A comparative study of orphan drugs in US, EU & India

Today, more than 5,000 diseases are catalogued as “rare” by the scientific community, so long as they affect small sections of population. The drugs used for the treatment of rare diseases are known as orphan drugs. An orphan drug is a pharmaceutical agent that has been developed specifically to treat a rare medical condition, the condition itself being referred to as an orphan disease. Initially a guideline (Orphan Drug Act) for orphan drugs has been made in the USA In the United States (US) rare diseases are defined as a disease or a condition which affects fewer than 200,000 patients in the country (6.4 in 10,000 people), while the European Union (EU) identifies a rare disease as a life-threatening or chronically debilitating condition affecting no more than five in 10,000 people.

Exemption from application filing fees, tax credits for clinical research, marketing exclusivity for definite period of time and grant for phase I/II clinical trials are among the benefits given to the manufacturer of orphan drugs. As a result of these benefits number of drugs for the treatment of rare disease has been increased significantly in the last few years. The orphan drug program can help the pharmaceutical companies in earning profit and recovering their investment even with small patient population in the developed countries.

The definition of orphan and rare disease is different in different countries on the bases of the number of patients affected by them. Diseases that manifest in patient populations representing at the maximum 6-8 per cent of the world population are defined as “rare diseases” or “orphan diseases. The definition of rare diseases varies but typically considers disease prevalence, severity and existence of alternative therapeutic options. In the United States rare diseases are defined as a disease or a condition fewer than 200,000 patients in the country while the European Union identifies a rare disease as a life-threatening or chronically debilitating condition affecting no more than five in 10,000 people. A recent systematic review of cost-of-illness studies on 10 rare diseases (including cystic fibrosis and haemophilia) found overall limited information published. Nevertheless it is generally accepted that a disease having fewer than 100 patients per 1,00,000 population is described as rare disease and fewer than two patients per 1,00,000 is described as ultra-rare disease. Most rare diseases are genetic; because symptoms do not appear earlier, they exist throughout the persons entire life .Some of the rare diseases can be occurring due to allergies or infections or due to proliferative and degenerative causes. As a rare disease patient population is very small, rare diseases are generally neglected by the doctors and pharmaceutical companies. There are approximately 7000 types of rare diseases that have being discovered India currently has no regulations for orphan drug manufacturing or selling.

It is estimated that 72,611,605 people are affected by rare diseases in India.

Few rare diseases are

• Aarskogs syndrome
• Bacterial meningitis
• Calciphylaxis
• Darier disease
• Ebola virus disease
• Geniospasm
• Hashimoto’s encephalitis
• IgM deficiency
• Jensen syndrome
• Kabuki syndrome
• Laryngeal cancer
• Meigel disease
• Nelson syndrome
• Ochronosis
• Papular urticarial
• Quebec platelet disorder
• Sakoda complex
• Taurodontism

The objective of this review is to look into Indian orphan drug regulations and an emphasis has been laid on ODA (orphan drug act) of US and orphan drug policies of other developed countries such as Europe thus showing the requirement of adopting ODA like legislations in India. The orphan drug regulation varies in different countries. The US was the first country to introduce an orphan drug act in 1983. Exemption from application filing fees, tax credits for clinical research, marketing exclusivity for definite period of time and grant for phase1/2 clinical trials are among the benefits given to the manufacturer of orphan drugs. The incentives given by governments to the developers and manufacturers of orphan drugs have led to growth of research in this field. The orphan drug designation depending upon the ratio of the number of patients affected by rare disease which is 7.5/10,000 individuals in the US. Remarkable growth is seen in orphan drug designations, 12 per cent to 291 in US and 62 per cent to 201 in EU from 2013-2014. Over the period of time, a number of drugs crossed from type I –type III categories. The rare bacterial diseases like wilsons disease can be treated with antimicrobials but nowadays it is treated with penicillamine, zinc and triethylene tetramine. It is most difficult to find sponsors for type I and type-III categories of drugs having pharmaceutical activity but is yet not marketed. If these drugs are found to be effective in treating a common disease can become profitable as type V drugs. Type II drugs are profitable but not fulfil the market requirement properly.

