Frank Diamond

They are relatively cheap to develop, since clinical trials are small and “the lack of alternative treatments give orphan agents an advantage when up for regulatory review,” according to a report by Evaluate, a life science market intelligence company that provides forecasts on that sector. The company’s second annual EvaluatePharma Orphan Drug Report says that orphan drug sales will make up 19% of prescription drug sales by 2020, totaling about $176 billion.

Insurers will have their hands full because even though the populations that need orphan drugs are small “they represent big per-patient outlays, and insurers will be looking carefully at new tools to arrest cost growth as more and more orphan drugs launch,” says the study. The cost per orphan drug per patient is six times that of non-orphan drugs.

Worldwide Orphan Drug Sales & Share of Prescription Drug Market (2000-20)

Average Cost per Patient per Year 2010-14

Source: “EvaluatePharma Orphan Drug Report 2014,” Evaluate