Orphan drugs are drugs that are exclusively developed and used for treating rare diseases. Orphan drugs are not researched and developed for widespread use, since by their nature, they are meant only for rare diseases. Since by definition, a rare disease is not likely to have too many patients; orphan drugs are limited in their research, development and eventually, the market.
Situation governing orphan drugs in the USA
Different countries and markets have their own rules for how orphan drugs are developed and marketed. Orphan drugs in the USA have rules designated as to their application. Three major aspects mark out the rules relating to orphan drugs in the USA:
Liberal rules for clinical research
One, there are sufficient leniencies relating to the conduct of the clinical research for the orphan drugs in the USA. The requirement that non- orphan drugs in the USA need to make in relation to sample size does not apply to orphan drugs in the USA. This is natural, considering that fixing a sample size for the clinical research makes no sense, since in many cases, the full number of people suffering from the rare disease, that is, the people for whom the drug is being developed, could be quite nominal. In such instances, it will not be possible for the study to gather a big sample trial size.
Stresses the role of governments
Secondly, research and development of orphan drugs in the USA requires the intervention of the government, not-for-profit organizations that fund such activities, and philanthropy for support. In the case of non-orphan drugs in the USA; there are sufficient incentives for full-scale development and monetization. This is not so in the case of orphan drugs, since as noted, the population needing the drug could be miniscule.
Unencumbered approval process
As an offshoot of these two factors, the FDA has made the approval process of orphan drugs in the USA extremely easy and simple. Again, this is also based on the same logic that governs the entire nature of orphan drugs in the USA: their need in people who do not belong to the general population. To bring about incentives for orphan drugs in the USA; the federal government has passed The Orphan Drug Act.
The Orphan Drug Act
As a means to concretize the role of orphan drugs in the USA; the US administration passed the Orphan Drug Act in 1983. Aimed at encouraging firms to take up development of drugs for products with a very limited market, the Orphan Drug Act has the following features:
- It makes manufacturers of orphan drugs eligible for incentives such as a seven-year exclusivity
- It offers tax rebates of up to half of all their costs spent on research and development, and several other tax incentives for clinical trials of orphan drugs in the USA.