Orphan drug status: Various probabilities
Products intended to treat rare diseases. These products are developed to treat patients suffering from very serious diseases for which no treatment, or at least a satisfactory one, has so far been available. These diseases affect only a small proportion of the population most often at birth or in infancy. The number of rare diseases for which no treatment is currently available is estimated to be between 4,000 and 5,000 worldwide.

Products withdrawn from the market for economic or therapeutic reasons. A few drugs which are withdrawn from the market for some reasons, e.g., thalidomide widely used as a hypnotic drug some years ago for its high teratogenic (triggering fetal malformations) risk may show a very interesting therapeutic application, i.e., analgesic proprieties in rare diseases such as leprosy and lupus erythematosus. These are diseases for which no satisfactory treatment is available.

The global orphan drugs market reached $84.9 billion in 2009 growing from $58.7 billion in 2006 from $54.5 billion in 2005. The market is expected to grow at a compound annual growth rate (CAGR) of nearly six per cent to reach $112.1 billion by 2014. The US accounted for 51 per cent of the market in 2009 and is expected to grow at a CAGR of 8.9 per cent to reach $65.9 billion by 2014.

Regionally, U.S. revenues in the market grew to $32.5 billion accounting for 55 per cent of the market in 2006. The U.S. market is expected to grow at a CAGR of eight per cent to reach $47.8 billion by 2011.

Biological drugs account for a major share (64.3 per cent) of the orphan drug market with sales of $54.6 billion in 2009 as compared to $35.3 billion in 2006 and $30.2 billion in 2005. The size of the biological orphan drug market is projected to grow at a 6.9 per cent CAGR to reach $76.2 billion by 2014.

Orphan drugs for the cancer sector generated the largest amount of revenues, $30.6 billion in 2009, and accounting for 36 per cent of the market. Revenues for cancer-related orphan drugs are expected to grow at a CAGR of 10 per cent to reach $49.7 billion in 2014.

Definition of orphan drugs United States
As defined in the United States, any drug developed under the Orphan Drug Act of January 1983 (ODA) is an orphan drug. The ODA is a federal law concerning rare diseases (orphan diseases) that affect fewer than 200,000 people in the United States or are of low prevalence (less than five per 10,000 in the community).

Europe
A disease or disorder that affects fewer than 5 in 10,000 citizens is the definition for rare in Europe (Orphan Drug Regulation 141/2000). At first glance, this may seem a small number, but by this definition, rare diseases can affect as many as 30 million European Union citizens. According to EURORDIS (European Organization for Rare Diseases), the number of rare diseases numbers from about 6,000 to 8,000, most of which have identified genetic conditions, with medical literature describing approximately five new rare conditions every week. Twenty-five to Thirty million people are reported to be affected by these diseases in Europe.

India
The need for such an act is thus evident from the initiative by the Indian pharmacists and the Government to implement Laws, which would strengthen the health infrastructure and provide relief to the numerous rare disease sufferers throughout the country. A group of pharmacologists at a conference held by the Indian Drugs Manufactures Association in 2001 requested the Indian Government to institute the Orphan Drug Act in India.

Orphan drug regulations EU
Development of an orphan drug policy is part of the 1996 work program
The policy is likely to include:

• designation based on prevalence of disease in the population of less than 0.05% (about 180,000 patients) and no expectation of profitability and subject to review and withdrawal if criteria no longer apply
• shared cost program to support research in addition to the BIOMED program already in place
• monitored release program in addition to the current provision which permits marketing authorization for some drugs based on a limited dossier”

US
Orphan Drug Act (January 4, 1983)

• Designation granted based on prevalence of disease in the population of less than 200,000 people (approximately 0.1%) or no reasonable expectation of profitability
• Protocol assistance to design research protocols
• Tax credits for clinical researchMarket exclusivity
• Funding grants for clinical research to support development
• Penalty for intentionally false statement of orphan status
• Parallel track program and treatment INDs provide access to unapproved drugs
• Process patents granted for biotechnology products
• Accelerated approvals

India
The regulations for orphan drug manufacturing or marketing have not been made till now in India. Approximately 6,000–8,000 rare diseases are found in India, being some of them Wilson Diseases, Leishmaniosis, Norrie Disease, Cystic Fibrosis, Arthrogryposis etc. Most of these diseases are genetic in nature and do not have any treatment. These rare diseases are affecting 72, 611, 605 people in India. The scarcity of regulation of orphan drugs adversely affects the economic growth of Indian medicinal industries.

