Rare diseases are a global problem. While each identifiable rare disease may affect only a small number of patients, rare diseases en masse affect millions of people around the world. Many research projects in this field are growing, although at the moment for the over 7000 rare diseases, in Europe exist less than 100 drugs. Aggregation and networks are necessary to support the research and to ensure access to appropriate healthcare for all patients with rare diseases
There are around six to eight thousand diseases classified as “rare” or “orphan” in the world and 80% of them are related to genetic alterations. About 50% of the total affects children. However, the definition varies: in Europe, by definition, a rare disease is defined as a life-threatening or chronically debilitating disease affecting not more than five people in every 10,000; while in America and Japan fall into this category, respectively, diseases that affect no more than 200,000, or 50,000 people.
Categorizations aside, according to data, 30 million people in the US and another 30 million people in Europe suffer from rare diseases (approximately 7-9% of the global population), which means that the number of patients with orphan diseases in total exceeds the sum of patients with tumors or heart disease. Although the high number of patients with rare diseases, only 250 have a definition proposed by the WHO (World Health Organization). The Orphan Drug Act wanted by Ronald Reagan in 1983 marked the beginning of a series of political and economic measures designed to meet the therapeutic needs of patients with rare diseases. Since then, in other countries regulations have been introduced to taking action to encourage industry to invest in this complex field rich of business risks. The first companies, however, have been able to show that it was possible to do business with targeted strategies for innovation and focusing much on biotechnology research and, for that, over the years the production of drugs for the treatment of rare diseases has increased so much that it is estimated that in 2020, 19% of the drug market will be for orphan drugs.
FUNDS AND INCENTIVES FOR PHARMACEUTICAL DEVELOPMENT
The funds made available between public, private and non-profit are increasing as well as the number of companies researching in this field. For example, the $187 million allocated by the European Commission (EC) in March 2013 for 26 new projects aimed at developing new therapeutic strategies within 2020 for 200 rare diseases. There are twenty-nine countries involved between Europe and US with over 300 participants. The funds support the work of the International Rare Diseases Research Consortium, created by the EC and the US National Institute of Health in 2011 with the purpose of coordinating researches in this field. The 26 projects range from clinical trials on specific products, to the development of a global infrastructure called RD-Connect that will be used to share the results of research as an archive of genomic data on orphan diseases. Concerning the development of new orphan drugs, there are different strategies including market exclusivity, assistance in developing new protocols, tax reductions and regulatory Fee waivers (Table 1).
Table 1. Orphan drug incentives around the world
|Market exclusivity(years)||Research Grants||Tax Credits||Fast Track approval||Protocol Assistance||Regulatory Fee waivers|
|US||7||Government grants for clinical research||Up to 50% for clinical expenses||Yes||Yes||Yes|
|EU||10||Framework programmes plus national measures||Managed by Member States||Yes (centralised approval)||Yes||Yes|
|JAPAN||10||Government grants for clinical and non-clinical research||15% tax credits; up to 14% corporate tax reduction||Yes||Yes||Yes|
|AUSTRALIA||5 (as for other drugs)||No||No||Yes||Yes||Yes|
|CHINA||n/a||NSFC grants research||n/a||Yes||n/a||n/a|
|TAIWAN||10||Government grants and awards from central competent authority||n/a||Yes||Yes||n/a|
Regulation in the EU
In the EU, orphan designation is based on the criteria laid down in Regulation (EC) N° 141/2000, which was published in the Official Journal of the EC on January 22, 2000. This legislation is based on the premise that patients suffering from rare conditions should be entitled to the same quality of treatment as other patients, and provides incentives for the pharmaceutical industry to develop orphan medicinal products.
Another important regulation is the one on advanced therapy medicines, 1394/1997. Pasquale Frega, President and CEO of Celgene, reminds us that «the orphan drug designation is granted by the Authority only on three conditions: the disease is serious and rare, that there is a not valid therapy and that the treatment will bring a significant clinical benefit». Since the introduction of the EMA (European Medicines Agency) Orphan Drug Regulation has constantly introduced new development policies on the subject; the rare diseases, in fact, have been identified as a priority within the EU Health Program 2008-2013 with recommendations by the Council of Member States to create plans and national centers to stimulate the research on orphan diseases.
