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Public funding of drugsPublic funding of drugsfor orphan diseasesfor orphan diseases
Dyfrig Hughes PhDDyfrig Hughes PhD
Centre for Economics and Policy in HealthCentre for Economics and Policy in HealthUniversity of Wales, BangorUniversity of Wales, Bangor
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Orphan diseaseOrphan disease A disease which has not beenA disease which has not been adoptedadopted
by the pharmaceutical industry because itby the pharmaceutical industry because itprovides little financial incentive for theprovides little financial incentive for the
private sector to make and market newprivate sector to make and market new
medications to treat or prevent itmedications to treat or prevent it
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DefinitionsDefinitions An orphan disease may be:An orphan disease may be:
A rare disease. According to EU criteria, anA rare disease. According to EU criteria, anorphan disease is one with a prevalence of 5orphan disease is one with a prevalence of 5
cases or less per 10,000 populationcases or less per 10,000 population
A common disease that has been ignoredA common disease that has been ignored
(such as tuberculosis, cholera, typhoid, and(such as tuberculosis, cholera, typhoid, and
malaria) because it is far less prevalent in themalaria) because it is far less prevalent in the
developed world than in developing countriesdeveloped world than in developing countries
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DefinitionsDefinitions An orphan disease may be:An orphan disease may be:
A rare disease. According to EU criteria, anA rare disease. According to EU criteria, anorphan disease is one with a prevalence of 5orphan disease is one with a prevalence of 5
cases or less per 10,000 populationcases or less per 10,000 population
A common disease that has been ignoredA common disease that has been ignored
(such as tuberculosis, cholera, typhoid, and(such as tuberculosis, cholera, typhoid, and
malaria) because it is far less prevalent in themalaria) because it is far less prevalent in the
developed world than in developing countriesdeveloped world than in developing countries
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Focus on rare diseasesFocus on rare diseases European Agency for the Evaluation of MedicinalEuropean Agency for the Evaluation of Medicinal
Products (EMEA) supports R&D of orphan drugsProducts (EMEA) supports R&D of orphan drugsby providing a range of incentivesby providing a range of incentives
market exclusivity for ten years (monopoly)market exclusivity for ten years (monopoly)
reduction of licensing feesreduction of licensing fees
assistance with marketing applicationsassistance with marketing applications
direct access to the centralised procedure fordirect access to the centralised procedure for
marketing authorisationmarketing authorisation provision of specific research grantsprovision of specific research grants
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Focus on rare diseasesFocus on rare diseases European Agency for the Evaluation of MedicinalEuropean Agency for the Evaluation of Medicinal
Products (EMEA) supports R&D of orphan drugsProducts (EMEA) supports R&D of orphan drugsby providing a range of incentivesby providing a range of incentives
market exclusivity for ten years (monopoly)market exclusivity for ten years (monopoly)
reduction of licensing feesreduction of licensing fees
assistance with marketing applicationsassistance with marketing applications
direct access to the centralised procedure fordirect access to the centralised procedure for
marketing authorisationmarketing authorisation provision of specific research grantsprovision of specific research grants
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Market availabilityMarket availability Marketing approval of expensive orphan drugsMarketing approval of expensive orphan drugs
does not necessitate that health services funddoes not necessitate that health services fundsuch treatmentssuch treatments
Example:Example: laronidaselaronidase for MPS type I:for MPS type I: 180,000 per patient per year180,000 per patient per year
Approved for use in WalesApproved for use in Wales
Not approved in ScotlandNot approved in Scotland not a costnot a cost--effective use ofeffective use ofhealth care resourceshealth care resources
NSCAG in EnglandNSCAG in England EU survey: not funded in 4 out of 18 countriesEU survey: not funded in 4 out of 18 countries
NICE report on ultraNICE report on ultra--orphan drugs imminentorphan drugs imminent
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Market availabilityMarket availability Marketing approval of expensive orphan drugsMarketing approval of expensive orphan drugs
does not necessitate that health services funddoes not necessitate that health services fundsuch treatmentssuch treatments
Example:Example: laronidaselaronidase for MPS type I:for MPS type I: 180,000 per patient per year180,000 per patient per year
Approved for use in WalesApproved for use in Wales
Not approved in ScotlandNot approved in Scotland not a costnot a cost--effective use ofeffective use ofhealth care resourceshealth care resources
