Sustainable rare diseases business and drug access: no time for misconceptions

Abstract

Legislative incentives enacted in Europe through the Regulation (EC) No. 141/2000 to incentivize orphan drug development have over the last 12 years constituted a powerful impetus toward R&D directed at the rare diseases population.However, despite therapeutic promises contained in these projects and significant economic impact linked to burgeoning R&D expenditures, the affordability and value of OMPs has become a topic of health policy debate in Europe fueled by the perception that OMPs have high acquisition costs, and by misconceptions around pricing dynamics and rare-diseases business models. In order to maintain sustainable patient access to new and innovative therapies, it is essential to address these misconceptions, and to ensure the successful continuation of a dynamic OMPs R&D within rare-diseases public health policy.Misconceptions abound regarding the pricing of rare diseases drugs and reflect a poor appreciation of the R&D model and the affordability and value of OMPs.Simulation of potential financial returns of small medium sized rare diseases companies focusing on high priced drugs show that their economic returns are likely to be close to their cost of capital. Research in rare diseases is a challenging endeavour characterised by high fixed costs in which companies accrue substantial costs for several years before potentially generating returns from the fruits of their investments. Although heavily dependent upon R&D capabilities of each individual company or R&D organization, continuous flow of R&D financial investment should allow industry to increasingly include efficiencies in research and development in cost considerations to its customers. Industry should also pro-actively work on facilitating development of a specific value based pricing approach to help understanding what constitute value in rare diseases. Policy makers must reward innovation based upon unmet need and patient outcome. Broader understanding by clinicians, the public, and policy makers of the complexity of clinical programs to deliver OMPs to market is required to better comprehend the decisions needed and made by industry. In parallel, an overt effort to consider the impact of public policies on R&D investments is key to enable policy makers to better reconcile the incentives provided by public policy decisions and companies investments decisions in a more positive manner.

Principles for consistent value assessment and sustainable funding of orphan drugs in Europe

“…OMP funding is contentious, primarily because of the sometimes high per-patient cost of OMPs (although some OMPs have similar prices to non-OMP drugs) [ 54 ]. It is generally accepted that the small patient numbers in rare diseases mean that the cost per patient of OMPs is likely to be higher than treatments for more prevalent conditions [ 55 ].…”

“…It is generally accepted that the small patient numbers in rare diseases mean that the cost per patient of OMPs is likely to be higher than treatments for more prevalent conditions [ 55 ]. This is inevitable if manufacturers are to recoup research and development expenditure and be incentivised to develop treatments for rare diseases [ 54 - 57 ].…”

Clinical Trials

“…For example, pituitary adenomas registries (like Acromegaly) developed in Europe, in order to establish best management: standardized diagnosis and treatment, including imaging, blood sampling and assays used, surgery and radiotherapy in specific disorders (9,10). European Network for the Study of Adrenal Tumors (ENS@T), orphan disease network (Orphanet), are other examples of cooperation in basic and clinical research in rare diseases, including endocrine disorders (11). Increase of awareness for some disorders in the general population, development and increase of power of patient's organizations, as well as documented media are also important players to consider.…”

Disease awareness or subtle product placement? Orphan diseases featured in the television series “House, M.D.” - a cross-sectional analysis

“…The interest of larger pharmaceutical companies to explore and invest in the orphan drug sector is shown by figures made available by the European Federation of Pharmaceutical Industries and Associations. When comparing the sectors of research and development investment, the sector "Rare Diseases" ranks highest with 24.6% of total investments, followed by "Pharmaceuticals" (15.9%) and "Software and Computers" (9.8%) [17]. Two advantages of orphan drugs compared to non-orphan drugs have been scientifically analyzed and may, among others, be responsible for these investments: orphan drugs show a significantly shorter development time (4 years vs. 5.5 years from phase II trials to launch date) and a larger probability of successful approval (93% vs. 88%).…”