Orphan Drug Development – Why They Are SO Important

Orphan drugs treat diseases so rare that sponsors are often unwilling to follow the usual pharmaceutical drug development marketing conditions. Most rare diseases are genetic, and therefore present throughout the sufferer’s life, even when symptoms are not immediately apparent. Many diseases appear early in life, and a total of 30 percent of children with orphan diseases die before the age of five. Global estimates put the number of different diseases between 5000 and 7000, with an average of five new conditions discovered every week. Unfortunately, in total, only 5 percent of orphan diseases have FDA approved treatment.?

Record Growth Shows Clear Commitment

Although the market is small for orphan drugs, pharmaceutical drug development in this area has seen notable growth in recent years. Currently, 350 orphan drugs are approved for sale in the U.S., including not only pharmaceutical and biological products but also medical devices and dietary products. A record number (10) of new drugs were approved by the FDA in 2011 along with five new drugs by the European Medicines Agency (EMA).

Proven Examples of Success

Orphan Drugs Find a Home

Orphan Drugs Find a Home at Criterium Global CRO

Many large pharmaceutical companies are expanding their orphan drug development and even establishing entire business units dedicated to rare diseases. Although orphan drugs treat only a small number of patients, they can receive a weighty revenue, and companies get a significant competitive advantage by being the first to market.?A good example is Rituxan? from Genentech, the second most profitable drug in the world, given orphan status to treat B-cell Non-Hogkin’s lymphoma. In 2010, it yielded $5.24 billion in sales for its use as an orphan drug and for extended usage for other types of cancer and rheumatoid arthritis.?It is quite possible to more than compensate for the smaller number of patients an orphan drug may help, through the increased market share, lower marketing costs, higher pricing, longer exclusivity period, and faster returns.

There is an even greater potential for profit when drugs have multiple orphan disease indications or if they can later go on to be used for more widespread non-orphan indications; for example, Gleevec? from Novartis Oncology resulted in sales of $2.4 billion in 2010. In addition, a number orphan drugs are biologics, meaning they are less likely to have generic equivalents, which extends the value to sponsors even after patent expiration.

Economically Feasible – Shorter Development Timelines

Investing in orphan drugs is at least as economically feasible as non-orphan pharmaceutical drug development due to the higher rates of approval and the shorter development times. For instance, the chances of approval for orphan drugs is very high, at 82 percent, compared to non-orphan drugs, at just 35 percent. Additionally, the time taken from Phase II to market is often shorter due to both smaller clinical trials and to the FDA Fast Track designation. On average, the timeline for orphan drugs is 3.9 years while traditional drugs typically take 5.4 years to reach the market.

With new orphan diseases being discovered every week, the potential for pharmaceutical drug development in this area is huge. While initially the market for these drugs may appear small, this is more than counterbalanced by the revenue opportunities and the quick time-to-market.

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