This large number of patients suffering with rare diseases should not be left to their own miserable conditions without any consideration and cure. The condition of rare disease should be addressed by Indian government immediately. A suitable legislation should be made for regulation of orphan drugs.

Orphan drug designation
The OOPD assess requests for orphan drug designation and when a drug is to be designated it acts along with the FDA review division to facilitate progress. The OOPD is answerable for assessing, awarding, and watching the progress of orphan drug grants. The ODA make available for granting special status, orphan drug designation, of a product to treat a rare disease or condition upon request of a sponsor. The approved orphan designation application does not change the standard regulatory requirements and procedure for obtaining marketing approval. Sponsors must prove the safety and efficacy of a compound to treat a rare disease through satisfactory and well-controlled studies.

Orphan drug status
This may be entitled to a drug if it meets the following criteria: if a drug is not approved earlier or an approved drug with new orphan indication. If a drug proved clinically superiority over previously approved drug of same category. Sometimes, orphan status may be granted to a pharmaceutical product if it demonstrates that the subset is medically acceptable for only a subclass of people with a specific disease even when the drug is under development. The approval of orphan drugs designation grants the incentives to the pharmaceutical companies in USA for marketing exclusivity for seven year to the first sponsor getting FDA approval for designated drug. A tax credit equal to 50 per cent of cost involved in clinical research. Exemption/Waiver in application (filing) fees. Assistance in the research related to drug development process and special grant funding to orphan products.

The orphan drug stimulus
In the European Union, companies with an orphan designation for a medicinal product benefit from incentives by protocol assistance (scientific advice during the product development phase). They are given the marketing authorization for 10-year marketing exclusivity and are given financial incentives in terms of fee reductions or exemptions and national incentives.

In the European Union, since 1 January, 2007, orphan medicinal products are eligible for the following level of fee reductions: 100 per cent reduction for protocol assistance and follow up; 100 per cent reduction for preauthorization inspections; 50 per cent reduction for new applications for marketing authorization; 50 per cent reduction for post authorization activities, including annual fees (applies only to small and medium sized enterprises), in the first year after grant of a marketing authorization.

The Food and Drug Administration (FDA) has charged The Office of Orphan Products Development (OOPD) to dedicate its mission to promoting the development of products that demonstrate promise for the diagnosis and/or treatment of rare diseases or conditions. It administers the major provisions of the Orphan Drug Act (ODA), which provide incentives for sponsors to develop products for rare diseases. The ODA has been very successful for more than 200 drugs and biological products for rare diseases have been brought to market since 1983. In contrast, the decade prior to 1983 saw fewer than ten such products come to market. In addition, the OOPD administers the Orphan Products Grants Program which provides funding for clinical research in rare diseases. The FDA funds the development of orphan products through its grants program for clinical studies. The Request for Applications (RFA) announcing availability of funds is published in the Federal Register each year usually in June. Eligibility for grant funding is extended to medical devices and medical foods for which there is no reasonable expectation of development without such assistance. Applications are reviewed by panels of outside experts and are funded by priority score.

Challenges in accessing and affordability of medicines for rare diseases
Despite the progress, no effective and safe treatment is available for many rare diseases. Furthermore, when treatments are available, obstacles are encountered that hinder access and use of these drugs.

