New Report Finds Medical Treatments for Rare Diseases Account for Only 11% of US Drug Spending; Nearly 80% of Orphan Products Treat Rare Diseases Exclusively

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Washington, DC, March 4, 2021—As US policymakers consider options to address rising health care costs while still meeting the needs of patients, a new report from IQVIA has found that rare diseases account for just 11% of medical invoice spending in the United States, and 79% of all orphan products treat only rare diseases. The report also highlights recent progress in drug development that has resulted in more people with rare diseases having access to critical treatments. 

As of January 1, 2020, 564 orphan products were approved by the US Food and Drug Administration (FDA) to treat 838 rare diseases (or “indications”). Thirty percent of all orphan indications were approved in the three years prior to the study, which is based on 2019 data. Multiple uses for the same medicine have become increasingly common, particularly in cancer and autoimmune diseases, as improved understanding of biological pathways allows for a single therapy to treat numerous rare and common conditions. Still, most orphan products treat only one rare disease. 

The report also demonstrates that patients are gaining access to multiple treatment options due to generics and biosimilars entering the market, in many cases, even when there is a term of orphan drug exclusivity in effect. 

“Drug pricing is an issue that affects every American. Our hope is for this data to raise awareness of the critical need for new rare disease treatments, and demonstrate that the overall amount spent on those treatments is small compared to the total drug spend in the United States,” said Peter L. Saltonstall, President and CEO of the National Organization for Rare Disorders (NORD®). “People with rare diseases need help, and the Orphan Drug Act is important for spurring innovation.” 

Since 2010, the share of orphan drug spending has increased by five percentage points, likely due to the increasing number of approved orphan products. During this same time, specialty drug spending has also risen by 22 percentage points and now accounts for 47% of all medical invoice spending. However, specialty drugs and orphan drugs are not the same, and IQVIA found 77% of specialty drug spending is for the treatment of common conditions and not rare diseases. 

Approximately 7,000 known rare diseases affect more than 25 million Americans. Rare diseases tend to be chronic, serious and life-threatening. Approximately 80% of rare diseases are genetic in origin. More than 90% of rare diseases have no treatment. 

The report, “Orphan Drugs in the United States: Rare Disease Innovation and Cost Trends Through 2019,” is available at NORD commissions the study every two years to examine the state of drug development for rare diseases as part of its mission to support people with rare diseases.