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Re-Thinking Rare Disease

 
• By Melanie Senior

Germany is drastically squeezing orphan drug pricing while new US laws protect rare diseases drugs from price negotiations. These contrasting moves fuel the longstanding debate over whether orphans still deserve special incentives.  

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Orphan drugs are classified as those destined for fewer than five in 10,000 people in Europe • Source: Shutterstock

In the last days of July 2022, Germany’s cabinet passed a swathe of drug pricing measures designed to curb pharmaceutical spending and help plug a €17bn healthcare funding gap in 2023. (Also see "Germany: Leaked Pricing Measures Could Have ‘Drastic’ Consequences For Orphans" - Pink Sheet, 7 July, 2022.) Weeks later, US Congress passed a law allowing Medicare to negotiate the prices of some drugs, potentially saving $100 billion over a decade. (Also see "Medicare Price ‘Negotiation’ Process Gets Broad Brush Treatment In New Law" - Scrip, 16 August, 2022.) But while Germany’s new laws include a drastic squeeze on how orphan drugs are assessed and priced, the US law protects the category – and may even provoke higher launch prices.

Payers everywhere are concerned over the growing collective cost of rare diseases drugs. They account for over half of FDA approvals and 40% of the global pipeline, yet ultimately serve...

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