Will the orphan privileges within the AMNOG procedure soon be history?

The sound justification for this special position for orphan drugs in the benefit assessment is based on the provision of an economic incentive for pharmaceutical companies to push ahead the development of drugs for rare diseases despite the economic risks, as often only inadequate therapy options have been available in this area to date. However, these privileges cease to apply if the sales of a drug exceed EUR 50 million within 12 months, leading to a re-evaluation of the additional benefit on the basis of a comparison with a defined appropriate comparator therapy. This procedure and the special rules for the evaluation of orphan drugs have been subject to intensified public discussion since the beginning of the year.

Background: The Institute for Quality and Efficiency in Health Care (IQWiG) published the working paper "Evidence on Orphan Drugs" on January 12th, 2022. In total, 41 orphan drug evaluations have been analyzed by IQWiG for this purpose, for which both a specific orphan evaluation and a subsequent benefit assessment were performed by IQWiG. Based on the underlying procedures and the benefit assessments, IQWiG found that the previously granted additional benefit under orphan conditions was not confirmed in a full procedure in approximately 50% of cases, with little consideration given to procedure- or assessment-specific circumstances in most cases. As a conclusion of the report, IQWiG sees a current mismanagement in the evaluation of orphan drugs and that the additional benefit granted according to the legal basis is not justified and should be abolished accordingly.

Following the publication of the IQWiG study, Prof. Josef Hecken, impartial chairman of the German Federal Joint Committee (G-BA), has taken position on the issue of orphan drugs in an interview with the Tagesspiegel. Prof. Hecken also sees a need for revision in the procedures, but in contrast to the fundamental criticism of IQWiG, he pleads for a clearer differentiation and the maintenance of the special position for orphan drugs, which could be modified according to the following suggestions:

• Prof. Hecken demands: "Only the very first new drug for a specific rare disease can still enjoy orphan privilege in the assessment of additional benefit." All subsequent therapeutic agents should undergo a full procedure and a benefit assessment in comparison to an appropriate comparative therapy, since a comparable treatment alternative is already available on the market.
• The currently existing limit for a regular benefit assessment, which marks a minimum turnover of 50 million euros, is to be reduced to 25 million euros. In this way, Prof. Hecken wants to increase the commitment of pharmaceutical companies to good orphan drug studies.
• The pricing of single-use therapies, especially gene therapies, should be adjusted. Prof. Hecken is clearly in favor of the pay-for-performance approach in this context, especially in cases where gene therapies cannot deliver on their curative promise. In this regard, he cites as an example the gene therapy Zolgensma®, where, after an observation phase, clinical reality provides for a combined therapy with Spinraza® (nusinersen) starting about one year after the administration of Zolgensma®, thus causing significant additional costs due to the combination therapy. Here, Prof. Hecken concludes that if a single-agent therapy does not fulfill its promise in clinical practice, the costs of a combination therapy would also have to be reflected in the pricing.

The orphan privilege offensive and the abolition of the legally granted additional benefit are currently the subject of intense debate. In light of the coalition agreement of the new German government, a revision of the current AMNOG procedure is already a decided matter. To what extent the current discussion will lead to a tightening of the evaluation of orphan drugs remains to be seen. As a strategic partner in the market access of orphan drugs, SKC consulting follows, analyzes and anticipates the political developments and incorporates them directly into the consulting of its clients.

Sources:

• IQWiG: Orphan Drugs: Privileg des „fiktiven" Zusatznutzens nicht gerechtfertigt
• IQWiG: Evidenz zu Orphan Drugs
• Tagesspiegel: „Pay-for-Performance ist die Zukunft"