The Orphan Drug Act extends market exclusivity for branded drugs by seven years if approved to treat a rare disease. This has stimulated research and development into rare diseases, but it also allows manufacturers to forestall generic competition. Furthermore, drug companies can apply for more than one orphan designation and further extend the exclusivity period. This paper analyzes U.S. orphan drug approvals filed between 1983 and 2017.
We find a total of 432 branded drugs were approved for 615 orphan indications, of which 108 had multiple indications. Market exclusivity, beyond the initial 7 years, increased by 4.7 years with two orphan approvals, and there were 3.1-, 2.7-, and 2.9-year extensions for three, four, and five approvals, respectively. Drugs with five approvals averaged 13.4 additional years of exclusivity. Sixteen drugs had exclusivity periods extending at least 1 decade beyond the original exclusivity period. The potential budget impact of additional exclusivity was estimated at US$591 billion for 7 years following the end of the first approval.
Policymakers should consider limiting the total number of rare disease approvals or exclusivity period that a single drug could generate.
The full study can be found here.
Citation: Padula, W. V., Parasrampuria, S., Socal, M. P., Conti, R. M., & Anderson, G. F. (2020). Market Exclusivity for Drugs with Multiple Orphan Approvals (1983–2017) and Associated Budget Impact in the US. PharmacoEconomics, 1-7.