Today’s House Committee on Energy and Commerce hearing, “Legislative Proposals to Support Patients with Rare Diseases,” is perfectly timed with Rare Disease Day, which marks the end of Rare Disease Week. Every year, on the last week of February, patients and their advocates take to Capitol Hill to meet with lawmakers to advocate for more research and development into new, potentially life-saving treatments for the more than 30 million Americans living with a rare disease. Rare diseases – those impacting less than 200,000 patients – are under-researched, under-diagnosed, and under-treated.
The Committee will discuss more than a dozen solutions to support patients living with rare diseases, including the Better Empowerment Now to Enhance Framework and Improve Treatments (BENEFIT) Act, which would modify the new drug approval process by requiring the Food and Drug Administration (FDA) to utilize relevant patient-experience data as part of the benefit-risk assessment framework, and the Optimizing Research Progress Hope And New (ORPHAN) Cures Act. This legislation would make changes to the Inflation Reduction Act (IRA), preserving the orphan drug status of medications that treat one or more rare diseases and exempting them from the IRA’s Medicare drug price negotiation program.
When Congress passed the IRA, and President Biden signed it into law in 2023, intentionally or not, the law’s design keeps new treatments for rare diseases from entering the market.
Orphan drugs are those used to treat, prevent, or diagnose a disease that affects fewer than 200,000 people. Due to the small patient population treated by orphan drugs, Congress created incentives in 1983 through the very successful Orphan Drug Act, which provides drugmakers with grants to fund new research and development, tax credits for human trials, waiving FDA user fees, and up to seven years of market exclusivity.
After any product is approved, drug makers continue researching to determine if the product has other health benefits for other orphan indications and conditions. Studying repurposed products can lead to faster access and potentially less expensive therapies. Successful repurposing can be found in the oncology space, where more than 60 percent of products on the market received FDA approval as a result of follow-up research.
Under the IRA, however, only orphan drugs granted a single orphan designation by the FDA would be excluded from the Medicare Drug Price Negotiation Program. As soon as a product is granted a second orphan designation, the drug loses exemption status and would be eligible for price negotiation, which clearly disincentivizes manufacturers from studying additional orphan indications for their products.
In its final IRA program rule (not a regulation – Congress allows the Centers for Medicare & Medicaid Services (CMS) to skirt the rule-making process), CMS said it would consider a drug that has been given an orphan designation from the FDA for more than one rare disease or condition as qualifying grounds for price negotiation. To be clear, receiving an orphan designation is not the same as receiving FDA approval. An orphan designation means that a product has met the required qualification to receive the incentives the Orphan Drug Act provides, should the product receive FDA approval. Simply testing an already approved orphan drug to treat another disease would make it subject to price negotiations, even without FDA approval for additional indications. A number of orphan drugs have multiple indications for the same therapy, which now makes them ineligible for the IRA exclusion and puts them at risk for price negotiation. If this is all an effort to limit costs, it is hard to see how limiting the development of cures and treatments that keep people out of hospitals will help achieve cost savings.
The impact of the IRA’s orphan drug policy has been immediate, with several companies redirecting research programs to other diseases and conditions to escape the IRA’s price control scheme. Because medicine and scientific knowledge are constantly changing, the last thing we need is to create disincentives for further acquisition of knowledge necessary to treat patients without hope.
For too long, the needs of rare disease patients have been ignored. However, today’s Energy and Commerce hearing is a small step in including their voices in the legislative process. Lawmakers should use today’s momentum to create real change by amending the IRA so that it promotes scientific research needed to provide treatments to the patients who deserve them, pursuing a more patient-friendly environment for constituents who cannot afford to see innovation delayed or derailed, and keeping their promises to the rare disease patients who visited Capitol Hill this week.