Orphan Drug Act Research Articles

Developing treatments for inborn errors: incentives available to the clinician

Disorders resulting from inborn errors of metabolism (IEM) affect very small numbers of individuals. The entire population, however, of patients suffering the results of inherited metabolic disorders is large, and has been of increasing concern to patient groups and health care professionals in the United States as well as other countries throughout the world. The 1983 US Orphan Drug Act (ODA) serves to facilitate the development of drugs to treat rare diseases by providing several economic incentives. The sponsor of a product designated as an orphan by the Food & Drugs Administration (FDA) Office of Orphan Products Development (OPD) qualifies for tax credits on clinical trial expenses, the award of grant funding by FDA, through the OPD, and 7 years of marketing exclusivity for a designated drug, or biological product that receives FDA market approval. Orphan drug legislation in the US has benefited victims of IEM by encouraging development of drugs for metabolic deficiencies affecting populations that otherwise would be ignored. America’s solution to the orphan drug problem has had worldwide impact. The success of this legislation was a factor leading to the 1993 orphan drug law in Japan; the 1997 implementation of a process whereby most FDA-approved orphan drugs and biological products will be similarly approved in Australia; and, in 1999, regulation on orphan medicinal products in the European Union (EU). Today, international support for rare disease research is providing stimulus and motivation to overcome the financial barriers and encourage development of treatment for very rare diseases throughout the world.

Two decades of orphan product development.

Over the past 20 years, incentives of the Orphan Drug Act (ODA), the largest single source of extramural clinical grants at the US Food and Drug Administration, have had a substantial impact on public health. ODA incentives have contributed to the development of many innovative biotechnology products, and as our understanding of the human genome evolves, it is anticipated that pharmacogenomics will result in the identification of more 'orphan diseases'.

Orphan Drug Act

Orphan drug companies sit at the intersection of the public and private sectors, as various regulatory agencies and nonprofit organizations join to encourage the development of new treatments for rare diseases—about 6,000 mostly genetic ailments that, in sum, affect roughly one in ten Americans, or close to 25 million people. Congressional approval of the Orphan Drug Act (ODA) in 1983, and subsequent cooperation between a number of public and private institutions, have created more attractive protections and incentives for venture capital and private equity firms to invest in drug development targeted at “orphan diseases.”

The economics of orphan drug policy in the US. Can the legislation be improved?

This review of the US Orphan Drug Act (ODA) 1983 outlines how the ODA is intended to stimulate orphan drug research and development of drugs for rare diseases. We also evaluate the effectiveness of the ODA in the past decade and provide recommendations for ODA improvements in the future. The economic incentives embedded in the ODA are presented in a simple economic model, in which a guarantee of market exclusivity plays a central role in encouraging firms to pursue the development of orphan products. Some evidence suggests that this provision has been a major impetus for the rise in orphan drug applications and designations in the last decade. Market exclusivity is the key incentive for orphan drug research, and should be retained. Concerns about a limited number of highly successful 'blockbuster' orphan drugs should be evaluated in terms of the useful economic incentives. In the future, exceptionally high profits could be limited by more precise evaluation of disease prevalence, elasticity of demand, and the other uses of orphan compounds. We further recommend an expansion of the ODA tax credits and research grants programme and targeting of 'priority' diseases. We conclude that the ODA has been a valuable legislative initiative, but it can be strengthened with some simple extensions of the current incentives that it contains.

The Role of Fda's Orphan Products Development Program in the Facilitation of Development of orphan drugs and other Products; Implementation of the Orphan Drug act

The Role of Fda's Orphan Products Development Program in the Facilitation of Development of orphan drugs and other Products; Implementation of the Orphan Drug act