NSCAG in EnglandNSCAG in England EU survey: not funded in 4 out of 18 countriesEU survey: not funded in 4 out of 18 countries
NICE report on ultraNICE report on ultra--orphan drugs imminentorphan drugs imminent
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Market availabilityMarket availability Marketing approval of expensive orphan drugsMarketing approval of expensive orphan drugs
does not necessitate that health services funddoes not necessitate that health services fundsuch treatmentssuch treatments
Example:Example: laronidaselaronidase for MPS type I:for MPS type I: 180,000 per patient per year180,000 per patient per year
Approved for use in WalesApproved for use in Wales Not approved in ScotlandNot approved in Scotland not a costnot a cost--effective use ofeffective use of
health care resourceshealth care resources
NSCAG in EnglandNSCAG in England EU survey: not funded in 4 out of 18 countriesEU survey: not funded in 4 out of 18 countries
NICE report on ultraNICE report on ultra--orphan drugs imminentorphan drugs imminent
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Economic issuesEconomic issues Orphan drugs tend not to be costOrphan drugs tend not to be cost--effectiveeffective
(based on conventional(based on conventional 30,000 per QALY30,000 per QALYthreshold criterion)threshold criterion)
BortezomibBortezomib 32,280 / QALY32,280 / QALY
PegvisomantPegvisomant 105,119 / QALY105,119 / QALY
SodiumSodium phenylbutyratephenylbutyrate >>1m? / QALY1m? / QALY
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Should orphan drugs beShould orphan drugs be
considered differently?considered differently? After allAfter all
Evidence on clinical effectiveness is belowEvidence on clinical effectiveness is belowparpar
They are highly unlikely to be costThey are highly unlikely to be cost--effectiveeffective
Should inferior evidence be acceptable onShould inferior evidence be acceptable on
the basis that the disease is rare?the basis that the disease is rare?
Should priority be given to patients simplyShould priority be given to patients simplyon the basis that the disease is rare?on the basis that the disease is rare?
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Should orphan drugs beShould orphan drugs be
considered differently?considered differently? After allAfter all
Evidence on clinical effectiveness is belowEvidence on clinical effectiveness is belowparpar
They are highly unlikely to be costThey are highly unlikely to be cost--effectiveeffective
Should inferior evidence be acceptable onShould inferior evidence be acceptable on
the basis that the disease is rare?the basis that the disease is rare?
Should priority be given to patients simplyShould priority be given to patients simplyon the basis that the disease is rare?on the basis that the disease is rare?
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Methodological issuesMethodological issues Difficult to recruit an adequate sample sizeDifficult to recruit an adequate sample size
to test treatments for very rare diseasesto test treatments for very rare diseases Number of trial participants required forNumber of trial participants required for
adequate statistical powering oftenadequate statistical powering oftenexceeds total population with diseaseexceeds total population with disease
Ethical issues around use of placebo whenEthical issues around use of placebo when
no other treatment existsno other treatment exists RCTsRCTs rarely conductedrarely conducted
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Methodological issuesMethodological issues Difficult to recruit an adequate sample sizeDifficult to recruit an adequate sample size
to test treatments for very rare diseasesto test treatments for very rare diseases Number of trial participants required forNumber of trial participants required for
adequate statistical powering oftenadequate statistical powering oftenexceeds total population with diseaseexceeds total population with disease
Ethical issues around use of placebo whenEthical issues around use of placebo when
no other treatment existsno other treatment exists RCTsRCTs rarely conductedrarely conducted
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Methodological issuesMethodological issues Difficult to recruit an adequate sample sizeDifficult to recruit an adequate sample size
to test treatments for very rare diseasesto test treatments for very rare diseases Number of trial participants required forNumber of trial participants required for
adequate statistical powering oftenadequate statistical powering oftenexceeds total population with diseaseexceeds total population with disease
Ethical issues around use of placebo whenEthical issues around use of placebo when
no other treatment existsno other treatment exists RCTsRCTs rarely conductedrarely conducted
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Methodological issuesMethodological issues Difficult to recruit an adequate sample sizeDifficult to recruit an adequate sample size
to test treatments for very rare diseasesto test treatments for very rare diseases Number of trial participants required forNumber of trial participants required for
