For the roughly 30 million Americans living with a rare disease, the chances of finding an effective treatment are tragically slim. Adding insult to illness, an element of 2022’s Inflation Reduction Act (IRA) discourages research into treatments for rare conditions.
The good news is that Congress can undo this unintended consequence by passing the ORPHAN Cures Act, bipartisan legislation introduced in the House and the Senate. The legislation would remove an unnecessary barrier to medical progress.
Developing medicines that treat rare diseases—or “orphan drugs,” as they’re sometimes known—is an extraordinarily difficult task, in part, because investors are generally unwilling to spend billions of dollars developing a product that benefits so few patients. Right now, just 5% of rare diseases have an FDA-approved treatment.
Unfortunately, the IRA, as written, does the opposite.
In order to reduce Medicare’s costs, the IRA allows the government to demand price controls on a range of prescription drugs paid for through the program. So as not to stand in the way of orphan drug development, lawmakers attempted to exclude these medicines from the price-setting program—but with one important exception. The rare-disease carve-out doesn’t extend to treatments approved for more than one rare disease.
In other words, an orphan drug approved to treat one disease is exempt from Medicare price cuts. But if a scientist discovers a second rare disease application for the same drug, they face a steep financial penalty through loss of the exemption.
Of the more than 280 orphan drugs approved since 2003, nearly a quarter were later approved to treat additional diseases. Some medicines earned approval for four or more follow-on indications. These are potentially life-saving discoveries that may not have occurred under the pricing system created by the IRA.
Lawmakers can fix this problem right now simply by passing the ORPHAN Cures Act. The two-page bill amends the IRA’s drug-pricing section by changing the words “only one rare disease” to “one or more rare diseases.”
With that revision, the legislation vastly increases the odds of treating and curing many of the thousands of rare diseases that currently lack effective medications.
Dr. Ted W. Love is chair of the Biotechnology Innovation Organization’s board of directors.
