Senate Holds Hearing on Rare and Neglected Pediatric Diseases
|Written by Gene Quinn
Patent Attorney & Founder of IPWatchdog
Zies, Widerman & Malek
Follow Gene on Twitter @IPWatchdog
Posted: Jul 22, 2010 @ 12:49 pm
It is becoming popular in some circles to beat up on companies that employ people, make a profit and actually have the audacity to patent their innovations. In this bizarro world the logic, what little of it seems to prevail, suggests that no incentives are necessary in order innovation because innovation will just happen naturally. This naive view of the world ignores the human condition, among many other things. An appropriate incentive structure promotes innovation and benefits society. Even the most irrational and illogical critic has to agree that not all incentives to innovate are evil. Exhibit 1 – the Orphan Drug Act of 1983.
Yesterday, John F. Crowley, CEO of Amicus Therapeutics (Nasdaq: FOLD) and a member of the Board of Directors of the Biotechnology Industry Organization (BIO), testified on behalf of BIO at the Senate Committee on Health, Education, Labor and Pensions. This full committee hearing focused on rare and neglected disease. Mr. Crowley, provided background and perspectives on the current state of drug development for orphan products, and made a series of recommendations to the Committee regarding the establishment of additional incentives for companies to develop more treatments for rare and neglected diseases.
Before diving into Crowley’s testimony, let’s discuss the Orphan Drug Act. At the time of the enactment of the Orphan Drug Act the United States Congress made several factual findings. For example, the Congress observed that there are many diseases and conditions, such as Huntington’s disease, ALS (Lou Gehrig’s disease), Tourette syndrome, and muscular dystrophy, for example, which affect such small numbers of individuals that the diseases and conditions are considered rare in the United States. As a result, adequate drugs have not been developed and realistically cannot be expected to be developed because companies who could produce the necessary drugs may reasonably expect the drug to generate relatively small sales in comparison to the cost of developing the drug, thereby incurring a financial loss for the pursuit of such drugs. Therefore, Congress made the determination that a seven (7) year period of exclusivity was appropriate if a company produced a drug to treat a rare disease that affects less than 200,000 people in the United States. Orphan designation is also possible if a disease affects more than 200,000 people if it can also be shown that there is no reasonable expectation that the cost of developing the drug could be recouped absent this period of exclusivity.
During his testimony, Mr. Crowley discussed the unprecedented success of the Orphan Drug Act and its market-based incentives for biotechnology and pharmaceutical companies to develop products for rare diseases. Indeed, the Food and Drug Administration describes the Orphan Drug Act as an overwhelming success, pointing out on it’s website that “more than 200 drugs and biological products for rare diseases have been brought to market since 1983. In contrast, the decade prior to 1983 saw fewer than ten such products come to market.” This information is, however, quite dated. If you visit the FDA website to search for orphan drug designations and approvals you find out that as of July 22, 2010, there have been 351 drugs approved for use as orphan drugs and some 2,196 applications submitted. So in the decade prior to enactment there was on average 1 new drug to treat rare disease each year. Since enactment there has been 13 such drugs per year.
Those who are opposed to exclusive rights because it prevents innovation and provides no benefit to the public really should do their homework. They run about throwing this study from an agenda driven economist or that study from a disgruntled economist as if these fictitious mental exercises that ignore reality are evidence of some kind. At the same time they ridicule and pick apart the Studies that reach a contrary conclusion, and simply ignore facts. In this space we really don’t need to be doing any Studies. We just need to observe history. Wherever countries have gone from no intellectual property system to having an intellectual property system an economy has developed and foreign investment floods in. Time and time again this happens and it is irrefutable. In the same vein, the numbers simply do not lie. Granting exclusive rights has resulted in 13 times the number of drugs to treat rare disease.
During his testimony on Capitol Hill, Crowley made several recommendations on new policies for the Committee’s consideration to accelerate the development of treatments for rare and neglected diseases that will complement and advance the objectives of the Orphan Drug Act and facilitate the availability of the next generation of orphan products for children. These recommendations included:
- Improving the U.S. Food and Drug Administration (FDA) regulatory environment for pediatric rare diseases;
- Establishing a separate Division of Genetic and Metabolic Disorders at FDA;
- Urging FDA to publish further guidance regarding increased use of surrogate endpoints for product approval, either for full approval or accelerated approval purposes;
- Improving standards for demonstrating safety and efficacy of rare disease products;
- Improving communications processes for rare disease stakeholders;
- Extending the Qualifying Therapeutic Discovery Project Tax Credit; and
- Fully funding the Cures Acceleration Network (CAN).
John F. Crowley commented in his testimony, “We have come very far in the last quarter of a century but we have much further to go. The change brought about by the Orphan Drug Act improved millions of lives in this country and abroad, helped launch an industry and established the global rare disease advocacy movement. It does not come easily for every family that struggles with illnesses and then receives a life-altering diagnosis of a rare disease with no treatment or cure. However, each of us committed to orphan drug development, including the FDA and those responsible for seeing the Agency is appropriately funded, owe those families a more-than-fighting chance that their medical needs will be met.”
“Through his compelling personal story and his professional passion, John Crowley truly understands the importance of the Orphan Drug Act and the need for additional incentives to spur the development of breakthrough treatments for rare and orphan diseases,” said BIO President and CEO Jim Greenwood. “The recommendations John made in his testimony today reflect the concerns and interests of our member companies who are actively researching the next generation of therapies and the patients and their families who so desperately need them.”
So the next time you hear someone criticize the patent system or exclusive rights as unnecessary, evil, immoral or anti-innovation you can chuckle at the ignorance and arrogance. You might also want to cite the Orphan Drug Act and the way that for-profit companies in the biotechnology and pharmaceutical sector are helping people live longer and more productive lives without the pain and suffering they would otherwise endure. Then you can politely point to the facts that since the Orphan Drug Act treatments for diseases that would have otherwise gone ignored have grown by 1300%, and then suggest we need more not less exclusive rights. Then step back and watch the dodging and weaving that will surely accompany the apoplectic fit you are about to witness.
Who says this stuff isn’t fun?
About the Author
Gene Quinn is a US Patent Attorney, law professor and the founder of IPWatchdog.com. He is also a principal lecturer in the top patent bar review course in the nation, which helps aspiring patent attorneys and patent agents prepare themselves to pass the patent bar exam. Gene started the widely popular intellectual property website IPWatchdog.com in 1999, and since that time the site has had many millions of unique visitors. Gene has been quoted in the Wall Street Journal, the New York Times, the LA Times, USA Today, CNN Money, NPR and various other newspapers and magazines worldwide. He represents individuals, small businesses and start-up corporations. As an electrical engineer with a computer engineering focus his specialty is electronic and computer devices, Internet applications, software and business methods.