High prices
Prices of orphan drugs per treatment episode can be very high. For example, the cost of treatment with enzyme replacement therapies may reach more than US$150,000 per treatment year. The affordability of orphan drugs has become a major issue for payers and is thus a strong driver of tensions between the different stakeholders. Some companies have responded to this by developing programs to facilitate access to orphan drugs. These obstacles to treating rare diseases with orphan drugs exemplify and mirror the global debate of deficiencies in bringing new drugs to patients who need them. Furthermore, advances in pharmacogenomics may lead to treatments benefiting a small subgroup of patients. Whatever the outcome, it seems inevitable that with an increasing number of drugs specifically indicated, and effective, for rare diseases, these medicines will feature more often on future public health agendas.

The future of orphan drug: Global outlook
As the Asian pharmaceutical markets grow, so too will opportunities for orphan drugs in Asia. Asian governments are becoming more aware of the importance of orphan drugs, and reimbursements for these products will increase in the future. Each Asian market, however, is different, and one must study each Asian country’s orphan drug regulations and markets to be successful.

Rare diseases need more attention due to lack of proper diagnosis and treatment. Treatment and prevention for rare diseases is considered as “no man’s land.” The EU parliament should provide more benefits like tax incentive, special status, and reimbursement for these orphan drugs. This encouragement can bring in a revolution among the pharmaceutical and biotechnology companies for developing and marketing orphan drugs. EURODIS and other organizations are creating awareness on rare diseases and are also influencing governments in bringing legislation acts for better quality of life for these special people. EURORDIS and National Alliances have announced “rare day” on February 29 and dedicated this day to special people who are affected by rare diseases. Henceforth, February 29 will be called “the rare disease day.”

The future of the orphan drug industry will depend heavily upon the entry of biogenerics, since biologics account for over 50 per cent of the orphan drug market. It can be expected that the orphan drug market growth will remain positive as more and more governments are taking action to promote this sector, especially in Asia.

India is in the process of establishing similar regulatory processes. With more countries adopting similar legislation, it can be expected that market potential will increase.

Pharmacogenomics is forcing a paradigm shift in patient care. An inevitable impact will be shrinking patient populations as this approach may eventually lead to a scenario where the majority of blockbuster drugs are suitable only for a small group of patients, the number of which may very well fall within the definition of rare diseases. Such developments could lead to a redefinition of the limits set by the ODA.

The issue of orphan drugs becomes more important for third world countries like India, which are affected the most. Why no new drug is coming up or nobody is investing in research and development (R&D) in malaria, leishmania, etc. Usually we criticize the pharmaceutical industry or manufacturers for this. This is a controversial issue. The manufacturers cannot be entirely blamed for this. It is not easy to produce and market orphan drugs. The manufacturers of drugs have to amortize their operational expenses, their research investment, and they have to make reasonable profit so that they can finance new ventures in the future. It is calculated that return on investment for the average new chemical entity (NCE) is barely 6-8 per cent, a figure with serious implications for a prudent businessman. One area where the ODA has not provided very strong incentives is new drugs and vaccines for the neglected diseases such as malaria and tuberculosis that affect poor countries. Given their low prevalence in the United States, diseases that predominantly affect poor countries are technically eligible for all of the incentive provisions of the ODA. However, developing countries lack the resources to afford these drugs, with many devoting as little as $2 per capita per year to heath care. Also R&D costs have been rising and drug prices declining. Hence these figures too suggest a flow from less attractive to more attractive alternatives for investment.
A country should try to produce important drugs for the benefit of the whole world, depending on the R&D investment, the return on such investment, the tax and patent incentives, and its regulatory policies. Agreement of these points might lead to beneficial changes in our national thinking and prevent “orphanization of new drugs.”

Conclusion
The orphan drug regulations made by different countries have proven as promoters in development of orphan drugs. The orphan drug regulation in the US and the EU has been successful in providing treatments to the patients with rare diseases. The orphan drug designations have increased drastically in the last few years. However, India in spite of having very large number of patients with rare diseases which can become a huge market for domestic pharmaceutical companies. The Government of India should therefore make legislation for regulation of orphan drugs and give some incentives to the pharmaceutical companies which could benefit both patients and pharmaceutical industries. This will also help many consumers who have genetic disorders and who can’t afford imported medication for these ailments. There is a big need for incentive based innovation and commercialisation for orphan drugs.