In 1982 the Food and Drug Administration (FDA) created the Office of Orphan Product Development to incentivize pharmaceutical companies to develop treatments for rare or 'orphan' diseases. The program has led to the successful development and marketing of more than 400 drugs and biologic products for rare diseases since 1983.
The Orphan Drug Designation Program provides orphan status to experimental drugs and biologics that are intended to safely and effectively treat, diagnose or prevent rare diseases. Rare or orphan diseases are defined as those that affect fewer than 200,000 people in the U.S., or that affect more than 200,000 people but which are unlikely to enable pharmaceutical companies to recover the costs of developing and marketing drugs to treat them.
Orphan Drug Designation qualifies the company sponsoring the drug for various development incentives, such as tax reductions and credits for qualified clinical testing, filing fee waivers, and the exclusive rights to the treatment for the specific rare disease for a period of seven years post-approval.
These incentives encourage companies to enter a market where the high costs of drug development are less likely to be recouped quickly due to the smaller pool of individuals needing the treatment and the expenses associated with developing and marketing treatments for rare diseases.
Designation as an Orphan Drug does not alter the standard FDA regulatory requirements for drug safety and efficacy that must be established through adequate and well-controlled clinical studies, nor does it mean that the drug is safe and effective or legal to manufacture and market in the United States. It means that the company developing the drug has qualified for certain incentives from the federal government.
For more information on clinical trials, visit the MDF Study & Trial Resource Center.