Is Orphan Designation a Driver of Orphan Drug Pricing

Objectives Policy makers pay more and more attention to the orphan drug market. Pharmaceutical companies are suspected to take advantage of the legislation. Moreover, granted an orphan designation (OD) could be associated with higher prices. The aim of this work is to assess the impact of the current European orphan drug legislation on prices within the rare disease market of the largest University Medical Center in France (AP-HP). Methods We included all drugs with exclusively rare disease indications, with or without (control group) European OD prior to European marketing authorization. We collected 2011 AP-HP prices and additional characteristics: prevalence of rare diseases; alternative drug existence and improvement in medical benefit (ASMR) assessed by the French National Authority for Health (HAS). Results From drugs indicated for rare diseases available in AP-HP, we retrieved those for which all additional characteristics were documented: 41 drugs with OD, 17 without OD. The contribution to the growth of the overall drug expenditures in AP-HP reached 1.16 points out of 3.40 points for OD drugs (99% of growth was explained by 3 drugs) and 0.39 for non OD drugs. No statistically significant difference in the price distribution was found between OD drugs (median: €180.4; interquartile range: €679.9) and non OD drugs (median: €443.9; interquartile range: €1433.1) (p=0.19). The price distributions were scattered (standard deviation: 1040.2 and 3512.1 respectively). Other characteristics between the two groups were not statistically different. Conclusions Concerns on the growing budgetary pressure of orphan drugs may affect social solidarity, and yet this study underlines the heterogeneity of the rare disease market. From these study results, OD approval should not be considered as the only price inflation cause. If the legislation should be adapted to limit windfall effects for pharmaceutical companies, the support of innovation in a fairness and egalitarian way is needed.