COMMISSION STAFF WORKING DOCUMENT EVALUATION Joint evaluation of Regulation (EC) No 1901/2006 of the European Parliament and of the Council of 12 December 2006 on medicinal products for paediatric use and Regulation (EC) No 141/2000 of the European Parliament and of the Council of 16 December 1999 on orphan medicinal products - Hoofdinhoud

Council of the European Union

Brussels, 31 August 2020 (OR. en)

10304/20 ADD 5

PHARM 34 SAN 284 MI 292 COMPET 366

COVER NOTE

From: Secretary-General of the European Commission, signed by Mr Jordi AYET PUIGARNAU, Director

date of receipt: 11 August 2020

To: Mr Jeppe TRANHOLM-MIKKELSEN, Secretary-General of the Council of the European Union

No. Cion doc.: SWD(2020) 163 final

Subject: COMMISSION STAFF WORKING DOCUMENT EVALUATION Joint evaluation of Regulation (EC) No 1901/2006 i of the European

Parliament and of the Council of 12 December 2006 on medicinal products for paediatric use and Regulation (EC) No 141/2000 i of the European Parliament and of the Council of 16 December 1999 on orphan medicinal products

Delegations will find attached document SWD(2020) 163 final, PART 6/6.

Encl.: SWD(2020) 163 final, PART 6/6

EUROPEAN COMMISSION

Brussels, 11.8.2020 SWD(2020) 163 final

PART 6/6

COMMISSION STAFF WORKING DOCUMENT

EVALUATION

Joint evaluation of Regulation (EC) No 1901/2006 i of the European Parliament and of the

Council of 12 December 2006 on medicinal products for paediatric use and Regulation (EC)

No 141/2000 of the European Parliament and of the Council of 16 December 1999 on

orphan medicinal products

{SEC(2020) 291 final} - {SWD(2020) 164 final}

A NNEX 4: C OSTS AND B ENEFITS

This Annex provides a table giving an overview of all costs and benefits.

OVERVIEW OF COSTS AND BENEFITS OF THE ORPHAN REGULATION

Citizens/Consumers Businesses Administrations

Qualitative Quantitative / Qualitative Quantitative / monetary Qualitative Quantitative / monetary monetary

Aid for Economic cost With the very limited These costs have been research for EU and information available, it estimated at -/- €1.1b

various national was not possible to governments, assess the extent to which provided which these additional subsides to R&D expenditures stimulate the would have been development of incurred orphan without the Orphan medicines. Regulation.

Directly related to the rewards of the Orphan Regulation

Fee waiver, Interviewees from The value of those The costs of this protocol industry have rewards can be expressed assistance, which are

assistance Economic cost suggested that in monetary terms. The incurred by the EMA, for protocol value of the provision of are fully financed by administration assistance is most the fee waiver and the EU and have been

(EMA) valuable to protocol assistance estimated at -/- €0.2b relatively rewards under the EU

Economic inexperienced Orphan Regulation during benefit for developers. In 2000-2017 is estimated at

businesses general, €0.16b (discounted value developers of 2018).

products for which demonstration of

226

significant benefit is required stand to benefit from protocol assistance. The importance of fee reductions is higher for SMEs (for which fees can be waived completely) than for large pharmaceutical companies for whom such fees are a relatively minor cost

Administratio Additional Member States Annual costs for EMA n: economic cost contribute indirectly by and national

EMA/COMP resulting from nominating national governments have been costs the tasks that experts as members to assessed based on the

EMA executes the COMP. These approximate number of in relation to the members are not staff (in full time EU Orphan reimbursed for their equivalents) involved Regulation, as work in the COMP. The in the various activities well as the cost organisations from relating to the EU borne by the which they are seconded Orphan Regulation. EEA member thus indirectly bear the states and other costs as a result of time -/- €0.02b

227

organisations in spent by COMP relation to the members outside these meetings of the institutions. No various estimates are available of committees these costs. discussing applications for orphan designations and marketing authorisations.

