NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Orphan Drugs Cure Rare Diseases

"One additional orphan drug approval is estimated to have prevented 211 deaths in the subsequent year."

In the past two decades, a surge of new drugs aimed at treating rare (or "orphan") diseases has increased the life expectancy of the average American by about two and a quarter months, according to NBER Research Associate Frank Lichtenberg. In The Effect of New Drugs on Mortality from Rare Diseases and HIV (NBER Working Paper No. 8677) he notes that, before Congress passed the Orphan Drug Act in January 1983, very few new drugs designed to treat rare diseases -- diseases affecting fewer than 200,000 Americans -- came to market. The average annual number of drugs for rare diseases brought to market after the Act was passed (during 1983-99) was 12 times as great as it had been during 1973-82.

The Orphan Drug Act and its subsequent amendments were meant to encourage the development of drugs that otherwise might be uneconomic by guaranteeing the developer of such products seven years of market exclusivity following their approval by the Food and Drug Administration. The Act also provided a tax credit, and established a clinical research grants program whereby researchers could compete for funding to conduct clinical trials that might support the approval of these drugs for rare diseases.

Lichtenberg's study indicates that these new drugs did reduce mortality rates from rare diseases. Prior to the Act, mortality from rare disease grew at the same rate as mortality from other more common diseases. In the five years after the Act, mortality from these rare diseases -- such as Huntington's disease, myoclonus, ALS, Tourette's syndrome, and muscular dystrophy -- grew more slowly than mortality from other diseases. One additional orphan drug approval is estimated to have prevented 211 deaths in the subsequent year, and ultimately prevented 499 deaths from rare diseases. The 216 orphan drugs approved since 1983 thus are estimated to ultimately prevent 108,000 deaths from rare diseases. Deaths from rare diseases occur about five years earlier than deaths from common diseases.

Lichtenberg batches all the orphan drugs together in reaching his conclusions because the data does not allow for separating out the impact of each individual drug on the sufferers from a specific disease. Nor does it indicate whether a specific drug actually cures a disease or just prolongs the life of a victim.

In a similar vein, the average annual number of drugs brought to market to treat Human Immunodeficiency Virus (HIV) during 1994-8 was three times as great as during 1987-93. In the case of HIV, the increase in drugs occurred after AIDS (first reported in 1981) was identified as being caused by HIV in 1984. In the 1990s, the average length of time required to develop a drug that was approved was about 15 years. These new drugs played a key role in the post-1995 decline in HIV mortality, Lichtenberg's evidence indicates.

Each additional HIV drug approval is estimated to prevent 5,986 deaths in the year subsequent to that approval and ultimately 33,819 deaths in total. The average life span of an individual infected with HIV has been about 40 years; that compares with an average life expectancy for Americans of about 73 years. Lichtenberg's work indicates that the life expectancy of HIV victims has been prolonged by the drugs, but it is too early to indicate by how many years.

-- David R. Francis

 
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