RARE Daily

Rare Diseases Account for 11 percent of U.S. Drug Spending, Report Finds

March 5, 2021

Rare Daily Staff

Rare diseases account for 11 percent of medical invoice spending in the United States, according to a new report, commissioned by the National Organization for Rare Disorders, from IQVIA.

The study also found that 79 percent of all orphan products treat only rare diseases.

The report comes amidst the ongoing debate of the cost of prescription medicines and policymakers’ interest in finding ways to address costs.

As of January 1, 2020, the U.S. Food and Drug Administration approved 564 orphan products to treat 838 orphan indications. Some 30 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. Nevertheless, the report found that most orphan products treat only one rare disease.

“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 Saltonstall, president and CEO of the 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 percent of all medical invoice spending.

Specialty drugs and orphan drugs are not the same. IQVIA found 77 percent 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 percent of rare diseases are genetic in origin. More than 90 percent 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 rarediseases.org/rareinsights. 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.

Photo: Peter Saltonstall, president and CEO of the NORD

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