Sarah Jane Tribble

The Food and Drug Administration is changing the way it approves orphan drugs after revelations that drugmakers may be abusing a law intended to help patients with rare diseases.

In a blog post Sept. 12, FDA Commissioner Scott Gottlieb, MD, said he wants to ensure financial incentives are granted “in a way that’s consistent with the manner Congress intended” when the Orphan Drug Act was passed in 1983. That legislation gave drugmakers a package of incentives, including tax credits, user-fee waivers and 7 years of market exclusivity if they developed medicines for rare diseases.

A Kaiser Health News investigation published in January 2017 found many drugs that now have orphan status aren’t entirely new. Of about 450 drugs that have won orphan approval since 1983, more than 70 were drugs first approved by the FDA for mass-market use. Those include rosuvastatin (Crestor), aripiprazole (Abilify), and adalimumab (Humira), the world’s best-selling drug.

Dr. Gottlieb announced plans to close a loophole that allows manufacturers to skip pediatric testing requirements when developing a common-disease drug for orphan use in children. He also signaled that bigger changes are being considered, announcing a public meeting to explore issues raised by scientific advances, such as the increase in precision medicine and biologics.

“We need to make sure our policies take notice of all of these new challenges and opportunities,” he wrote. Dr. Gottlieb, through his agency, declined multiple requests for interviews.

Over the years, drugmakers have fueled a boom in orphan drugs, which often carry six-figure price tags. Nearly half of the new drugs approved by the FDA are now for rare diseases – even though many of them also treat and are marketed for common diseases.

Dr. Gottlieb became commissioner in May, a few months after three key Republican senators called for a federal investigation into potential abuses of the Orphan Drug Act, and the Government Accountability Office agreed to investigate.

The GAO has yet to begin its investigation, saying it doesn’t expect to start work until late this year, when staff is available. Regardless, in late June, Dr. Gottlieb announced what would be the first in a series of updates that shift the way the FDA handles orphan drugs.

Those include:

• Eliminating a backlog in drug applications for orphan designation or status. Getting a designation is a critical first step if a company wants to win orphan incentives once the drug is approved for treatment use. And, much like the rise in approvals, the requests by companies to get drugs designated with orphan status has also skyrocketed. Dr. Gottlieb said in June that he wanted to get rid of the backlog; his blog post noted the effort was complete. About half of the 200 applications from drugmakers won orphan status.
• Mandating that drugmakers prove their medicine is clinically superior before getting the market exclusivity that comes with orphan drug status. The agency had lost a lawsuit in which a company said it was owed the exclusivity period regardless of whether its medicine was better. And two more lawsuits had been filed by Eagle Pharmaceuticals and United Therapeutics. The FDA Reauthorization Act, which passed in August, made it law that a drug has to be clinically superior to get the incentives.
• Closing the loophole for pediatric orphan drugs by requiring all drugs approved for common adult diseases, like inflammatory bowel disease, undergo pediatric testing when getting approval as a pediatric orphan drug. Pediatric testing is not required for orphan drugs, and last month Congress mandated that orphan drugs for cancer be tested for children. Still, the American Academy of Pediatrics celebrated the proposed change but warned it was only a first step. Bridgette Jones, MD, chair of American Academy of Pediatrics Committee on Drugs, said Sept. 12 that orphan drugs are “still mostly exempt from pediatric study requirements … children deserve access to safe, effective medications.”

Martin Makary, MD, who wrote a critical 2015 paper on orphan approvals, said the changes at the agency indicate that Dr. Gottlieb seems “concerned about all the right things. The government does a lot of lip service in general. This is not lip service.”

The restructuring has been swift in some ways.

Sandra Heibel, PhD, a senior consultant at Haffner Associates, a firm that helps companies submit orphan drug applications, noted that the approval process for designations definitely sped up over the summer, and “we are absolutely getting responses from the FDA back in 90 days. That has come through.”

Other changes to the agency, though, will evolve slowly. For example, the orphan drug office has begun reaching across the FDA’s divisions for help in reviewing drugs. In May, the FDA’s orphan reviews began to work with the office of pediatric therapeutics to review pediatric applications – ideally increasing the expertise applied when considering a company’s request for orphan drug use in children.

In an interview, FDA confirmed that Dr. Gottlieb’s orphan modernization plan is part of a larger effort to increase competition and decrease drug prices. One focus is on targeted drugs – especially those that affect rare diseases or diseases for which there is no effective therapy, the agency said.

“Such drugs present some of the biggest opportunities in medicine to treat and cure debilitating and very costly diseases,” the agency stated.
 

Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.

