Latest Trends in Orphan Drug Pricing and Reimbursement
Latest Trends in Orphan Drug Pricing and Reimbursement
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It is now some 35 years since the passage of the first law designed specifically to encourage investment in the discovery and development of rare disease treatments. Activity in the sector has been transformed since then.
Publisher: Datamonitor Healthcare
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It is now some 35 years since the passage of the first law designed specifically to encourage investment in the discovery and development of rare disease treatments. Activity in the sector has been transformed since then. Once a neglected backwater, orphan drug development is now the subject of a research boom that is delivering innovative new treatments for rare diseases to the market in unprecedented numbers. Many carry premium price tags, and while overall pharmaceutical market growth rates have slowed, spending on orphan drugs is rising at double-digit rates.
Recent trends have sparked a debate on the structure of existing orphan drug laws, which critics say have been overtaken by scientific developments and are being exploited by the pharmaceutical industry. Regulators in both the US and Europe have announced plans to review current legislation, but opposition to substantive amendments on both sides of the Atlantic is strong, and major change appears unlikely in the foreseeable future. In the meantime, payers are being asked to fund orphan drug coverage bills that will reach new heights as the first wave of gene therapy products reaches the market. With their budgets under growing pressure, payers in most markets have begun to push back, implementing measures designed to limit their exposure to costs associated with orphan drug reimbursement.
This report provides a detailed analysis of orphan drug coverage, funding, and pricing systems in the US, Japan, and the EU’s five biggest pharmaceutical markets (France, Germany, Italy, Spain and the UK). It also tracks recent developments in orphan drug pricing and reimbursement across these seven countries, and describes the impact of those changes on rare disease treatments in general, and on specific products in particular. Finally, it addresses some of the major issues facing payers and orphan drug manufacturers, highlighting the way these have been handled by both parties through individual case studies.
Table of Contents
7 EXECUTIVE SUMMARY
7 Orphan drug coverage is beginning to test payer budgets
7 Some P&R frameworks are ill-equipped to deal with orphan drugs
7 Payers have begun to take evasive action
8 Some orphan manufacturers have learnt expensive lessons
10 THE ORPHAN DRUGS EXPLOSION
10 Incentivizing investment in orphan drug R&D
11 From backwater to boom
16 Time for a rethink of orphan drug rules?
18 Payers are looking for ways to rein in orphan drug costs
19 Bibliography
22 ORPHAN DRUG COVERAGE, FUNDING, AND PRICING
22 Established systems reflect a benign approach to orphan coverage
26 Raising the orphan P&R bar
34 Bibliography
40 US
40 Still few constraints on orphan coverage or prices
40 Orphan-specific P&R rules are notable by their absence
44 Rising orphan costs begin to prompt closer scrutiny
49 Bibliography
54 UK
54 Orphan coverage reflects fragmented regulatory framework
59 Payers turn the screw as NHS funding crisis bites
62 Bibliography
65 FRANCE
65 New pressures on orphan drug prices emerge
65 Orphan-specific rules focus on pricing, not reimbursement
68 Payers seek increased leverage over orphan prices
73 Bibliography
75 GERMANY
75 Payers toughen stance on orphan prices
75 Orphans are reimbursed widely, but price is an issue
79 Calls for a tighter line on orphan P&R are growing
83 Bibliography
86 ITALY
86 MEAs will remain the key to orphan access
86 Most orphans benefit from special provisions for “innovative” drugs
89 Payers may shift the focus of MEAs as orphan spend rises
93 Bibliography
95 SPAIN
95 Orphan coverage hit by healthcare funding crisis
95 National decisions determine orphan P&R status
96 Orphan P&R approval rates plunge as funding crisis bites
100 Bibliography
102 JAPAN
102 P&R overhaul will have implications for orphans
102 Reimbursement is comprehensive, but prices are tightly regulated
104 Spending surge prompts new P&R reform drive
106 Bibliography
108 ORPHAN DRUG CASE STUDIES
108 Experience, and lessons learned
108 Data limitations pose a challenge for regulators, as well as payers
109 Payers crave certainty, where often there is none
110 Maximizing prospects for positive P&R outcomes
113 Case studies
113 Glybera and Strimvelis – salutory lessons for gene therapy pioneers
115 Orkambi – offering less to more proves a hard sell for Vertex
117 Exondys 51 – Sarepta works hard to win over skeptical payers
119 Imbruvica – highlighting the P&R gulf between Europe and the US
121 Kymriah and Yescarta – CAR-T pioneers break the US pricing mold
LIST OF TABLES
122 Translarna – efficacy queries plague commercialization efforts
124 Jakafi/Jakavi – strong data the platform for commercial success
127 Bibliography
134 APPENDIX
134 About the author
134 Scope
134 Methodology
LIST OF TABLES
11 Table 1: Orphan drug definitions and development incentives
12 Table 2: Orphan drug indication approval numbers in the US, EU, and Japan
14 Table 3: Lenalidomide orphan designations, marketing authorizations, and indications in the US
15 Table 4: Global sales of Revlimid (lenalidomide)
17 Table 5: Orphan status of oncology drugs approved by the FDA in 2016
25 Table 6: Overview of approaches to orphan drug P&R in the US, Japan, and Europe
27 Table 7: Turning the screw on orphan drug reimbursement
30 Table 8: Potential solutions to the orphan drug funding challenge
32 Table 9: Leveraging pressure on orphan drug prices
43 Table 10: Relative exposure of marketplace plan holders to orphan drug costs
54 Table 11: Access to orphan drugs in the five major EU markets
57 Table 12: NICE appraisal outcomes
58 Table 13: Positive ultra-orphan drug appraisals by NICE
59 Table 14: Patient access schemes for orphan drugs recommended by NICE
62 Table 15: Ultra-orphan drugs in the NICE appraisal queue
67 Table 16: ASMR scores for new orphan drugs reviewed recently by HAS
71 Table 17: Change in ASMR rating following orphan drug reassessment
77 Table 18: Comparison of G-BA benefit assessment outcomes for orphan and non-orphan drugs*
89 Table 19: Orphan drug monitoring programs linked to performance-based MEAs
90 Table 20: Orphan drug spending and consumption trends in Italy
91 Table 21: Orphan drugs being bankrolled by AIFA’s new innovative drug funds
92 Table 22: Benefits conferred on innovative drugs by AIFA’s new algorithm
98 Table 23: Main contributors to hospital spending on orphan drugs in Spain
99 Table 24: Decline in P&R approval rates for non-cancer orphan drugs in Spain
108 Table 25: Flexible approach to the regulatory review of orphan drugs in the US
116 Table 26: Orkambi takes off in the US, but struggles elsewhere
126 Table 27: Global sales of ruxolitinib
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