Why develop or invest in rare orphan disease treatments? The better question is: Why not?

“Rare” or “orphan” diseases aren’t so rare anymore. Today, there are about 300 million people worldwide, including one in 10 Americans, living with one of 7,000 rare diseases, according to the National Institutes of Health (NIH).

Many of these diseases are without any effective, approved treatment and while drug development can be both expensive and time-consuming, the FDA’s support for developing new therapeutics and bolstering regulatory approval can mean a faster pathway to market. Interestingly, global orphan drug sales are forecast to grow at double the rate of non-orphan drugs, with sales anticipated to reach $262 billion – capturing one-fifth of worldwide sales by 2024 – according to EvaluatePharma’s Orphan Drug Report.

From rare to well-done

With the trifecta of premium prices, tax breaks and reduced marketing costs, the Orphan Drug Act of 1983 was designed to incentivize companies to pursue the orphan drug market and it worked: The FDA has approved close to 800 new orphan drugs since it took effect, with the lion’s share taking place post-2013. The Act was so successful that it prompted similar laws in the European Union and Japan.

These new therapies are helping those with rare diseases while continuing to climb in value. The global rare orphan disease market is expected to enjoy a compounded annual growth rate greater than 11 percent between 2018 and 2024, based on EvaluatePharma research.

Meanwhile, expanded patient advocacy, medical advances, venture capital interest and industry partnerships are combining to highlight the global importance of rare orphan disease treatments.

Changing the world of rare disease

Companies that develop rare orphan disease treatments and individuals and organizations that invest in them are not only doing good for those in need: They enjoy less competition, since many larger companies are reluctant to pursue treatments for a smaller audience, not to mention a full seven years of patent protection for investing in research and development—two years longer than the exclusivity timeframe for other drugs. Finally, approval times are often swifter for drugs that have orphan drug status.

Notably, a company’s stock price increases by nearly 3.4 percent in correlation with an orphan drug designation announcement, according to the Journal of Rare Diseases.

Further, the unmet need is astronomical: There are only treatments for about 5 percent of rare diseases, according to Global Genes, however, there are more than 560 drugs in development for rare diseases, based on a PhRMA report.

While these drugs are often expensive, they are also life-changing and life-saving. The opportunity to develop or invest in orphan drugs can be invaluable for companies and investors alike.


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Why develop or invest in rare orphan disease treatments? The better question is: Why not?

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