The Food and Drug Administration is changing the way it approves orphan drugs after revelations that drugmakers may be abusing a law intended to help patients with rare diseases.

In a blog post Sept. 12, FDA Commissioner Scott Gottlieb, MD, said he wants to ensure financial incentives are granted “in a way that’s consistent with the manner Congress intended” when the Orphan Drug Act was passed in 1983. That legislation gave drugmakers a package of incentives, including tax credits, user-fee waivers and 7 years of market exclusivity if they developed medicines for rare diseases.

A Kaiser Health News investigation published in January 2017 found many drugs that now have orphan status aren’t entirely new. Of about 450 drugs that have won orphan approval since 1983, more than 70 were drugs first approved by the FDA for mass-market use. Those include rosuvastatin (Crestor), aripiprazole (Abilify), and adalimumab (Humira), the world’s best-selling drug.

Dr. Gottlieb announced plans to close a loophole that allows manufacturers to skip pediatric testing requirements when developing a common-disease drug for orphan use in children. He also signaled that bigger changes are being considered, announcing a public meeting to explore issues raised by scientific advances, such as the increase in precision medicine and biologics.

“We need to make sure our policies take notice of all of these new challenges and opportunities,” he wrote. Dr. Gottlieb, through his agency, declined multiple requests for interviews.

Over the years, drugmakers have fueled a boom in orphan drugs, which often carry six-figure price tags. Nearly half of the new drugs approved by the FDA are now for rare diseases – even though many of them also treat and are marketed for common diseases.

Dr. Gottlieb became commissioner in May, a few months after three key Republican senators called for a federal investigation into potential abuses of the Orphan Drug Act, and the Government Accountability Office agreed to investigate.

The GAO has yet to begin its investigation, saying it doesn’t expect to start work until late this year, when staff is available. Regardless, in late June, Dr. Gottlieb announced what would be the first in a series of updates that shift the way the FDA handles orphan drugs.

Those include:

• Eliminating a backlog in drug applications for orphan designation or status. Getting a designation is a critical first step if a company wants to win orphan incentives once the drug is approved for treatment use. And, much like the rise in approvals, the requests by companies to get drugs designated with orphan status has also skyrocketed. Dr. Gottlieb said in June that he wanted to get rid of the backlog; his blog post noted the effort was complete. About half of the 200 applications from drugmakers won orphan status.
• Mandating that drugmakers prove their medicine is clinically superior before getting the market exclusivity that comes with orphan drug status. The agency had lost a lawsuit in which a company said it was owed the exclusivity period regardless of whether its medicine was better. And two more lawsuits had been filed by Eagle Pharmaceuticals and United Therapeutics. The FDA Reauthorization Act, which passed in August, made it law that a drug has to be clinically superior to get the incentives.
• Closing the loophole for pediatric orphan drugs by requiring all drugs approved for common adult diseases, like inflammatory bowel disease, undergo pediatric testing when getting approval as a pediatric orphan drug. Pediatric testing is not required for orphan drugs, and last month Congress mandated that orphan drugs for cancer be tested for children. Still, the American Academy of Pediatrics celebrated the proposed change but warned it was only a first step. Bridgette Jones, MD, chair of American Academy of Pediatrics Committee on Drugs, said Sept. 12 that orphan drugs are “still mostly exempt from pediatric study requirements … children deserve access to safe, effective medications.”

Martin Makary, MD, who wrote a critical 2015 paper on orphan approvals, said the changes at the agency indicate that Dr. Gottlieb seems “concerned about all the right things. The government does a lot of lip service in general. This is not lip service.”

The restructuring has been swift in some ways.

Sandra Heibel, PhD, a senior consultant at Haffner Associates, a firm that helps companies submit orphan drug applications, noted that the approval process for designations definitely sped up over the summer, and “we are absolutely getting responses from the FDA back in 90 days. That has come through.”

Other changes to the agency, though, will evolve slowly. For example, the orphan drug office has begun reaching across the FDA’s divisions for help in reviewing drugs. In May, the FDA’s orphan reviews began to work with the office of pediatric therapeutics to review pediatric applications – ideally increasing the expertise applied when considering a company’s request for orphan drug use in children.

In an interview, FDA confirmed that Dr. Gottlieb’s orphan modernization plan is part of a larger effort to increase competition and decrease drug prices. One focus is on targeted drugs – especially those that affect rare diseases or diseases for which there is no effective therapy, the agency said.

“Such drugs present some of the biggest opportunities in medicine to treat and cure debilitating and very costly diseases,” the agency stated.
 

Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.

The Food and Drug Administration is changing the way it approves orphan drugs after revelations that drugmakers may be abusing a law intended to help patients with rare diseases.

