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European Biopharmaceutical Review

New Twists for Orphans

Orphan drugs are a hot area in drug development, and when authorities unveil new regulatory methods of work and fresh incentives, product development professionals need to hurry to catch up. This has been the case with the FDA Safety and Innovation Act (FDASIA), which was passed in the US in 2012, but is only now coming into full recognition, and with the procedures under which the FDA's Office of Orphan Products Development (OOPD) is doing business. These changes offer exhilarating opportunities to advance products into the marketplace in new ways.

Meeting Policies

Since 1983, the FDA’s OOPD has been the drug developer’s fi rst stop on the regulatory train. OOPD takes considerable pride in being helpful to wide-eyed novices with good ideas for the development of new therapeutics for people with rare diseases, but have little or no regulatory acumen.

Previously, meetings at OOPD were informal and uniformly granted with nothing more than a phone call and a mark on the calendar. But things have changed: since 2007, orphan designation applications have increased 60%, ending at 300 per year; and, since 2011, they have increased further still, nearing 500 per year. Clearly, the system could no longer accommodate the historically breezy approach to sponsor meetings of the past. As expected, in spring 2014, OOPD issued a Federal Register announcement of its intent to formalise the meeting request process into written requests, briefing packets and a system more familiar to those meeting with FDA review divisions (1).

This growth in the workload of OOPD – and more specifically, the increasing proportion of all marketing applications that are orphan drugs – has prompted a re-examination of the US Prescription Drug User Fee Act (PDUFA) fee exemption that the sponsors of orphan products currently enjoy. The $2.2 million lost when a drug is an orphan product significantly impacts the FDA budget for review resources. There is a looming threat that the orphan drug exemption may return the Administration to the ‘bad old days’ of pre-PDUFA, when review times were measured in years, not months. Naturally, the orphan drug community has a strong interest in protecting the provisions of the current fee exemption, but at this time no other workable solution has yet been proposed.

Breakthrough Therapy Designation

The FDASIA 2012 Congress invented a new regulatory recognition for products that have not yet satisfied the requirements for marketing authorisation, but have early, clinical-stage evidence that show exceptional promise for delivering a valuable addition to the pharmaceutical directory. This saw the origins of breakthrough therapy designation (BTD), a sort of gold star award for products which meet such criteria. Congress required, and the FDA produced, a guideline to clarify the methods to apply for BTD and the headings by which such applications would be evaluated (2). In truth, the guidance was an attempt to apply Euclidian thought to what is essentially a subjective decision – it is a breakthrough when it appears to be a breakthrough.

Title Benefits

There are several values of receiving such a designation, and the benefits can be divided into formal and informal. The statute states that sponsors receiving such designation are to be entitled to higher level and interdisciplinary meetings, and all manner of expedited review, including the benefits of being fast-tracked. Essentially, BTD formally confers more FDA attention, and this is very valuable.

However, it is largely agreed that such benefits have historically been extended to products the FDA saw as breakthrough, albeit without any formal designation process. Again, the Administration was commissioned to institute this new programme of BTD review and awards, without any additional personnel or funding, and the growth of the programme has added administrative burden to a beleaguered FDA.

The informal benefits of BTD are more remarkable than the formal ones – currently, almost 50 applications have been awarded and the success rates for applications reach about 30%. Small companies that have had BTD awarded to their lead compounds have seen the values of their assets skyrocket. In sum, BTD has virtually no downside, and if a sponsor has a product in the clinic with preliminary positive data, there is little reason not to apply, and considerable reason to do so.

Priority Review Vouchers

In the FDASIA 2012 legislation, a new, creative, complicated and potentially very lucrative incentive was invented to help advance new therapies for paediatric rare diseases. The Paediatric Rare Disease Priority Review Voucher (PRDPRV) programme generates a saleable asset – essentially a voucher that would entitle a marketing application to priority review where previously it was not entitled to one. In brief, it is envisioned that small companies, after getting designated as eligible for a PRD-PRV, will be awarded the PRV when their products for paediatric rare diseases receive marketing approval. They can then sell this voucher, presumably to a large pharmaceutical company that is likely to want such a voucher for first-to-market advantage for a blockbuster drug.

Because first-to-market advantage is so valuable, and because the shortened review time captures significant value in sales, it was calculated by the pharma-economists who invented this programme – first seen seven years ago as an incentive for tropical/neglected diseases – that the voucher is valued at nearly $600 million (3). Furthermore, it was recently reported that Knight Therapeutics, which secured a PRV under the old programme, is now putting it up for sale, and is expected to generate up to $300 million from the transaction.

There are important criteria for designation for eligibility for the PRD-PRV: the product must be a new chemical entity not otherwise licensed by the FDA, it must have orphan status designation, and the product must primarily affect children under 18 years of age – currently, more than 50% of all prevalent US cases must occur in children to meet this latter criteria. Designation puts a sponsor in-line to actually receive the PRV at the time of market authorisation.

Test Case

The new PRD-PRV programme generated its first voucher in February 2014, awarded to BioMarin for its new drug for San Fillipo disease. The way the programme is legislated is as a test-case – two more PRD-PRVs will be issued, and development will begin with the issuance of the third. This process will run for one year, during which time designated products that receive marketing approval will also generate issuance of a PRD-PRV. Following this, no more PRD-PRVs will be issued until the US Government Accounting Office reviews the programme and its effectiveness at incentivising the development of new therapies for paediatric rare diseases.

Change is afoot at the FDA and this has important implications for the processes by which orphan drugs are developed. Sponsors that are engaged in such enterprises will do well to familiarise themselves with the new opportunities these changes make possible.


1. FDA OOPD, Draft guidance for industry, researchers, patient groups, and Food and Drug Administration staff meetings with the Office of Orphan Products Development, April 2014
2. FDA Center For Drug Evaluation and Research, Center for Biologics Evaluation and Research, Guidance for industry expedited programs for serious conditions – drugs and biologics, May 2014
3. Ridley D, Grabowski H and Moe J, Developing drugs for developing countries, Health Affairs 25(2): pp313-324, 2006

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Dr Timothy Coté is the Principal and Chief Executive Officer of Coté Orphan Consulting. Between 2007 and 2011, he served as Director at OOPD, granting more than 600 orphan designation applications and overseeing 50 products through to market approval. In addition, Timothy serves as the Professor of Regulatory Practice at the Keck Graduate Institute, where he teaches US and EU regulatory affairs.
Dr Timothy Coté
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