“Orphan” Medication Proposal: A Windfall for Pharma, False “Cures” for Patients
A December 2015 press release from Public Citizen (Citizen.org) says that “Just one provision in the 21st Century Cures Act [passed in the U.S. House of Representatives] could cost U.S. taxpayers, private insurers, and patients $12 billion over 10 years, according to [our] analysis.”
In July 2015, the House passed the 21st Century Cures Act, a bill purported to provide “help and hope for patients through biomedical innovation.” Yet in many ways the “cure” presented by the legislation is a false one. The Senate has not yet released its draft of the House proposal.
Public Citizen’s report, “House Orphan Drug Proposal: A Windfall for Pharma, False ‘Cure’ for Patients,” focuses on just one of the costly problems with the bill: a provision that would allow pharmaceutical companies to charge high prices for brand-name medications for longer periods, in exchange for repurposing those medications to treat rare, or “orphan,” diseases that affect fewer than 200,000 patients nationwide.
The report comes as skyrocketing prescription medication prices are outraging doctors and patients alike. A U.S. Senate panel is investigating the price hikes, and the U.S. Secretary of Health and Human Services convened a forum last month to address the issue.
The orphan provision would give an extra six months of monopoly protection to manufacturers for medications granted an additional approval to treat an orphan disease. Since the extra six months of monopoly rights would apply to all the uses of the medication, not just the new orphan use, manufacturers likely would rush to find new uses for their most lucrative, blockbuster medications. The end result would be costly delays in patient access to lower-cost generics, including those used to treat much more widespread diseases.
Conservatively, the provision would cost U.S. taxpayers and patients around $4 billion over 10 years, but given the structure of the financial incentive, the cost could easily approach $12 billion over that time, Public Citizen concluded.
“Such a gift to the pharmaceutical industry is hardly necessary at a time when investment in orphan medications is already soaring,” said Dr. Sammy Almashat, a researcher with Public Citizen’s Health Research Group. “Worse, the costs of the new incentive would fall not only on taxpayers but also on the backs of patients with common, non-orphan diseases, who could be denied potentially life-saving, affordable generic medicines for six additional months.”
“The industry already receives special monopoly protections and taxpayer subsidies to develop orphan medications, and it reaps windfall profits as a result,” said Steven Knievel, campaign coordinator with Public Citizen’s Access to Medicines division. “This provision would not help get us better treatments for orphan diseases. It is simply a gift to the industry and evidence of the political influence of pharmaceutical companies.”
Further, the orphan medication approval system has serious flaws. For instance, orphan drugs are approved under substantially lower safety and efficacy standards, and there is often widespread off-label use of these products beyond the targeted orphan patient group, resulting in potentially unsafe or ineffective products being used in patient populations far larger than the orphan threshold of 200,000.