In a blog post Sept. 12, FDA Commissioner Scott Gottlieb, MD, said he wants to ensure financial incentives are granted “in a way that’s consistent with the manner Congress intended” when the Orphan Drug Act was passed in 1983. That legislation gave drugmakers a package of incentives, including tax credits, user-fee waivers and 7 years of market exclusivity if they developed medicines for rare diseases.

A Kaiser Health News investigation published in January 2017 found many drugs that now have orphan status aren’t entirely new. Of about 450 drugs that have won orphan approval since 1983, more than 70 were drugs first approved by the FDA for mass-market use. Those include rosuvastatin (Crestor), aripiprazole (Abilify), and adalimumab (Humira), the world’s best-selling drug.

Dr. Gottlieb announced plans to close a loophole that allows manufacturers to skip pediatric testing requirements when developing a common-disease drug for orphan use in children. He also signaled that bigger changes are being considered, announcing a public meeting to explore issues raised by scientific advances, such as the increase in precision medicine and biologics.

“We need to make sure our policies take notice of all of these new challenges and opportunities,” he wrote. Dr. Gottlieb, through his agency, declined multiple requests for interviews.

Over the years, drugmakers have fueled a boom in orphan drugs, which often carry six-figure price tags. Nearly half of the new drugs approved by the FDA are now for rare diseases – even though many of them also treat and are marketed for common diseases.

Dr. Gottlieb became commissioner in May, a few months after three key Republican senators called for a federal investigation into potential abuses of the Orphan Drug Act, and the Government Accountability Office agreed to investigate.

The GAO has yet to begin its investigation, saying it doesn’t expect to start work until late this year, when staff is available. Regardless, in late June, Dr. Gottlieb announced what would be the first in a series of updates that shift the way the FDA handles orphan drugs.

Those include:

• Eliminating a backlog in drug applications for orphan designation or status. Getting a designation is a critical first step if a company wants to win orphan incentives once the drug is approved for treatment use. And, much like the rise in approvals, the requests by companies to get drugs designated with orphan status has also skyrocketed. Dr. Gottlieb said in June that he wanted to get rid of the backlog; his blog post noted the effort was complete. About half of the 200 applications from drugmakers won orphan status.
• Mandating that drugmakers prove their medicine is clinically superior before getting the market exclusivity that comes with orphan drug status. The agency had lost a lawsuit in which a company said it was owed the exclusivity period regardless of whether its medicine was better. And two more lawsuits had been filed by Eagle Pharmaceuticals and United Therapeutics. The FDA Reauthorization Act, which passed in August, made it law that a drug has to be clinically superior to get the incentives.
• Closing the loophole for pediatric orphan drugs by requiring all drugs approved for common adult diseases, like inflammatory bowel disease, undergo pediatric testing when getting approval as a pediatric orphan drug. Pediatric testing is not required for orphan drugs, and last month Congress mandated that orphan drugs for cancer be tested for children. Still, the American Academy of Pediatrics celebrated the proposed change but warned it was only a first step. Bridgette Jones, MD, chair of American Academy of Pediatrics Committee on Drugs, said Sept. 12 that orphan drugs are “still mostly exempt from pediatric study requirements … children deserve access to safe, effective medications.”

Martin Makary, MD, who wrote a critical 2015 paper on orphan approvals, said the changes at the agency indicate that Dr. Gottlieb seems “concerned about all the right things. The government does a lot of lip service in general. This is not lip service.”

The restructuring has been swift in some ways.

Sandra Heibel, PhD, a senior consultant at Haffner Associates, a firm that helps companies submit orphan drug applications, noted that the approval process for designations definitely sped up over the summer, and “we are absolutely getting responses from the FDA back in 90 days. That has come through.”

Other changes to the agency, though, will evolve slowly. For example, the orphan drug office has begun reaching across the FDA’s divisions for help in reviewing drugs. In May, the FDA’s orphan reviews began to work with the office of pediatric therapeutics to review pediatric applications – ideally increasing the expertise applied when considering a company’s request for orphan drug use in children.

In an interview, FDA confirmed that Dr. Gottlieb’s orphan modernization plan is part of a larger effort to increase competition and decrease drug prices. One focus is on targeted drugs – especially those that affect rare diseases or diseases for which there is no effective therapy, the agency said.

“Such drugs present some of the biggest opportunities in medicine to treat and cure debilitating and very costly diseases,” the agency stated.
 

Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.

Acting on a request from three influential U.S. senators, the government’s accountability arm confirmed that it will investigate potential abuses of the Orphan Drug Act.

