Markets and Incentives

Though Congress defined a patient limit of 200,000 for orphan disorders, most of these conditions occur at well below this statutory ceiling. In 1992, 47 percent of designated orphan diseases affected an estimated 25,000 or fewer people. Some disorders, such as infant botulism and severe combined immunodeficiency syndrome, have patient populations of less than 100. Such numbers underscore how small the market — and the moneymaking potential — can be. But add in the act's incentives, and the picture changes dramatically.

The most powerful incentive is the act's marketing exclusivity clause, says FDA's Haffner. Once an orphan drug is approved, exclusivity gives sponsors legal protection against introduction of an identical competing product for seven years. This "shelter" is critical to keeping many companies interested in orphans, she says.

"Large firms need exclusivity to convince management to invest capital," she explains. "And small-to-medium-sized companies need it to ensure stockholders that the product won't be infringed upon by competitors."

Among other provisions for orphan-designated products are:

Grants — The act funds a total of $12 million worth of clinical research grants annually. Each grant may cover as much as $200,000 of direct costs per year for up to three years. The grants provision is aimed not at large companies but at smaller, research-oriented organizations. So far, six approved orphan drugs have come from the grants program, and several more are in clearance. Since 1983, FDA has awarded $67 million in research grants (another $12 million is earmarked for fiscal 1995 distribution).

Protocol assistance — FDA helps orphan sponsors design research that conforms to regulatory requirements and shows them how to deal with the FDA review system. Sponsors, especially small companies with little regulatory experience, can save time and money using this service.

Tax credits — A sponsor may claim 50 percent of clinical trial costs as a credit against taxes owed.

The act also bolstered orphan development by "lessening disincentives," says PhRMA's Copmann. For example, he says, pharmaceutical firms may use the act's marketing exclusivity provisions to enter these smaller, "niche" markets. "When [manufacturers have] the capability of finding a niche and have market protection, you've removed a disincentive."

In another example, Copmann cites biotechnology companies whose products are unpatentable under current law. These firms can gain a "quasi-patent" under the Orphan Drug Act's marketing exclusivity provision. Without this protection, many of these companies probably would not pursue orphans.

On the Horizon

Typically, FDA approves orphan products much more quickly than products aimed at potentially huge markets. "Because orphans serve a smaller population, they require less data; thus it's possible to have a fairly quick approval," says Haffner. She says the agency hopes to speed things up even more in the future, while still making sure safety and efficacy requirements are met. She points to the December 1993 approval of the cystic fibrosis treatment Pulmozyme (dornase alfa), which was approved in eight months, as an example of how the process can be "amazingly rapid."

Some in the orphan diseases community say FDA approval still takes too long. To that, Haffner responds that the agency may aim to speed approvals, but it won't take shortcuts. "You have to know why evaluation can take time," she says. "The bottom line is that the American public will not forgive FDA if we send out a potentially harmful drug."

NORD's Meyers says she'd like to see "a bigger dent" made in the number of orphan diseases that have no treatments. Still, she says she is pleased that orphan development is progressing steadfastly. NORD, she says, will continue to participate in legislative issues, to monitor health reform, and to work with the pharmaceutical industry and government to promote orphan concerns.

Copmann also sees orphan development advancing steadily. PhRMA's Commission on Drugs for Rare Diseases, he says, currently has eight promising orphan drugs "looking for parents." Copmann says new technologies may prompt novel treatments for orphan disorders.

FDA's Office of Orphan Products Development plans over the next three years to help sponsors develop treatments for very small patient populations, including those with rare genetic diseases, says Haffner. The next decade, she adds, should bring a broadening of the act's scope. "Often, pregnant women, children, senior citizens, and others are excluded from usual clinical trials when orphan products are being developed. Our goal is to include these individuals so we can increase the number of patients benefiting from the act and ensure that the number of approved orphan products continues to grow."

About the Author

www.fda.gov
FDA is A United States government body that oversees medical devices, including contact lenses, intraocular lenses, excimer lasers and eyedrops. In the US, these products must be approved by the FDA before they can be marketed.