adequate statistical powering oftenadequate statistical powering oftenexceeds total population with diseaseexceeds total population with disease
Ethical issues around use of placebo whenEthical issues around use of placebo when
no other treatment existsno other treatment exists RCTsRCTs rarely conductedrarely conducted
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Case for special statusCase for special status Equity issuesEquity issues
RightsRights--based approachbased approach, in which individuals, in which individualsare entitled to a decent minimum of healthare entitled to a decent minimum of health
care, requires that funding is made availablecare, requires that funding is made available
for orphan drugsfor orphan drugs Rule of rescueRule of rescueproposes a commitment toproposes a commitment to
nonnon--abandonment of individuals with needsabandonment of individuals with needs
for highly specialised treatments, even infor highly specialised treatments, even inresourceresource--constrained settingsconstrained settings
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Case for special statusCase for special status Equity issuesEquity issues
RightsRights--based approachbased approach, in which individuals, in which individualsare entitled to a decent minimum of healthare entitled to a decent minimum of health
care, requires that funding is made availablecare, requires that funding is made available
for orphan drugsfor orphan drugs Rule of rescueRule of rescueproposes a commitment toproposes a commitment to
nonnon--abandonment of individuals with needsabandonment of individuals with needs
for highly specialised treatments, even infor highly specialised treatments, even inresourceresource--constrained settingsconstrained settings
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CounterCounter--argumentsarguments Equity principle is also used to argueEquity principle is also used to argue
againstagainstspecial considerationspecial consideration Funding of costFunding of cost--ineffective OD does notineffective OD does not bringbring
the greatest good to the greatest numberthe greatest good to the greatest number
Funding of OD implies that a patient with aFunding of OD implies that a patient with amore common condition, and who wouldmore common condition, and who wouldbenefit equally, is less worthy of receiving thebenefit equally, is less worthy of receiving the
treatmenttreatment
100,000 spent on drugs that are not cost100,000 spent on drugs that are not cost--effective iseffective is 100,000100,000 notnotspent on otherspent on othertherapies that are proven to be effective andtherapies that are proven to be effective and
costcost--effectiveeffective
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CounterCounter--argumentsarguments Equity principle is also used to argueEquity principle is also used to argue
againstagainstspecial considerationspecial consideration Funding of costFunding of cost--ineffective OD does notineffective OD does not bringbring
the greatest good to the greatest numberthe greatest good to the greatest number
Funding of OD implies that a patient with aFunding of OD implies that a patient with amore common condition, and who wouldmore common condition, and who wouldbenefit equally, is less worthy of receiving thebenefit equally, is less worthy of receiving thetreatmenttreatment
100,000 spent on drugs that are not cost100,000 spent on drugs that are not cost--effective iseffective is 100,000100,000 notnotspent on otherspent on othertherapies that are proven to be effective andtherapies that are proven to be effective and
costcost--effectiveeffective
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CounterCounter--argumentsarguments Equity principle is also used to argueEquity principle is also used to argue
againstagainstspecial considerationspecial consideration Funding of costFunding of cost--ineffective OD does notineffective OD does not bringbring
the greatest good to the greatest numberthe greatest good to the greatest number
Funding of OD implies that a patient with aFunding of OD implies that a patient with amore common condition, and who wouldmore common condition, and who wouldbenefit equally, is less worthy of receiving thebenefit equally, is less worthy of receiving thetreatmenttreatment
100,000 spent on drugs that are not cost100,000 spent on drugs that are not cost--effective iseffective is 100,000100,000 notnotspent on otherspent on othertherapies that are proven to be clinically` andtherapies that are proven to be clinically` and
costcost--effectiveeffective
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Options for policy recommendationsOptions for policy recommendations RiskRisk--sharing schemessharing schemes
Beta interferon andBeta interferon and glatiramerglatiramermoney might bemoney might bebetter used to fund a clinical trialbetter used to fund a clinical trial BMJ 326: 388BMJ 326: 388--9292
Designated central fundingDesignated central funding
Ease local pressuresEase local pressures Funding by Research CouncilsFunding by Research Councils
Compete for research fundingCompete for research funding
Restrict eligibilityRestrict eligibility Target those likely to benefit (how?)Target those likely to benefit (how?)
