Breakthrough therapies for rare diseases command premium prices, particularly if no alternatives exist
The global orphan drugs market presents plenty of opportunities for new drug development; while there are only 172 approved orphan drugs, more than 6,800 orphan diseases exist, according to the US National Institute of Health (NIH). Advances in biomedical research coupled with regulatory and financial incentives are helping to generate rich pipelines of treatments with real disease-modifying properties rather than palliative care or symptom management. Examples include Alexion's Soliris and Vertex Pharmaceuticals' Kalydeco for cystic fibrosis.
New analysis from Frost & Sullivan's Product and Pipeline Assessment of the Global Orphan Drugs Market identifies rare cancers as the orphan therapeutic area with the highest level of development activity. Other growing areas include blood/lymphatic system diseases, infectious/parasitic diseases, neurological diseases, metabolic diseases, and immunological/inflammatory diseases.
The global orphan drugs market is becoming increasingly competitive
'In the past, pharmaceutical and biotechnology companies rarely developed new drugs to treat rare diseases due to the low return on investment realised because of the small patient population,' says Debbie Toscano, Frost & Sullivan's Life Sciences Senior Industry Analyst. 'Now, drug discovery for orphan diseases is becoming an important element of the business models of numerous small and large pharmaceutical and biotechnology companies looking to strengthen their presence in the global market.'
As a result, pharmaceutical and biotechnology companies are introducing orphan drugs that use diverse approaches such as small molecules, antisense, gene therapy, monoclonal antibodies, bi-specific antibodies, peptide therapies, and stem cell therapies. Currently, such therapies command premium prices due to the huge clinical benefits they offer and the lack of alternative treatments for patients. Soon, however, they will have to be sold at competitive prices as the existing level of reimbursement will become untenable.
'As drug developers abandon the blockbuster model in favour of greater focus on drug development for rare conditions, the global orphan drugs market is becoming increasingly competitive,' adds Toscano. 'It is imperative that drug developers continually keep a tab of competitors' pipelines since approval and reimbursement of new orphan drugs are highly dependent on the availability of alternative therapies.'