Orphan Drug Rules Manipulated By Industry To Create Prized Monopolies : Shots - Health News Drugmakers have brought almost 450 orphan drugs to market and collected rich incentives by doing so. But nearly a third of the medicines aren't new or were repurposed many times for financial gain.
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Drugs For Rare Diseases Have Become Uncommonly Rich Monopolies

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Drugs For Rare Diseases Have Become Uncommonly Rich Monopolies

Drugs For Rare Diseases Have Become Uncommonly Rich Monopolies

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We have an investigation this morning of drug companies gaming a system designed to help desperate patients. It's a story of orphan drugs.


These are life-saving drugs that pharmaceutical firms don't develop because they wouldn't help enough people to be profitable. People with rare diseases are left with no health.

INSKEEP: Orphan drugs were a big issue decades ago and were featured on an old TV show, "Quincy, M.E."


UNIDENTIFIED ACTOR: (As character) The truth is that the only real chance of research money going to these diseases is if you, the Congress, make the orphan drug bill a reality.

GREENE: And Congress did make the Orphan Drug Act a reality in 1983. It offers incentives to companies that develop drugs for rare diseases.

INSKEEP: Now, a Kaiser Health News investigation finds drugmakers are manipulating the system to collect the incentives. Sarah Jane Tribble has the first of two stories.

SARAH JANE TRIBBLE, BYLINE: A few years ago, something strange began to happen in the world of drug development. The FDA was approving a growing number of drugs that had been given orphan status. Orphan drugs, so-called because they were once abandoned by large pharmaceutical companies, are defined as those that treat a disease that affects fewer than 200,000 people. By 2015, 47 percent of new medications were orphan drugs. That raised red flags for medical researchers like Dr. Martin Makary at Johns Hopkins University medical school because many of these are household names.

MARTIN MAKARY: Some of these medications clearly serve large populations and to find out that they've been submitted for orphan drug approval for a very narrow indication when we all know in the real world they're being used broadly.

TRIBBLE: They include familiar names like arthritis drugs Enbrel, Remicade and Humira. In fact, 7 of the 10 top-selling drugs of any kind in the U.S. in 2015 were orphan drugs, and Makary says this is a big problem.

MAKARY: What we're doing is diluting the impact of the Orphan Drug Act to create incentives for companies to develop drugs for diseases that really do affect underrepresented populations in medicine.

TRIBBLE: The Orphan Drug Act gives companies three economic incentives. The biggest one is market exclusivity. So it's a government promise of no direct competition for your drug for seven years when treating that disease. The other incentives are tax credits and a couple of million in savings on fees paid to the FDA.

GAYATRI RAO: There are still tremendous unmet needs that are out there.

TRIBBLE: Dr. Gayatri Rao runs the FDA's Office for Orphan Products. She says she knows there's talk that companies are taking advantage of the system. It's her job to safeguard the law.

RAO: I want to ensure that we continue to keep our eye on that prize and we ensure that we utilize the Orphan Drug Act in a way that the framers really intended.

TRIBBLE: But it's not clear if that is happening. The Kaiser Health News investigation reveals more than 70 orphan drugs were approved to treat common diseases before winning an approval to treat a rare disease and, with that, the financial incentives that come with being an orphan drug. Bernard Munos is a former executive at drug giant Eli Lilly and now with FasterCures at the nonprofit Milken Institute. He reviewed our analysis and was surprised.

BERNARD MUNOS: I looked into it and the more I looked into it and the more I discovered that there is something there that is going on that doesn't seem to be in keeping with the intent of the law. It looked like somewhere some smart person perhaps had found a way to hijack the system, but it had become, according to the data, it looked very pervasive.

TRIBBLE: Munos says there are drugs that meet the spirit of the law - helping small populations of patients. He questions so whether some drugs, particularly the drugs that were already on the market, should get the financial incentives.

MUNOS: We're wasting resources. We're not doing any good. We're not adding any patient to the population of those that could benefit from the drug. As far as the patients are concerned, it is a complete waste.

TRIBBLE: Top-selling drug Humira won five approvals for orphan treatments after 2002 when it was already on the market to treat millions of people who suffer from rheumatoid arthritis. AbbVie, the maker of Humira, declined to comment on why it sought multiple orphan approvals for their drug. Anne Pritchett of PhRMA says drugmakers are following the science, and she warns that the Orphan Drug Act's incentives are necessary to support the research and development of life-saving drugs.

ANNE PRITCHETT: When you look at cystic fibrosis, it was 25 years to the development of an effective therapy. I think we would be concerned about anything that would undermine the current incentives.

TRIBBLE: Treatments for cystic fibrosis have been hugely successful, and they are hugely expensive. The FDA's Dr. Rao says the law is still needed to create drugs for about 7,000 rare diseases that have no treatments. But after being briefed on what we found, she also wants to examine the issue more closely.

RAO: Where I am is I want to understand more what the truth is really.

TRIBBLE: Rao says some drugs should get more than one approved use because there are scientific benefits to studying specific rare diseases. Still, she worries about companies using the law to drive up the prices of drugs.

RAO: Our goal is to try to get it right, you know, like, figure out what the right balance is and making sure that we're appropriately incentivizing things.

TRIBBLE: The FDA is doing its own evaluation of the drugs that want orphan status during 2010 and 2015. If necessary, the agency could propose changes to the Orphan Drug Act's regulations. I'm Sarah Jane Tribble in Washington.


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