pharmaceutical companies need to guarantee commercial
returns from the new drugs they develop - so tough luck
if you suffer from a rare illness or live in a
developing country. But experience in the USA, Japan and
Australia shows 'orphan' drugs can be profitable.
I t costs an
million to develop a new drug. If pharmaceutical
companies cannot sell cures to millions of people, they
stand no chance of recouping huge research costs. So
it's hardly surprising they concentrate on potential
best-sellers: drugs for heart disease, ulcers, diabetes,
Alzheimer's disease, the common cold. Drugs for
unprofitable diseases, known as 'orphan' drugs, are
generally abandoned at birth.
Unprofitable diseases include those that are rare and
those in developing countries with no money to buy
expensive medications. Producing affordable therapies
for developing countries is difficult, but for
rare-disease sufferers there is more hope. By changing
legal constraints which affect profitability, we may
persuade pharmaceutical companies that rare diseases are
worth targeting. This approach seems to work elsewhere,
and now the European Parliament is tackling the issue.
Low incidence doesn't mean few
The label 'rare' is usually taken to mean that a
disease affects fewer than 7.5 people per 10,000. This
includes well-known scourges such as multiple sclerosis,
which affects some 500,000 people in Europe. The World
Health Organisation (WHO) estimates that there are
around 5,000 rare diseases, affecting 20 million people.
Rare diseases can be difficult to diagnose because
doctors tend to be unfamiliar with them. They are also
hard to cure: 50-80% are genetic in origin and require
high-tech remedies such as gene therapy rather than
traditional organic chemistry. But, argues the
Parliament's STOA Panel, most of the investment needed
for gene therapy will be in the development of basic
techniques which serve as a platform for other
treatments. Effectively, basic R&D costs for orphan
drugs are much the same as for any other drugs. To make
orphan drugs commercially attractive, something else
will have to change.
Lowering the barriers
In the USA and other countries with positive
experiences in orphan drug development, that something
is the regulatory framework. The US Orphan Drug Act of
1983 and its amendments give the developer an exclusive
seven-year marketing period to recoup development costs.
Orphan drugs also benefit from fast-track registration
and a 50% tax credit on clinical trials in the USA.
It seems to work. In 14 years, 890 substances have
been granted orphan drug status in the USA and 173 have
received marketing authorisation. Ninety-two
organisations have launched one or more orphan drugs. As
a result, an estimated 6.5 million American patients
stand to benefit.
Orphan drugs in Australia have an exclusive five-year
marketing period, exemption from the normal fees imposed
by the Therapeutic Goods Administration (TGA), and their
own registration procedure. In Japan, special status
granted to orphan drugs in 1993 has encouraged the
launch of 35 new formulae.
Progress in Europe
France, Spain, Sweden, Denmark, the UK and Germany
have all considered the status of orphan drugs, but
European harmonisation and commercial encouragement are
lacking. The EU now proposes official regulatory status
for orphan drugs, with full or partial exemption from
registration fees, an exclusive marketing period of ten
years, and help with clinical trials.
Tax breaks for R&D are a possibility too. In the
USA and Japan, around 40% of the organisations that have
licensed orphan drugs are small or medium-sized
pharmaceutical companies. This is remarkable in a
competitive climate which is forcing even the largest
firms to merge to offset the huge costs of drug
development. Orphan drugs represent a good opportunity
for small firms, and this, says the European Commission,
will help Europe remain competitive in the world biotech
Under the Fifth Framework Programme, research on rare
diseases will remain a priority.