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With high costs and small patient populations, how do we define the real value of drugs for rare diseases?

sheep_blackRecently there have been reports in the popular press and the BMJ regarding orphan medicines that have focused on their cost rather than their value. However it is important to gain an insight and some perspective into the need for orphan medicines, their use in orphan and rare diseases and the challenges faced by the patients who need them and the companies that develop them.

By definition, rare diseases affect only small numbers of individuals throughout the world, but it is estimated there are between 5,000 and 8,000 known rare diseases across the globe.

The NHS Constitution states boldly that: 'Everyone counts. We... make sure nobody is excluded or left behind.' However — and it is a very big 'however'— while governments want to see innovation and regard the development of orphan medicines as reflecting innovation, the reality is that patients often struggle to access such medicines once they are licensed. This is often because of a lack of awareness of orphan diseases among healthcare professionals and policy-makers, as well as funding and formulary challenges.

The big ticket
In an NHS environment where the focus is on the 'big ticket' areas such as heart disease and cancer, the common perception appears to be that money is better spent where it can provide the greatest RoI for the NHS, such as smoking cessation. So where does the priority lie for patients with orphan diseases, many of which are genetically acquired? How can the NHS genuinely ensure that 'nobody is excluded or left behind'? It is certainly true the financial pot is not limitless: resources are finite and difficult decisions must be made. However, we also need to reconsider the type of society we want to live in as well as the one we can afford.

To develop a perspective on the cost and value of orphan medicines, it is helpful to reflect on the general cost (and risk) of developing any innovative medicine, including those for orphan diseases. Some salient facts to be considered are that: the estimated cost of drug development, from discovery to launch, is approximately £550m; the pharma industry in the UK invests £10m on R&D every day; the development of a new pharmaceutical can take 10 years or more, and only five of 25,000 compounds tested in the laboratory are actually approved by regulatory authorities following clinical testing.

Data reflect the high level of risk and the very significant investment that is necessary before a company even begins the process of generating income for future innovation.

OMP legislation
The Orphan Drug Act (ODA), passed in the US in January 1983, is intended to encourage pharma companies to develop drugs to treat diseases with small patient numbers. Under the law, companies developing such medicines may sell them without competition for seven years. The EU has enacted similar legislation in which pharmaceuticals developed to treat rare diseases are referred to as 'orphan medicinal products', or OMPs. The EU's definition of an orphan condition is broader than that of the US, in that the EU definition also covers some tropical diseases that are primarily found in developing nations. The EU legislation is administered by the Committee on Orphan Medicinal Products of the European Medicines Agenecy (EMA). In an effort to reduce the burden on manufacturers applying for orphan drug status, the US Food and Drug Administration (FDA) and EMA agreed in late 2007 to utilise a common application process for both agencies.

Prior to a product gaining orphan status and marketing authorisation (where possible), patients often rely on the prescribing of unlicensed medicines as well as the off-label use of certain licensed medicines, where such medicines exist. Because these products are unlikely to have attracted significant investment for the licensed indication, their cost may be relatively low in comparison to treatments for the same conditions that are licensed. The licensing process is complex and is designed to ensure patient safety. When Orphan Medicinal Product Designation is awarded and the product is submitted for license approval, there are (quite correctly) a number of additional requirements for data, post-approval. This is because the quantity and quality of data surrounding the treatment of the condition is likely to be less substantive than for products treating much larger patient populations.

It is also likely to include the requirement for a Risk Management Plan that will allow clinicians to measure clinical outcomes over long-term use of the product, something the NHS is unable to invest in without the support of the manufacturer. Such a Risk Management Plan will often lead to further research into the relevant disease and will translate into more treatment options for patients. It also presents an ideal model of outcomes data collection for the NHS. This is not just patient monitoring but real research with major cost implications for the company. In this way, companies add value, not only to the treatments patients receive but to the medical understanding of the treatment of rare diseases.

Orphan challenges
Orphan drugs accounted for just 1.0 per cent of total drug spending in the UK in 2007. This small percentage reflects the challenges for the pharma industry in conducting clinical trials in small patient populations and generating sufficient income to reinvest. Other factors that should be taken into account are the appraisal mechanisms in place at national and regional level within the UK. The different approaches make it difficult for companies to navigate the funding landscape and there is increasing reluctance among companies to invest in clinical development in the UK, given the fact that there is no clear route to funding once an orphan medicine is approved.

The development of orphan drugs for patients with a rare disease is a costly process and one that requires incentives to balance against the risks. If the pharma industry really is to ensure that 'nobody is excluded or left behind', then policy-makers and payers need to recognise that the traditional methods of valuing these medicines do not apply.

Leslie Galloway
The Author
Leslie Galloway
is chairman of the Ethical Medicines Industry Group (EMIG)

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27th January 2011


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