A growing market…
During the last five years one-third of new drugs approved in the world were intended to rare diseases. According to the “Orphan Drug Report 2014” published by Evaluate Pharma, drugs are expected to account for 19% of the total share of prescription drug sales, totalling $176bn, excluding generics. The expected growth in this sector is twice higher than that of pharmaceutical compounds directed to other categories of diseases, excluding generics. Orphan drugs, are estimated to lead a return of the initial investment more than non-orphans drugs. Expected return on investment of phase III filed orphan drugs 1.89 times greater than non-orphan drugs. This is mainly due to the studies on rare diseases that require a significantly reduced number of patients included (median of 538 compared to 1491) with estimated costs of clinical trials of about $99 million vs. $188 million for non-orphans. Note, however, that the timing of development for orphan drugs are still not reduced compared to non-orphans in the American system (2.89 years average). In 2014 the average cost per patient treated with orphan products amounted to $ 137 while stops at 20$ for the traditional products. Therefore, it is a business model that works and repays the pioneering biotech or pharmaceutical companies that have focused on the research of rare diseases after the 80s and that has prompted more companies to focus on research in the field of orphan diseases.
… but with higher business risks
A model that has, however, a downside: the business risk. Frega draws attention to the need of “doing more” in this area and the high risk of failure: «one out of ten drugs designated as “orphans” reaches the authorization to access the market. The risk of failure, always present in the research field is particularly high when we are looking for a treatment that brings a real clinical benefit in diseases that have no available treatments. In Italy Celgene has activated more than one hundred clinical trials that involved more than thousand patients and over a hundred of Italian centers of Hematology and /or Oncology».
«The growth of research projects – explains Luisa Muscolo, Aifa (Italian Medicines Agency) – is partly justified by the recommendations made on 8 June 2009 by the European Community, in identifying a priority in rare diseases research and is partly due to the considerable impact that these studies promise to have even on common diseases, which often have the reference models for understanding them as well as the rare diseases».
«After a pioneering era founded with the birth of the Orphan Drug Act – says Riccardo Palmisano, Vice President Assobiotec and President of Genzyme – there was a second phase in which some companies have shown the ability to realize value also working with extremely low numbers of rare and ultra-rare diseases, reaping the benefits of their research».
«In the last several years – continues Palmisano – we entered into a sort of third phase, in which at the same time we have demonstrate that the model of orphan drugs also works from the economic point of view; in fact, we have witnessed the phenomenon of patent expiration of major blockbusters that have characterized the pharmaceutical industry of the 90s and the first decade of the new millennium».
The combination of a sector of the diseases that are most used now largely treatable with generic products and thus low prices and a huge area of unmet clinical needs in the area of rare diseases, did move interest and investment into this sector, with an increasing number of orphan drug designation. There remain, however, some elements to consider: «first of all – adds Palmisano – there is a highly innovative research but a high risk of failure, secondly even if the numbers of patients are much lower, the cost of development is not proportionately reduced compared to the treatments which faces the traditional pathologies. Inside of the final costs of development for an orphan drug are in fact included all costs incurred to find the right path, which often include a large number of collaborations with external research company, whether public, private or non-profit organizations. In this area, in fact, there is a very developed network aimed at establish partnerships with organizations that lead the most promising research. But only a few of these, however, become effective therapies capable of transforming the lives of rare patients and provide an adequate return on investment. Finally, biotech companies working in the field of orphan drugs and personalized therapy reinvest annually in research very high percentage of revenues, exploring new ways to treat orphan diseases».
In these 31 years after the Orphan Drug Act wanted by Ronald Regan in 1983 to facilitate research in the field of rare diseases we assisted an initial pioneering phase, then a phase of commercial success and now we are about to enter a fourth phase, in which payers and R&D will have to meet to ensure the sustainability of the sector in the coming years. According to pharmacoeconomic data, the commitments at economic and resources level have increased significantly in recent years and in the near future, will increase benefits for patients and orphan drugs. This equation, however, will soon have to take into account also that the increase of orphan drugs available on the market requires an increase in health expenditure of the various states. For the future, it is necessary to find a balance among the interest to invest in this field and the sustainability of the expense.
