Dr Dyfrig Hughes

8/4/2019 Dr Dyfrig Hughes

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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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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




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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




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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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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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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



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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



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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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Dr Dyfrig Hughes