Insurance Companies Accuse #Pharma of Gaming the Orphan Drug Approval System | Pharmaguy's Insights Into Drug Industry News |

Pharma companies may be exploiting a legal loophole that increases utilization costs of certain drugs, according to a study from AHIP (America's Health Insurance Plans).


"Orphan drugs" treat rare diseases impacting populations fewer than 200,000 annually that are otherwise lacking special treatment. Pharmaceutical companies can make tremendous profits by finding uses for those drugs outside of the original condition the medications were intended to treat. While the practice is legal, some experts say pharmaceutical companies are “gaming the system,” according to the brief.


Almost half of the orphan drug use in the study was for non-orphan diseases and conditions.


AHIP notes,"in a 2012 study on more than 350 orphan drugs approved through mid-2010, researchers found that 43 drugs, having at least one approved orphan indication, achieved global sales in excess of $1 billion in 2008."


Market exclusivity and extremely high prices have created such “blockbuster” orphan drugs, “a result that seemingly runs counter to the spirit” of the law which incentivizes rare disease research, the report adds.


[FDA approved 45 new drugs in 2015, four more than in 2014 and the highest number since 1996. Twenty (20) of those (43%) were "orphan" drugs. More on this here:]