In general, the care systems are increasingly inclined to deny or severely limit the reimbursement cost of treatment when the clinical value of the medicine is not showing favorable, especially if the criteria for the identification of the target population are not sufficiently defined. In this context have been developed a Managed Entry Agreement Scheme, aimed at limiting the reimbursement of medicines at those subpopulations most likely to benefit from treatment. For example, «one of the most advanced tools developed by the Italian Pharmaceutical Agency (Aifa) – as explains Muscolo – Is the system of monitoring logs. They are designed to determine the eligibility of a patient to the treatment, ensuring the appropriate use of the drug in relation to the indication approved and decisions on its reimbursement. In this way it is possible to acquire specific information regarding the use of a drug in clinical practice, collect epidemiological data on patients exposed to treatment, monitor the safety profile of the product and, ultimately fill those uncertainties related to a drug of first authorization».
The Aifa registers are often linked to other forms of conditional reimbursement related to the clinical outcome and therapeutic success. Aifa has adopted different models of risk sharing and the related costs for pharmaceutical companies. In Italy, they tend to prefer the payment-by-result compared to the cost-sharing and risk-sharing.
Biotechnology for rare diseases
The attention to the rare diseases is undoubtedly growing at all levels; it was and it is a gradual process, but today the awareness of all the players involved in the system is much higher, especially thanks to the endless work of rare patients associations, that fight to make visible what that until a few years ago was for a few insiders. There is still a long way to go, starting with the early diagnosis until the recognition of the social impact of a rare genetic disease in the family, but certainly today the major issue is very clear for all the players in the health world.
The biotech sector is very dynamic and has a very high level of quality. The level of excellence achieved by Red Biotech is confirmed by the commitment in the field of rare diseases and advanced therapies. For example in Italy, the report BioInItaly 2014 Assobiotec identified 21 Italian companies active in the field of orphan diseases, with 47 projects under development of which 10 have obtained the Orphan Drug Designation by the EMA (European Medicine Agency), 7 the by FDA Office of Orphan Products Development (OOPD) and 30 by both. If, however, we consider all orphan drugs authorized by AIFA, then the list is even longer (78 drugs approved), since they add orphan-like drugs, and the orphan products, which, having benefited from market exclusivity for 10 years, have been removed from the Community register. The figures indicate that are biotech about 20% of the drugs on the market, 40% of the new drugs and over 60% of those in the developing stage. According to the FirstWord dossier, in Europe, there are more than 40 companies that have obtained the Marketing Authorization for orphan drugs, 30 of which each hold a single MA. Oncology is the main therapeutic area both in Europe and in the US (Box “Therapeutic areas and orphan drugs in EU and US”). Looking at the drugs not yet approved, but in a developing stage of research, the focus is on 1200 designated molecules, but the number of detectable biotechnology is much higher. The research field intended for the cure of rare diseases is mainly, though not exclusively, biotechnology.
THERAPEUTIC AREAS AND ORPHAN DRUGS IN EU AND US
As of October 2014, 80 orphan drugs are authorized in the market in EU (October 2014). The FirstWord dossier presents a classification by therapeutic areas (referred to, however, in October 2013, with 66 orphan drugs approved) (Table 2). In the US, October 2013, were presented on the market 448 orphan drugs, of which 23.1% for oncology indications, 9.1% for immunology and 8.2% for systemic hormones.
Table 2. Orphan drugs authorized in the EU by therapy areas
Network, partnerships and collaborations are fundamental at all stages: from the basic research aimed at sharing the expertise in the pre-competitive phase avoiding duplications in partnership among public sector, private sector and no-profit to reach the collaboration between institutions and companies in all the phases: authorization, access to the market and reimbursement. Remembering at all stages the focus on orphan patients and their involvement.
FirstWord Dossier. Market Access for Orphan Drugs: assessing the global landscape. December 2013
EvaluatePharma. Orphan Drug Report 2014. October 2014