Orphan drug costs proving ‘prohibitive’

A GP’s view: Orphan drug costs ‘prohibitive’

“Orphan drugs are designed to treat rare, life-threatening or debilitating medical conditions known as orphan diseases.

In America, rare is defined as affecting less than one in 1,500 of the population, in Europe the figure is less than one in 2,000.

In 1983, the US Orphan Drug Act was enacted to boost research into orphan diseases.

Pharmaceutical companies invest billions of pounds a year in research and development

It was believed that, without incentives, manufacturers would not cover the costs of an orphan drug’s development. A number of incentives were therefore designed to increase their development.

In the US, these include the selling of the drug without competition for seven years, tax incentives, and an accelerated approval process. In Europe, approval fees are reduced, the European Medicines Agency offers administrative assistance and orphan drugs gain market exclusivity for 10 years.

By 1983, only 38 drugs in the US were approved to treat such diseases. By 2010, 352 orphan drugs were approved: one-third for cancer.

Some of these drugs have certainly gone on to earn more than their costs of development. Approximately one in 10 has generated more than £620m of revenues.

Nine of the most expensive drugs on the market, which cost more than £125,000 a year, treat diseases afflicting fewer than 10,000 patients. Companies are free to charge whatever they want during that seven-year period of market exclusivity.

Read More at the BBC

Dr Carl Heneghan

See the program underpinning this work on BBC Scotland. Investigates: Life, Drugs and Enormous Amounts of Money is on BBC One Scotland at 10:35 on Wednesday 16 January, and for a week afterwards on the BBC iPlayer.

1 Comment

  • Genpharm

    April 1, 2013 at 4:54 pm Reply

    Had the opportunity to watch the program a while ago; great insights.

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