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SocietySocietys value on health gains value on health gain Ascertain whether the public places aAscertain whether the public places a
higher value on health gains achieved inhigher value on health gains achieved inpatients with rare and serious diseases,patients with rare and serious diseases,
compared with more common disorderscompared with more common disorders
WeightWeight QALYsQALYs accordinglyaccordingly
an explicit QALY weighting according toan explicit QALY weighting according to
disease prevalence would provide a ceiling fordisease prevalence would provide a ceiling fortreatments for rare diseasestreatments for rare diseases
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SocietySocietys value on health gains value on health gain Ascertain whether the public places aAscertain whether the public places a
higher value on health gains achieved inhigher value on health gains achieved inpatients with rare and serious diseases,patients with rare and serious diseases,
compared with more common disorderscompared with more common disorders
WeightWeight QALYsQALYs accordinglyaccordingly
an explicit QALY weighting according toan explicit QALY weighting according to
disease prevalence would provide a ceiling fordisease prevalence would provide a ceiling fortreatments for rare diseasestreatments for rare diseases
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Utility weighted by diseaseUtility weighted by disease
prevalenceprevalence
1
1000 10000 100000 1000000
Disease prevalence (UK cases)
UtilityWeighting
Decreased chanceof acceptance
Increased chance
of acceptance
100
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Where should the focus be?Where should the focus be? Rare diseases?Rare diseases?
Globally, MPS type I affects ~6000 childrenGlobally, MPS type I affects ~6000 children LaronidaseLaronidase sales figures was $42.6m in 2004sales figures was $42.6m in 2004
Neglected diseases?Neglected diseases?
Malaria causes 660 million acute illnesses and 3Malaria causes 660 million acute illnesses and 3million deaths per annummillion deaths per annum
Public spend onPublic spend on antimalarialsantimalarials in 2003/4 was $491min 2003/4 was $491m
100,000100,000 -- fold increase in burden of disease butfold increase in burden of disease butonly 10only 10 -- fold increase in spendfold increase in spend
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Where should the focus be?Where should the focus be? Rare diseases?Rare diseases?
Globally, MPS type I affects ~6000 childrenGlobally, MPS type I affects ~6000 children LaronidaseLaronidase sales figures was $42.6m in 2004sales figures was $42.6m in 2004
Neglected diseases?Neglected diseases?
Malaria causes 660 million acute illnesses and 3Malaria causes 660 million acute illnesses and 3million deaths per annummillion deaths per annum
Public spend onPublic spend on antimalarialsantimalarials in 2003/4 was $491min 2003/4 was $491m
100,000100,000 -- fold increase in burden of disease butfold increase in burden of disease butonly 10only 10 -- fold increase in spendfold increase in spend
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Where should the focus be?Where should the focus be? Rare diseases?Rare diseases?
Globally, MPS type I affects ~6000 childrenGlobally, MPS type I affects ~6000 children LaronidaseLaronidase sales figures was $42.6m in 2004sales figures was $42.6m in 2004
Neglected diseases?Neglected diseases?
Malaria causes 660 million acute illnesses and 3Malaria causes 660 million acute illnesses and 3million deaths per annummillion deaths per annum
Public spend onPublic spend on antimalarialsantimalarials in 2003/4 was $491min 2003/4 was $491m
100,000100,000 -- fold increase in burden of disease butfold increase in burden of disease butonly 10only 10 -- fold increase in spendfold increase in spend