The Pull and Tug on Orphan Drug Development

FDA has been working overtime to streamline and accelerate research and approval of therapies to treat rare diseases, many life-threatening and affecting children. Last year was a record year for orphan drugs, as FDA approved 77 therapies with new orphan indications and granted 476 orphan drug designation requests. Since the

Jill Wechsler

landmark orphan drug program was established in 1983, FDA has approved more than 650 therapies for rare diseases, and more medical devices for orphan conditions are emerging. FDA’s accelerated approval and breakthrough therapy initiatives further encourage R&D on rare disorders.

At the same time, the high cost of many orphan drugs and concerns about biopharma companies gaming exclusivity policies to limit competition has undermined public support for incentives driving rare disease research. These tensions were apparent as Congress moved to eliminate the orphan drug tax credit as part of the Trump administration’s broader tax reform legislation enacted in December 2017. The policy permits sponsors to deduct from taxes half the cost of conducting clinical trials for therapies designated by FDA as orphan drugs. The final tax bill softened the proposed cutback to allow continued deduction of 25% of research costs. But Jim Greenwood, CEO of the Biotechnology Innovation Organization, predicted that the change will make it harder for small biotech companies to raise the funds needed to develop therapies for small patient populations. 

Further Congressional proposals raise additional challenges. There is talk of narrowing an exemption for rare disease therapies from the 340B drug pricing program, which permits orphan drugmakers to avoid extra discounts to certain hospitals and providers. Policymakers question whether orphan drug tax credits and added exclusivity should be awarded to firms repurposing older, common drugs with a secondary indication for a rare condition. Similar concerns have emerged over benefits for drugs initially approved as orphans that subsequently gain wider uses. FDA took action last December to close a loophole allowing companies to avoid pediatric testing requirements when developing a widely used drug to treat a rare pediatric condition.  

Faster designations

Meanwhile, FDA is working with biopharma companies and patient groups to bring more rare disease remedies to market. An early initiative by FDA Commissioner Scott Gottlieb was to update the agency’s process for assessing orphan designation requests from sponsors. FDA’s Office of Orphan Product Development (OOPD) faced a backlog of some 200 requests due to steady increases in such submissions-568 designation requests in 2016, and more than 700 last year. An FDA action plan issued in June 2017 helped clear up the backlog and established a 90-day timeframe for processing new designation requests. In February, FDA announced further actions to make it easier and faster for sponsors to submit designation requests and for FDA to review them. 

More efficient R&D may come from proposals for innovative clinical trial designs with more meaningful endpoints and greater use of real-world evidence in orphan drug development. FDA and sponsors are working with patient advocacy groups to better define endpoints and study inclusion criteria and to obtain patient preference information, experience data, and patient-reported outcomes from clinical studies. A draft guidance issued by FDA in December 2017 encourages sponsors of rare pediatric disease therapies to join multi-drug, multi-arm trails to reduce the number of children needed to test new therapies for U.S. and foreign markets. 

A related strategy is to establish natural history models of rare diseases to reduce the need for placebo arms in small studies, where patient recruiting is particularly difficult. FDA and the National Institutes of Health funded six natural history studies last year, and FDA’s Gottlieb plans to use some of a budget increase for 2019 to support clinical trial networks able to enhance understanding of the natural history and clinical outcomes of rare diseases. 

FDA also announced in February a collaboration with the National Organization for Rare Disorders (NORD) on initiatives to further incorporate patient experience into clinical trial design and development programs. A public workshop in May will address how FDA should evaluate orphan drug designation requests for molecularly defined diseases, noting that tissue agnostic therapies that target a cancer tumor’s genetic features, rather than tumors in specific body organs, may alter the definition of “disease” and the appropriate application of orphan drug incentives.  

These initiatives won’t completely quiet the debate on the regulatory framework and role of incentives in spurring rare disease research. Recent analysis indicates that many orphan drugs are approved for market much faster than non-orphan therapies. That raises questions about whether to continue basing the orphan designation on treatments for less than 200,000 patients, or to vary that standard to reflect potential for a new rare disease treatment to gain broader uses in the future. 

Jill Wechsler is the Washington Correspondent for Applied Clinical Trials.