Orphan drugs (ODs) are medications used to treat rare medical conditions.
ODs can be expensive.
In order to qualify for incentives, pharmaceutical manufacturers can apply for orphan drug status with the FDA.
Since pharmaceutical manufacturers often can’t recover the costs of developing medications for rare diseases, there isn’t a lot of incentive for manufacturers to make medications to treat rare diseases. In fact, fewer than 10 rare disease medications received FDA approval between 1973 and 1983.
But in 1983, the U.S. government passed the Orphan Drug Act (ODA) to spur new development in OD medications to treat rare diseases. To date, the ODA has promoted the approval of more than 600 medications for rare diseases.
Here, we’ll discuss the development and approval process of ODs for rare medical conditions.
A rare disease is a condition that affects fewer than 200,000 people in the U.S. These medical conditions are usually serious or life-threatening. Currently, there are an estimated 7,000 rare diseases.
The FDA is an organization with many offices. Each office has different responsibilities — for example, the FDA Center for Devices and Radiological Health has the responsibility of making sure that people have access to high-quality medical devices and radiation-releasing products that are safe and effective.
For ODs, the mission of the FDA Office of Orphan Products Development (OOPD) is to support the advancement of diagnosis and treatment options for rare conditions. The OOPD is also responsible for granting orphan drug status (ODS) to a medication.
In general, ODS typically applies to two main conditions:
Medication development otherwise would be too costly: Without ODS, the manufacturer doesn’t expect to recover the expenses it took to develop the medication from sales within the U.S.
The medication is a treatment option for a rare disease: The manufacturer intends to develop a medication for a condition that affects fewer than 200,000 people in the U.S.
Contacting the FDA OOPD and applying for ODS is an important first step for manufacturers before applying for an Investigational New Drug (IND) application. IND approval is necessary for manufacturers to transport ODs across state lines for research purposes.
Throughout the OD development process, manufacturers will continue to stay in touch with the FDA, which can provide recommendations for research study designs, grants, and other incentives. Also, during patient-focused drug development (PFDD) meetings, the FDA gathers data and feedback from people with rare diseases, their family members, and disease foundations. The manufacturers can use information from these meetings to guide their decisions during OD development.
Although the FDA usually requires big clinical trials for most medications, large studies can be difficult to conduct for medications that target rare diseases — there aren’t nearly as many people who can be enrolled into these clinical trials compared to other clinical trials.
As a result, compared to clinical trials for more common conditions, there usually aren’t phase 1 safety studies on healthy volunteers. Instead, because there are fewer people, manufacturers often combine phase 2 and phase 3 studies to determine an OD’s safety and effectiveness in people who have the condition. For rare medical conditions, clinical trials might also include the following differences:
No blinding: Everyone will know who is receiving which treatment. In other clinical trials, in order to lower the risk of bias, people usually don’t know if they’re receiving the actual medication or a placebo — a substance with no medication in it.
No placebo: The study design will not have a control group of people to compare against the treatment group.
No randomization: The selection and sampling process of individuals isn’t random. In clinical trials for common medical conditions, randomization minimizes the differences between the control and treatment groups. If the groups are different, then the bias might affect research results.
After the manufacturer gathers sufficient effectiveness and safety data to support the OD’s use, the manufacturer can submit a marketing application — either a New Drug Application (NDA) or a Biologics License Application (BLA) — to the FDA.
Finally, upon receiving NDA or BLA approval from the FDA, the manufacturer can market the OD. But, the manufacturer could still be required to perform additional clinical trials. These are phase 4 (post-approval) studies that provide surveillance or follow-up after a medication is approved. This helps further ensure the OD provides benefits for people with rare medical conditions.
Manufacturers can receive funding through grants. The FDA provides grants through the Orphan Product Grants Program. The OOPD provides funding to help manufacturers conduct safety and effectiveness studies that have a high likelihood of resulting in FDA approval.
Lastly, the National Institutes of Health (NIH) National Center for Advancing Translational Sciences and the National Human Genome Research Institute work together to support the Genetic and Rare Diseases Information Center (GARD). GARD is a resource to help manufacturers with their study designs. GARD can also help direct manufacturers to additional funding opportunities.
Prescription Drug User Fee Act (PDUFA) exemption: In 1992, the U.S. Congress created the PDUFA, which allowed the FDA to collect fees from manufacturers. The fees are important in speeding up the medication approval process. However, if the manufacturer obtains ODS, the FDA will waive the NDA or BLA application fee, which can be over $2 million.
