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Outlook for orphan PRMA environment in the US, EU4, and UK.
The biopharmaceutical industry is always trying to maintain the balance between innovative investments in new therapy areas and ensuring patients have access to these therapies. The orphan/rare diseases landscape has also been largely driven by this balance, though the equilibrium has greatly been dependent on the regulations that attempt to ensure continuous innovation. There has been debate rumbling in the last few years, around the effectiveness of these regulations; and is expected to continue.
A recent analysis by MME—an Indegene pricing, reimbursement, and market access (PRMA) business—regarding market access trends for orphan drugs in the US, EU4, and UK revealed that the US leads the pack in terms of speed to access for orphan medicines. The time to market in European countries varies depending on the local filing requirements and pricing negotiations. While the time to market in France, Italy, and Spain is declining, the percentage of approved drugs reaching patients has also been reduced. For instance, between 2017–2020 in Spain, patients had access to only 41% of all EMA-approved therapies and 29% of approved orphan drugs.
In general, while orphan therapies constitute a relatively small percentage of overall healthcare budgets, with the percentage of orphan regulatory approvals rising, the spending on orphan therapies has seen a steady rise. Sustainable policies to increase the number of orphan therapies in the market have some inbuilt challenges when it comes to clinical development. A smaller number of patients for each rare disease means that the orphan therapies are often launched with less robust data demonstrating effectiveness around mortality, morbidity, or effect on the quality of life. This leads to challenges regarding meaningfulness and willingness to pay for the treatments.
That said, 40% of new therapies under development today are for rare diseases. This is likely to add pressure to healthcare systems, especially in Europe, where questions are already being raised around fair access to orphan therapies.
A review of the EU orphan drug regulation is currently ongoing to address loopholes including inequitable access to orphan drugs. Meanwhile, payers across individual countries are developing their own mechanisms to address their approaches to these drugs. The criteria for highly specialized technologies (HST) by National Institute for Health and Care Excellence (NICE), in England, ensures that only rare diseases that affect less than 300 patients and that can substantially reduce the life span of a patient are eligible to be qualified as HSTs. Likewise, France and Italy are tightening the inclusion criteria for early access programs—only “truly innovative” orphan therapies are eligible and for shorter timeframes than in the past.
In Germany, the “orphan drug loophole” is likely to be narrowed and may be applicable to a smaller subset of orphan products based on certain criteria that are getting defined. The loophole was initiated when AMNOG was implemented in 2011, providing an “additional benefit” to any drug approved with an orphan designation. The provision though has remained controversial. The tightening of these criteria is likely to see a smaller number of drugs qualify, below the approximate 10% of the market that qualifies today. Changes seem more likely than ever, although their final form is not yet clear.
The proposed changes in Europe’s orphan drug regulation increase the probability of reduced patient access to these therapies. For example:
• Reducing the number of patients to qualify for the orphan drug designation would mean therapies for only extremely rare diseases would meet it. This could lead to an increase in the economic and scientific challenges in developing them.
• Reforms like shorter market exclusivity, reduced opportunities for pre-EMA access in France and Italy, as well as the narrowing of the “orphan drug loophole” in Germany would reduce incentives for investors, potentially driving them away from orphan therapies.
• Drug-pricing pressures in the US could also shift the environment for rare diseases.
Ensuring the right health system incentives becomes essential to promote continuous therapeutic innovation toward delivering effective treatments for patients with rare diseases within a productive industry. Dialogue is therefore much needed between drug manufacturers, payers, policymakers, and regulators to ensure sustainable development of orphan drug therapies and to restore the balance between developing treatments for rare diseases and ensuring access for patients.
A copy of the whitepaper on changes in the market access landscape for orphan drugs can be accessed here. A blog that specifically talks about the German payers’ insights on the proposed reforms can be accessed here.
Note: exchange rate considered: €1.00=US$1.02