The Government Accountability Office still must determine the full scope of what it will look into and the methodology to be used. Determining the scope will take some months, said Chuck Young, GAO’s managing director for public affairs.

Earlier this month, senators Orrin Hatch (R-Utah), Chuck Grassley (R-Iowa), and Tom Cotton (R-Ark.) sent a letter to the GAO and raised the possibility that regulatory or legislative changes might be needed “to preserve the intent of this vital law” that gives drug makers lucrative incentives to develop drugs for rare diseases.

Sen. Grassley’s office said Tuesday they expected the GAO to begin its work in about 9 months. The delay is typical as the agency has a queue of requests it is pursuing.

The senators have asked the GAO to “investigate whether the ODA [Orphan Drug Act] is still incentivizing product development for diseases with fewer than 200,000 affected individuals, as intended.”

Congress overwhelmingly passed the 1983 Orphan Drug Act to motivate pharmaceutical companies to develop drugs for people whose rare diseases had been ignored. Drugs approved as orphans are granted tax incentives and seven years of exclusive rights to market drugs that are needed by fewer than 200,000 patients in the United States.

In recent months, reports of five- and six-figure annual price tags for orphan drugs have amplified long-simmering concerns about abuse of the law. The senators’ call for a GAO investigation reflects that sentiment.

“While few will argue against the importance of the development of these drugs, several recent press reports suggest that some pharmaceutical manufacturers might be taking advantage of the multiple designation allowance in the orphan drug approval process,” the letter states.

In January, Kaiser Health News published an investigation that found the orphan drug program is being manipulated by drug makers to maximize profits and to protect niche markets for medicines being taken by millions.

That investigation, which also was published and aired by NPR, National Public Radio, found that many drugs that now have orphan status aren’t entirely new. More than 70 were drugs first approved by the Food and Drug Administration for mass-market use. Those include cholesterol blockbuster, Crestor; Abilify for psychiatric disorders; and the rheumatoid arthritis drug, Humira, the world’s best-selling drug.

Others are drugs that have received multiple exclusivity periods for two or more rare conditions.

The senators asked the GAO for a list of drugs approved or denied orphan status by the FDA. It also asked whether FDA resources, which oversees the law, have “kept up with the number of requests” from drug makers and if there is consistency in the department’s reviews.

They stated that it would be important to include patient experiences in the GAO review. The GAO does not provide updates on ongoing work but rather reports its findings once the assignment has been completed.

The rare-disease drugs have become increasingly popular with pharmaceutical and biotech companies and are expected to comprise 21.% of worldwide prescription sales by 2022, not including generics, according to consulting firm EvaluatePharma’s 2017 orphan drug report.

That’s in part because of the exorbitant prices that can be charged. Of the top 100 drugs in the United States, the average cost per patient per year for an orphan drug was $140,443 in 2016, compared with $27,756 for a nonorphan, EvaluatePharma said.
 

Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation. KHN’s coverage of prescription drug development, costs, and pricing is supported in part by the Laura and John Arnold Foundation.

Acting on a request from three influential U.S. senators, the government’s accountability arm confirmed that it will investigate potential abuses of the Orphan Drug Act.

The Government Accountability Office still must determine the full scope of what it will look into and the methodology to be used. Determining the scope will take some months, said Chuck Young, GAO’s managing director for public affairs.

Earlier this month, senators Orrin Hatch (R-Utah), Chuck Grassley (R-Iowa), and Tom Cotton (R-Ark.) sent a letter to the GAO and raised the possibility that regulatory or legislative changes might be needed “to preserve the intent of this vital law” that gives drug makers lucrative incentives to develop drugs for rare diseases.

Sen. Grassley’s office said Tuesday they expected the GAO to begin its work in about 9 months. The delay is typical as the agency has a queue of requests it is pursuing.

The senators have asked the GAO to “investigate whether the ODA [Orphan Drug Act] is still incentivizing product development for diseases with fewer than 200,000 affected individuals, as intended.”

Congress overwhelmingly passed the 1983 Orphan Drug Act to motivate pharmaceutical companies to develop drugs for people whose rare diseases had been ignored. Drugs approved as orphans are granted tax incentives and seven years of exclusive rights to market drugs that are needed by fewer than 200,000 patients in the United States.

In recent months, reports of five- and six-figure annual price tags for orphan drugs have amplified long-simmering concerns about abuse of the law. The senators’ call for a GAO investigation reflects that sentiment.

“While few will argue against the importance of the development of these drugs, several recent press reports suggest that some pharmaceutical manufacturers might be taking advantage of the multiple designation allowance in the orphan drug approval process,” the letter states.

