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How to Rein in Skyrocketing Orphan Drug Costs

MHE PublicationVol 28 No 6
Volume 28
Issue 6



The International Rare Diseases Research Consortium hopes to develop 200 new drugs for rare diseases by 2020, and it seems as if things are better than on track. The FDA granted 77 orphan drug approvals last year and granted 476 orphan drug designation requests, according to law firm Hyman, Phelps & McNamara. Costs for these orphan drugs are skyrocketing.

As these drugs come to market, David Calabrese, RPh, MHP, Managed Healthcare Executive (MHE) editorial advisor and OptumRx’s senior vice president and chief pharmacy officer, discusses ways to stabilize economics, access, and appropriate use.

MHE: What can be done to balance economic efficiency with proper access and appropriate use?

Calabrese: I see four key areas that must be addressed. First, the evaluation of the clinical evidence and projected financial impact must be conducted in as robust and proactive a manner as possible. Ideally, pharmacy and therapeutics committees should be conducting these assessments prior to FDA approval to most effectively protect clients and their members from undo financial burden and safety risk. 

Secondly, utilization management programs must be designed in as comprehensive and academically rigorous a fashion as possible to limit usage to those patients most appropriate for such therapy.  

Third, once patients initiate therapy, close monitoring and care management support is essential to ensure maximal adherence, achievement of therapeutic goals, and that benefits obtained outweigh any unforeseen safety/tolerability issues. 

Finally, population-based analytics will be critical to assess both short- and long-term real-world outcomes for those receiving these therapies.  This will ensure clinical protocols and support mechanisms can be enhanced and refined to optimize clinical and financial benefits.

MHE: Which new drugs categories in the near-term pipeline will have the most significant impact on pharmacy cost trends over the next three to five years?

Calabrese: Newer options for the treatment and prevention of migraines and cluster headaches (CGRP antagonists) will be long-awaited additions to the options available for helping to manage migraine frequency and severity in this rather sizable patient cohort. As a result, uptake has the potential to be rapid and substantial. 

Several drugs are also in late-stage development for treatment of nonalcoholic steatohepatitis. This class is of key significance as there are no FDA-approved treatment options and an estimated 16 million U.S. adults with this condition.

There are numerous drugs, primarily biologic, that are in development for the treatment of Alzheimer’s disease. These include drugs in novel classes like the BACE inhibitors and RAGE antagonists. With the aging of the population, increased prevalence of disease, and limited array of effective treatment options, these drugs also hold the potential for significant market penetration should clinical data prove positive.

MHE: How can pharmacy benefit management best change to become more holistic and integrated in focus and function?

Calabrese:  This will require major industry transformation encompassing, but not be limited to:

  • Enhanced data integration (medical, pharmacy, lab, EHR, behavioral health, and social determinants of health);
  • Advanced analytic support including real-world evidence assessment, predictive analytics, and machine learning; 
  • Progressive, consumer-focused digital resources and engagement vehicles;
  • Point-of-service provider engagement tools fully-integrated into daily work flow;
  • Newer formulary and utilization management models that de-emphasize rebates and promote greatest value;
  • Reformed business models that deliver optimal transparency in all clinical, operational, and financial offerings; and
  • Greater alignment with target clinical and financial goals between PBMs and clients. 

Tracey Walker is Content Manager for Managed Healthcare Executive.


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