Orphan Drugs: Pursuing Value And Avoiding Unintended Effects Of Regulations

Amid ongoing scrutiny of high pharmaceutical drug prices, debate about the value of “orphan drugs”—those designed to treat rare conditions that affect fewer than 200,000 individuals—continues to capture public and policy maker attention. The latest examples involve Emflaza and Spinraza, drugs used to treat the rare genetic childhood disorders of Duchenne muscular dystrophy and spinal muscular atrophy, respectively. Both have been approved by the Food and Drug Administration (FDA) and provide meaningful efficacy and value to patients affected by these conditions. However, outcry has developed in response to extremely high list prices: Emflaza has been priced at $89,000 per year, while Spinraza has a list price of $750,000 for the first year of an infant’s treatment and $350,000 per year thereafter. Policy makers have expressed concern about the effect of this dynamic on patients and the public. Extremely high prices could prompt payers to severely restrict or deny coverage for some of the patients who would benefit. Additionally, insurers that choose to cover these medications are likely to distribute added costs across other individuals who do not need them, increasing costs but not value—at least in the short run—for this unaffected population. High Prices As An Unintended Effect Of Government Regulation It is worth noting that such aggressive price setting arises in part from an unintended effect of government regulation of orphan drugs. Since ...
Source: Health Affairs Blog - Category: Health Management Authors: Tags: Costs and Spending Drugs and Medical Innovation Insurance and Coverage Quality Duchenne Muscular Dystrophy government regulation Orphan Drug Act orphan drugs value-based pricing Source Type: blogs