Pharmaguy's Insights Into Drug Industry News
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Pharmaguy's Insights Into Drug Industry News
Pharmaguy curates and provides insights into selected drug industry news and issues.
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Because of Potential Abuse, Orphan Drug Act Might Need to Be “Repealed & Replaced”

Because of Potential Abuse, Orphan Drug Act Might Need to Be “Repealed & Replaced” | Pharmaguy's Insights Into Drug Industry News |

Building on weeks of mounting pressure to address high prescription drug prices, three influential U.S. senators have asked the government's accountability arm to investigate potential abuses of the Orphan Drug Act.


In a letter to the U.S. Government Accountability Office, Sens. Orrin Hatch, R-Utah, Chuck Grassley, R-Iowa, and Tom Cotton, R-Ark., 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.


"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 published Friday states.


In January, NPR published a Kaiser Health News 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 (read “Orphan Drug Sales Offer a Glimpse of ‘Sheer Greed’”;


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 U.S.


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


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


The Kaiser Health News investigation found that many drugs that now have orphan status aren't entirely new. More than 70 were drugs first approved by the FDA for mass-market use. Those include cholesterol blockbuster Crestor (read “#Pharma Welfare: ‘Orphan’ Blockbuster Drugs on Rise - Including Crestor!;, Abilify for psychiatric disorders and 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. About 80 drugs fall into this category, including cancer drug Gleevec and wrinkle-fighting drug Botox.


Further Reading:


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#Pharma Welfare: "Orphan" Blockbuster Drugs on Rise - Including Crestor!

#Pharma Welfare: "Orphan" Blockbuster Drugs on Rise - Including Crestor! | Pharmaguy's Insights Into Drug Industry News |
An FDA rule created to spur drug companies to develop treatments for rare diseases is being used far beyond its original scope, critics say.


[Would you believe that Crestor is an "orphan" drug? Also read: "How AstraZeneca Hopes To Use 'Orphan Drug' Designation To Extend Patent Life Crestor";]


A new study from Johns Hopkins University School of Medicine questions whether some of the biggest drug companies and their blockbuster medications are taking advantage of a decades-old act meant to increase research, development and drug approval for people suffering from rare diseases.


The new study, published in the American Journal of Clinical Oncology,argues that while the ODA has fostered drug development for patients with rare cancers and other diseases, current data suggest that companies are "gaming the system to use the law for mainstream drugs." 


The authors found what they deem "a pattern of pharmaceutical companies submitting drugs to the Food and Drug Administration (FDA) as orphan drugs but once approved, the drugs are used broadly off-label with the lucrative orphan drug protections and exclusivity benefits."


The study contends that some big drug companies submit a drug for FDA approval with a narrow enough indication that would qualify it for orphan drug benefits. After FDA approval, however, the drug can be used more broadly.


For example, Rituxan (rituximab), which is made by Roche and was initially FDA approved for use in the treatment of follicular non-Hodgkin's lymphoma, is the No. 1 selling medication approved as an orphan drug. 


"It is currently used to treat a wide variety of conditions, ranks as the 12th all-time bestselling medication in the United States, and generated over $3.7 billion in U.S. sales in 2014," the report states. 


The researchers' concern is not only the "corporate welfare" that is being afforded to blockbuster drugs and highly profitable drug companies, but that "patients with rare cancers and other diseases may suffer due to dilution of the tax incentives and other benefits" offered by the rule to spur the development of niche drugs.

Pharma Guy's insight:

As I said back in 2011 when I channeled Will Sutton's ghost: Orphan Drugs Are Now "Where the Money Is." I said: Until a few years ago, if you asked a pharmaceutical company executive why his or her company developed and marketed an "orphan drug" -- ie, a drug for a disorder affecting fewer than 200,000 people in the U.S. -- you would likely have gotten a response such as "because there is an unmet medical need" or something similar. Today, however, orphan drugs also have the potential to turn into blockbusters. Read more here: 

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