Economic considerations in the provision of treatments for rare diseases

Orphan Drug legislation in the USA, Europe and elsewhere has been incredibly successful in promoting the development of new treatments for rare diseases. Historically, payers have constructed special schemes that have facilitated patient access given the small total budget impact of these treatments. However, whilst each disease is rare, the number of licensed orphan drugs is growing rapidly. This, in conjunction with the high prices claimed for these treatments, has increased the total budget impact of orphan drugs. In the medium term, the feasibility of omitting orphan drugs from value for money type assessments is doubtful. The arguments for a special status for orphan drugs in reimbursement processes are reviewed in this article, and it is concluded that these arguments do not generally stand up to critical assessment. A new paradigm for the development and purchase of orphan drugs may be required. Given the strong parallels between the challenges of neglected diseases in developing countries and orphan diseases in developed countries, policy tools developed for neglected diseases; such as Public Private Partnerships and Advance Market Commitments, might be fruitfully applied in the orphan drug arena.