In January, Kaiser Health News published an investigation that found the orphan drug program is being manipulated by drug makers to maximize profits and to protect niche markets for medicines being taken by millions.

That investigation, which also was published and aired by NPR, National Public Radio, found that many drugs that now have orphan status aren’t entirely new. More than 70 were drugs first approved by the Food and Drug Administration for mass-market use. Those include cholesterol blockbuster, Crestor; Abilify for psychiatric disorders; and the rheumatoid arthritis drug, Humira, the world’s best-selling drug.

Others are drugs that have received multiple exclusivity periods for two or more rare conditions.

The senators asked the GAO for a list of drugs approved or denied orphan status by the FDA. It also asked whether FDA resources, which oversees the law, have “kept up with the number of requests” from drug makers and if there is consistency in the department’s reviews.

They stated that it would be important to include patient experiences in the GAO review. The GAO does not provide updates on ongoing work but rather reports its findings once the assignment has been completed.

The rare-disease drugs have become increasingly popular with pharmaceutical and biotech companies and are expected to comprise 21.% of worldwide prescription sales by 2022, not including generics, according to consulting firm EvaluatePharma’s 2017 orphan drug report.

That’s in part because of the exorbitant prices that can be charged. Of the top 100 drugs in the United States, the average cost per patient per year for an orphan drug was $140,443 in 2016, compared with $27,756 for a nonorphan, EvaluatePharma said.
 

Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation. KHN’s coverage of prescription drug development, costs, and pricing is supported in part by the Laura and John Arnold Foundation.

Acting on a request from three influential U.S. senators, the government’s accountability arm confirmed that it will investigate potential abuses of the Orphan Drug Act.

The Government Accountability Office still must determine the full scope of what it will look into and the methodology to be used. Determining the scope will take some months, said Chuck Young, GAO’s managing director for public affairs.

Earlier this month, senators Orrin Hatch (R-Utah), Chuck Grassley (R-Iowa), and Tom Cotton (R-Ark.) sent a letter to the GAO and raised the possibility that regulatory or legislative changes might be needed “to preserve the intent of this vital law” that gives drug makers lucrative incentives to develop drugs for rare diseases.

Sen. Grassley’s office said Tuesday they expected the GAO to begin its work in about 9 months. The delay is typical as the agency has a queue of requests it is pursuing.

The senators have asked the GAO to “investigate whether the ODA [Orphan Drug Act] is still incentivizing product development for diseases with fewer than 200,000 affected individuals, as intended.”

Congress overwhelmingly passed the 1983 Orphan Drug Act to motivate pharmaceutical companies to develop drugs for people whose rare diseases had been ignored. Drugs approved as orphans are granted tax incentives and seven years of exclusive rights to market drugs that are needed by fewer than 200,000 patients in the United States.

In recent months, reports of five- and six-figure annual price tags for orphan drugs have amplified long-simmering concerns about abuse of the law. The senators’ call for a GAO investigation reflects that sentiment.

“While few will argue against the importance of the development of these drugs, several recent press reports suggest that some pharmaceutical manufacturers might be taking advantage of the multiple designation allowance in the orphan drug approval process,” the letter states.

In January, Kaiser Health News published an investigation that found the orphan drug program is being manipulated by drug makers to maximize profits and to protect niche markets for medicines being taken by millions.

That investigation, which also was published and aired by NPR, National Public Radio, found that many drugs that now have orphan status aren’t entirely new. More than 70 were drugs first approved by the Food and Drug Administration for mass-market use. Those include cholesterol blockbuster, Crestor; Abilify for psychiatric disorders; and the rheumatoid arthritis drug, Humira, the world’s best-selling drug.

Others are drugs that have received multiple exclusivity periods for two or more rare conditions.

The senators asked the GAO for a list of drugs approved or denied orphan status by the FDA. It also asked whether FDA resources, which oversees the law, have “kept up with the number of requests” from drug makers and if there is consistency in the department’s reviews.

They stated that it would be important to include patient experiences in the GAO review. The GAO does not provide updates on ongoing work but rather reports its findings once the assignment has been completed.

The rare-disease drugs have become increasingly popular with pharmaceutical and biotech companies and are expected to comprise 21.% of worldwide prescription sales by 2022, not including generics, according to consulting firm EvaluatePharma’s 2017 orphan drug report.

That’s in part because of the exorbitant prices that can be charged. Of the top 100 drugs in the United States, the average cost per patient per year for an orphan drug was $140,443 in 2016, compared with $27,756 for a nonorphan, EvaluatePharma said.
 

Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation. KHN’s coverage of prescription drug development, costs, and pricing is supported in part by the Laura and John Arnold Foundation.