Federal officials call out FDA over lapses in rare-disease drug approval

The 1983 Orphan Drug Act motivated pharmaceutical companies to develop drugs for people who lacked treatments for their conditions.

The Food and Drug Administration has failed to ensure that drugs given prized rare-disease status meet the intent of a 35-year-old law, federal officials revealed in a report Friday.

The Government Accountability Office, which spent more than a year investigating the FDA's orphan drug program, said "challenges continue" in the program that was created to spur development of drugs for diseases afflicting fewer than 200,000 patients.
This investigation examines the booming orphan drug business and how drugmakers have rushed into the marketplace with hundreds of drugs for rare diseases, helping patients while landing lucrative federal incentives and monopoly control for every drug that gets approved.
    The investigation began after a request from three high-profile Republican senators last year, in the wake of a KHN investigation. KHN found that the program was being manipulated by drugmakers to maximize profits and to protect niche markets for medicines being taken by millions.
    The GAO uncovered inconsistent and often incomplete reviews early in the process of designating medicines as orphan drugs and recommended "executive action" to fix the system. In some cases, FDA reviewers failed to show they had checked how many patients could be treated by a drug being considered for orphan drug status; instead, they appeared to trust what drugmakers told them.
    In response to GAO's probe, the FDA issued a statement saying it agreed with the report recommendations regarding documentation and that the agency is "streamlining our processes." The agency declined requests for interviews. In a comment included with the report, Matthew Bassett, assistant secretary for legislation at the Department of Health and Human Services, said HHS agreed with GAO's recommendations.
    John Dicken, director of the GAO's health care team, said the focus of the report is "ensuring that the intent of the law is being met."
    The FDA's rare-disease program began after Congress overwhelmingly passed the 1983 Orphan Drug Act to motivate pharmaceutical companies to develop drugs for people who lacked treatments for their conditions. Rare diseases had been ignored by drugmakers because treatments for them weren't expected to be profitable. The law provides fee waivers, tax incentives for research and seven years of marketing exclusivity for any drug the FDA approves as an "orphan."
    The incentives, though, have proven to be more powerful and highly coveted than expected, said Avik Roy, president of the Foundation for Research on Equal Opportunity, a conservative think tank.
    Many people are "starting to wonder whether or not the Orphan Drug Act over-corrected for the problem," Roy said, noting that a third of all pharmaceutical spending in the U.S. will be on so-called rare-disease medicines in 2020.
    GAO analysts examined FDA records for 148 applications submitted by drugmakers for orphan drug approval in late 2017. FDA's reviewers are supposed to apply two specific criteria -- how many patients would be served and whether there is scientific evidence the drug will treat their disease.
    In nearly 60 percent of the cases, the FDA reviewers did not capture regulatory history information, including "adverse actions" from other regulatory agencies. The FDA uses experienced reviewers, Dicken noted, who may already know the history of certain submitted drugs and not see the need to document it.