Do payers value rarity? An analysis of the relationship between disease rarity and orphan drug prices in Europe

Abstract

Background and Objective: Orphan drugs have been a highlight of discussions due to their higher prices than non-orphan drugs. There is currently no European consensus on the method of value assessment for orphan drugs. This study assessed the relationship between the prevalence of rare diseases and the annual treatment cost of orphan drugs in France, Germany, Italy, Norway, Spain, Sweden, and UK. Methods: Approved orphan drugs and prevalence data were extracted from the European Medicines Agency website. Annual treatment costs were calculated using ex-factory price. Simple regression was used to analyse the relationship between costs and prevalence. A specific bivariate analysis was performed for the rarest diseases (≤1 per 10,000). Results: 120 drugs were analysed. Prevalence ranged from 0.001 to 5 per 10,000 (mean 1.24, median 1). Annual treatment costs per patient ranged from €755 to €1,051,956 (mean €100,000, median €39,303). Results show a statistically significant inverse correlation between annual treatment cost and disease prevalence in all countries (France: r = −0.370, p = 0.002; Germany: r = −0.365, p = 0.002; Italy: r = −0.340, p = 0.002; Spain: r = −0.316, p = 0.041; UK: r = −0.358, p = 0.0004; Sweden: r = −0.414, p = 0.014; Norway: r = −0.367, p = 0.002). When analysis was focused on the rarest diseases, a stronger correlation exists in all countries (France: r = −0.525, Germany: r = −0.482, Italy: r = −0.497, Spain: r = −0.531, UK: r = −0.436, Sweden: r = −0.455, Norway: r = −0.466; all p < 0.05 except Sweden p = 0.077). Conclusions: This study shows an inverse correlation between annual treatment cost and prevalence with high statistical significance in the studied countries. Although pricing is a complex process where different attributes are assessed, this study supports the idea that payers value rarity in pricing decisions.

A Review of Rare Disease Policies and Orphan Drug Reimbursement Systems in 12 Eurasian Countries

“…The Netherlands defines the classification "orphan drug" as either having an official EU orphan designation or if it targets a disease with a prevalence of <1 in 150,000 and shows a clinically proven therapeutic benefit and no other registered medicine exists 5 .…”

“…Consequently, patient access is often unpredictable and restricted while reimbursement strategies for manufacturers are fragmented and complex. The high prices of many orphan drugs, often combined with a limited amount of clinical evidence (mainly due to small patient populations), can lead to Incremental Cost-Effectiveness Ratios (ICER) that exceed "willingness to pay" levels (5). Budget restriction measures, especially around "expensive drugs" (which OMPs often are), are increasingly common.…”

“…The reimbursement status of orphan drugs in Eastern Europe has been described by several authors recently (11)(12)(13)(14)(15). There have been multiple publications describing OMP policies in Central and Eastern Europe in single countries (16)(17)(18) or covering a larger number of countries in Europe (5,(19)(20)(21)(22). Pejcic et al focused on HTA and pricing as well as rare disease policies in 14 Eastern European countries (23).…”

Non-profit drug research and development: the case study of Genethon

“…In affluent societies, the exorbitant cost of advanced treatments, particularly in the segment of rare diseases, has placed increasing strain on the budgets of health care insurers and patients [2,4–10]. Even in European healthcare markets where national payers employ value-based frameworks to assist drug pricing decisions, orphan drugs achieve prices which fall much above typically used cost-utility thresholds [11]. Further, orphan drugs in Europe are purchased at a higher relative cost in lower income countries, due to differences in gross domestic product per capita [12].…”

Öffentliche Lenkung und Preisbegrenzung für Orphan-Drugs

“…Mit Preisen von durchschnittlich 142.000 €/Patient und Jahr in Deutschland [23] wurden trotz der Seltenheit mit OD bei 1,14-fach höherer Kapitalrendite ebenso hohe Jahresumsätze pro Medikament erwirtschaftet wie mit "non-orphan drugs" (US$ 637 Mio. vs. UD$ 638 Mio., [11,24] Da die OD-Entwicklung ökonomi-schen Gesetzen folgt und noch keine öffentliche Lenkung erfährt, ergab sich eine ungleiche Verteilung auf das Spektrum der SK: Onkologie (32 %), Infektiologie und "human immunodeficiency virus" (HIV; 12 %), Hämophilie (6 %), Kleinwuchs (2 %), pulmonale Hypertonie (2 %), Transplantation (2 %) und Sonstige 44 % [32].…”