Orphan drug tax credit: The manufacturer receives a tax credit for a percentage of qualified study costs.
Market exclusivity: The manufacturer won’t have to worry about competition on the market for 7 years.
Free pricing: The manufacturer will have the freedom to set any price on the OD.
ODs can be expensive because manufacturers have control over prices, and individuals are often willing to pay for a treatment option for their rare medical conditions. Some examples of costly ODs include:
Myalept: Myalept (metreleptin) treats a condition that causes abnormal distribution of fat. This OD costs more than $5,000 for each vial.
Tibsovo: Tibsovo (ivosidenib) treats individuals with a particular genetic variation that causes acute myeloid leukemia (AML) — a cancer of the blood and bone marrow with too many immature white blood cells. The treatment option costs over $26,000 per month.
Zolgensma: Zolgensma (onasemnogene abeparvovec) is a gene therapy medication used to treat spinal muscular atrophy (SMA) — a condition that affects nerve cells in the brainstem and spinal cord. This is currently the most expensive drug in the U.S. — it costs about $2.1 million for a 12-month supply.
Want to read more about other ODs that are available? Click or tap here.
Although a rare disease affects fewer than 200,000 people within the U.S., these medical conditions are usually serious or life-threatening. Before the Orphan Drug Act (ODA) was passed in 1983, there were very few treatment selections available for individuals with rare conditions.
The passage of the ODA encourages manufacturers to develop medications for these rare diseases. Upon obtaining ODS from the FDA, manufacturers can receive many benefits and support to help with the OD development process.
Although the ODA has led to the approval of many medications for rare medical conditions since 1983, these ODs are usually costly.
American Cancer Society. (2018). What is acute myeloid leukemia (AML)?
Genetic and Rare Diseases Information Center. (n.d.). GARD.
Genetic and Rare Diseases Information Center. (n.d.). List of FDA orphan drugs.
National Cancer Institute. (n.d.). Orphan drug.
National Cancer Institute. (n.d.). Orphan drug designation.
National Cancer Institute. (n.d.). Neuroblastoma treatment (PDQ®)–patient version.
National Center for Advancing Translational Sciences. (2021). FAQs about rare diseases.
National Center for Advancing Translational Sciences. (2022). National center for advancing translational sciences.
National Human Genome Research Institute. (n.d.). National human genome research institute.
National Institute of Neurological Disorders and Stroke. (2021). Spinal muscular atrophy fact sheet.
National Organization for Rare Disorders. (n.d.). Jayne Holtzer research grant program.
Orphanet. (2022). Orphan drugs in the United States of America.
Progeria Research Foundation. (n.d.). About progeria.
Srivastava, G., et al. (2019). Orphan drugs: Understanding the FDA approval process. Academic Entrepreneurship for Medical and Health Scientists.
Suresh, K. P. (2011). An overview of randomization techniques: An unbiased assessment of outcome in clinical research. Journal of Human Reproductive Sciences.
U.S. Food and Drug Administration. (2011). Guidance for industry: User fee waivers, reductions, and refunds for drug and biological products.
U.S. Food and Drug Administration. (2014). Types of applications.
U.S. Food and Drug Administration. (2018). Developing products for rare diseases & conditions.
U.S. Food and Drug Administration. (2018). Orphan drug act - relevant excerpts.
U.S. Food and Drug Administration. (2018). Orphan products: Hope for people with rare diseases.
U.S. Food and Drug Administration. (2018). Step 3: Clinical research.
U.S. Food and Drug Administration. (2020). FDA organization.
U.S. Food and Drug Administration. (2021). Biologics license applications (BLA) process (CBER).
U.S. Food and Drug Administration. (2021). CDER patient-focused drug development.
U.S. Food and Drug Administration. (2021). Investigational new drug (IND) application.
U.S. Food and Drug Administration. (2021). Orphan products grants program.
U.S. Food and Drug Administration. (2021). Post-approval studies program.
U.S. Food and Drug Administration. (2022). Center for devices and radiological health.
U.S. Food and Drug Administration. (2022). Development & approval process | drugs.
U.S. Food and Drug Administration. (2022). New drug application (NDA).
U.S. Food and Drug Administration. (2022). Office of orphan products development.
U.S. Food and Drug Administration. (2022). Prescription drug user fee amendments.