Economic evaluation of orphan drugs
Evidence derived from economic evaluations is used to inform pharmaceutical reimbursement (and/or pricing) decisions in many countries. The economic evaluation of orphan drugs is inhibited by the existence of often limited and weak clinical data at launch time. In the context of rare diseases, it may prove difficult to recruit a sufficient number of patients and medical centers in clinical trials, thus raising costs. Orphan drug trials (in for example the field of oncology) may be halted early on ethical grounds when an interim analysis demonstrates clinical superiority of the orphan drug in terms of an intermediate outcome measure such as progression-free survival. It has been recommended to allow greater use of surrogate outcome measures for orphan drugs if clinical data are incomplete, but impose at the same time a commitment to continue research [
22].
A central component of this approach is the commitment to ongoing evaluation through, for example, patient registries of rare diseases designed to collect the necessary data to follow up and evaluate uncertainties surrounding the longer-term effectiveness and cost-effectiveness of orphan drugs used in the treatment of rare diseases [
23]. Setting up patient and disease registries is part of EU policy and is an action line in rare disease plans that many member states have in place or are setting up. The use of patient registries would support the decision-making process, inform clinical practice, and could provide information about long-term adverse events.
However, patient registries of rare diseases have their limitations. A patient registry may be biased if the patient etiology and disease severity change over time. Also, patient registries tend to collect data on a specific orphan drug used in the treatment of a rare disease, but not on alternative treatments, thus providing partial information to calculate the cost-effectiveness of the orphan drug relative to an alternative treatment. Furthermore, new treatment strategies may become available during the period covered by the registry. Therefore, patient registries of rare diseases need to be set up in a flexible way to collect sufficient data and to account for the evolution in patient population and treatment strategies over their lifecycle.
Societal considerations
Given their high price for an often modest effectiveness, orphan drugs are unlikely to provide value if their cost-effectiveness ratio is compared to a fixed threshold value (e.g. the threshold of £20,000-£30,000 per QALY used by NICE in England and Wales [
24]) [
14]. This raises the question of whether society needs to provide incentives to pharmaceutical industry to develop orphan drugs when the costs surpass the value that society attaches to the health benefits produced by orphan drugs [
25]? In order to answer this question, it has been argued that other societal considerations may matter when evaluating an orphan drug, such as the observation that orphan drug reimbursement conforms to the principle of social solidarity in which vulnerable groups receive support; that orphan drugs tend to target life-threatening diseases for which there may be no alternative therapy; and that orphan drugs have a considerable impact on patients' health care expenditures if they would have to incur the drug costs themselves. For instance, the Pharmaceutical Benefits Advisory Committee in Australia is reported to take into account such societal considerations [
26].
How can these various considerations be aggregated? In other words, how can the often high cost-effectiveness ratio, weak clinical data, small health benefit, high cost and absence of an alternative therapy for orphan drugs be taken into account in a payer's decision to cover such a drug? It has been argued that the threshold ICER should be higher for drugs to which society attaches a high social value [
14]. Alternatively, equity weights could be applied to outcome measures according to disease prevalence [
27]. Methodological guidance issued by NICE in January 2009 stated that weights should consider the uncertainty surrounding the evidence of the drug's clinical effectiveness and the value that patients place on additional months of life [
28]. Weighted outcomes would increase the health gain achieved by an orphan drug, so that there is a higher probability that an orphan drug has an ICER below the threshold value. However, to the best of the author's knowledge, this approach has not been applied in practice yet.
Orphan drugs may attract a high social value, although more research is needed to elicit social values ascribed to orphan drugs and to rare diseases [
25]. A literature review has indicated that society attaches a higher value to health improvements experienced by patients who have worse lifetime health prospects [
29]. In 2005, NICE in England and Wales set up a Citizen's Council with a view to identifying criteria that the National Health Service may use to value orphan drugs more highly [
30]. The top three criteria were the degree of severity of the disease, whether treatment achieved more than just stabilize the disease, and whether the disease was life-threatening. Eighty percent of the Council indicated that disease severity might be a reason to pay a premium for drugs, but disease rarity was not. A Norwegian study explored whether a societal preference existed for giving priority to the treatment of rare diseases and for accepting a higher threshold ICER for orphan drugs [
31]. Although respondents supported equal treatment rights for patients with rare diseases, no societal preference for rarity existed if treatment of rare diseases implied that patients with common diseases could not be treated in the context of a finite budget.
The relevance of societal considerations can be illustrated with several orphan drug decisions made by the Medicine Reimbursement Committee in Belgium and NICE in England and Wales. A Belgian study reviewed reimbursement dossiers of 26 orphan drugs submitted between January 2002 and June 2008 [
4]. Reimbursement was awarded to 22 orphan drugs. The Medicine Reimbursement Committee advised to reimburse 19 drugs and reimbursement was approved by the Minister of Social Affairs. Although the Committee did not issue an advice relating to one drug, reimbursement was approved by the Minster of Social Affairs. For the remaining two orphan drugs, the dossiers indicated that both the Medicine Reimbursement Committee and the manufacturer proposed a number of elements for negotiation - including a price decrease, employment opportunities, restrictions on the size of the patient population, the funding of diagnostic tests by the company, a reduction of the dosage - which may have played a role in awarding reimbursement. The rationale for not granting reimbursement to four orphan drugs may be related to the high cost of these drugs in comparison with alternative drugs or the existence of other non-orphan indications of the drug.
Despite an unfavorable cost-effectiveness ratio, NICE approved imatinib for the treatment of chronic myeloid leukaemia with an ICER of £37,000 per QALY in the chronic phase, £38,400 per QALY in the accelerated phase and £49,000 per QALY in the blast phase in the absence of any effective alternative therapy (except for bone marrow transplantation) and on equity grounds [
32]. A second example relates to enzyme replacement therapy for Fabry's disease. An economic evaluation stated that, although the ICER of enzyme replacement therapy is at least six times higher than the threshold value adopted by NICE, clinicians and manufacturers argued that the National Health Service had no option but to provide this therapy because Fabry's disease is a rare disease [
33].
Innovative mechanisms have been proposed for the reimbursement of orphan drugs. Risk-sharing arrangements are schemes in which the manufacturer shares the risk with the health care payer that the product may not be effective for a particular patient. If the product does not have the expected effect, the company may loose some or all product revenue, or needs to provide a replacement product [
34]. Such arrangements are instituted at the level of a defined patient population, may require physicians to be trained in the appropriate use of the drug, and necessitate the implementation of a tracking system to follow up its use. For instance, the Scottish Medicines Consortium has in place an Orphan Medicines Risk Share scheme [
35]. Medicines included in the risk share scheme are agalsidase alpha and beta for Fabry's disease; imiglucerase and miglustat for type 1 Gaucher's disease; and iloprost for pulmonary arterial hypertension. In England and Wales, NICE has instituted a risk-sharing scheme for the supply of interferon beta and glatiramer acetate which incorporated agreed target treatment effects for patients with multiple sclerosis [
36]. If treatment effects were not achieved, the scheme included the option to reduce the drug price to guarantee its cost-effectiveness at a threshold value of £36,000 per QALY. However, some concerns with this scheme have recently been identified [
37] and some have argued that the money should be better allocated to funding a randomized controlled trial of interferon beta [
27].