1697MO - Spending on and beneficiaries of orphan cancer drugs for ultra-rare, rare, and common diseases

Background

The Orphan Drug Act of 1983 not only incentivizes drug development for rare (200,000-6,600 affected US citizens), but also for ultra-rare (<6,600 US citizens) and subsets of common diseases (>200,000 US citizens). This study estimates Medicare & Medicaid spending on and beneficiaries receiving ultra-rare, rare, and common orphan cancer drugs to understand their budget impact and usage.

Methods

We identified 153 cancer drugs with FDA approval in the Drugs@FDA database (2000-2022). Drugs were group into non-orphan, common orphan (>200,000 patients), rare orphan (6,600 to 200,000), and ultra-rare orphan (<6,600) according to the number of affected US citizens as published by the Global Burden of Disease study. Drug spending and the number of beneficiaries for Medicare Part D and B & Medicaid were obtained from public documents. We calculated and compared total and average spending on and the total number of beneficiaries receiving non-, common, and rare orphan cancer drugs.

Results

Medicare & Medicaid data were available for 118 on-patent drugs. Overall spending increased from $8.8 to $26.5 bn (2016-2020). In 2020, 2% ($0.5 bn) were spent on ultra-rare, 31% ($8.2 bn) on rare, 30% ($8.1 billion) on common, and 37% ($9.7 bn) on non-orphan drugs. In 2020, average spending was lower for ultra-rare and rare than common and non-orphan drugs ($70 vs 155 vs 323 vs 295 million, p=0.005). A total of 171,260 and 357,464 beneficiaries received novel cancer drugs under Medicare & Medicaid schemes in 2016 and 2020, respectively. Of these, 2% (6560) suffered from ultra-rare, 27% (97,319) from rare, 31% (111,125) from common, and 40% (142,460) from non-orphan diseases. The average number of beneficiaries per drug was lower for ultra-rare and rare than common or non-orphans (1093 vs 1098 vs 4445 vs 4452 beneficiaries, p=0.015) in 2020.

Conclusions

Significant resources are spent on orphan drugs for diseases affecting more than 200,000 US citizens, whilst shifting the FDA's and taxpayers' resources away from truly rare or ultra-rare diseases. Congress could either create three distinct special orphan designations (ultra-rare, rare, and common) or differentially tie the Orphan Drug Act's incentives to the treated disease’s prevalence.

Clinical trial identification

Editorial acknowledgement

Legal entity responsible for the study

The authors.

Funding

Has not received any funding.

Disclosure

All authors have declared no conflicts of interest.