Directly related to the rewards of the Orphan Regulation

R&D costs for Economic cost Companies were As the results from the new orphan for businesses reluctant to consultations did not medicines provide provide a sufficiently

information on robust input for our absolute analysis, the study used expenditure on estimates of R&D costs R&D on orphan for orphan medicines medicines. An found in literature. Using attempt was made the above estimates and to gain insight assumptions, the EU into the relative Orphan Regulation is costs of estimated to have led to an development of increase of €11.0b

228

orphan medicines (discounted value 2018) in

(compared to non R&D expenditure for

orphans). orphan medicines in the

However, such period 2000-2017.

information could

not be used in any

meaningful way

(few and different

answers). As the

results from the

consultations did

not provide a

sufficiently robust

input for our

analysis, the study

used estimates of

R&D costs for

orphan medicines

found in

literature.

Extra costs for Economic cost The assessment of these manufacturin for businesses costs was based on the g, marketing, methodology used to distribution assess the economic value orphan of the market exclusivity medicine reward. Based on the extra

sales of €19.1b (see below), these costs over the years 2000-2017 were

229

assessed at €12.04b (discounted value 2018) after deducting from the extra sales benefits to the industry related to an exclusivity margin (30%) and a competitive profit margin (10%); the latter assumed to be a margin that would (continue) to apply even when generic price competition occurs and hence already applies as a benefit during market exclusivity.

Private -/- €0.7b contribution The private to health care contribution costs 1 by patients is

assessed at 3% of additional health care costs.

1 In the analysis it was assumed that, in the EU, the large majority (97%) of all health care costs that are directly due to treatment with orphan medicines (excluding associated costs of treatment) is financed from public sources.

230

Change in NDA non-health costs of disease

Additional NDA NDA impact on health costs

Extra health Economic costs Direct impacts on health The extra costs for the care costs for the (national) care costs are typically health care system financing health system. taken into account in have been assumed to

These are the Health Technology be equal to the extra costs related to Assessment (HTA). revenues realised by providing HTA reports were industry (sales medicines to identified for 32 orphan revenues and revenues patients living medicines that contain deriving from market with rare information on ICERs, exclusivity19,1b + diseases. but only a few of them 4,6b). disclose the additional underpinning -/- €23.7b information. As a result, the impact on additional costs of treatment with orphan medicines or cost-savings in the health care system could not be assessed.

Costs relating Economic cost A large part of the For the analysis a 97%- to financing of for health sector additional health care 3% division has been

231

extra costs of costs is reimbursed from used between public the health collective sources (either and private financing. sector government budgets, Health care financing

collective health costs were estimated at

insurance systems or -/- €23.0b

otherwise). Healthcare

systems across the EU

Member States are

organised and financed

in different ways.

Surveys with

representatives of

national authorities

provided some relevant

information. Based on

this information, only a

small proportion of costs

related to orphan

medicines was

considered to be

financed from out-ofpocket

expenses by

patients, most likely less

than 5% of the total

Extra sales Economic The estimated value of revenues benefit for increased sales of orphan

businesses medicines in the EU market in 2000-2017 of an estimated value of €19,11

232

b (discounted value). Almost 45% of this is due to sales from newly developed orphan medicines, another 44% is due to faster access to EU/EAA market of the other 110 orphan medicines and 11% due to wider spread of medicines.

Revenues Economic In the survey to As the additional R&D from market benefit for developers, the compensation offered by exclusivity businesses market exclusivity market exclusivity may reward reward was co-exist with (multiple)

identified as the other forms of protection most important (for instance, when the incentive of the market exclusivity period EU Orphan overlaps with the Regulation, with patent/SPC protection), its 95% considering value could not be it ‘important’ or, quantified. Only the most often, ‘very impact of the longer important’. duration of the protection could be taken into account. On average, the additional protection period resulting from the market exclusivity was 3.4

233

years. The estimated value of this extra R&D compensation was €4.59b.

Revenues for Economic The extra costs for the the health benefit for health systems system (national) resulting from the EU

health system Orphan Regulation need to be recovered from public and private sources. It has been assumed in the analysis that such costs are fully covered, implying that costs and benefits for the health system are balanced. Effectively, this means that the cost estimates provided here are carried over to another set of

stakeholders, including governments (in case of publicly funded health systems) and patients (e.g. through insurance premiums and when co-payments apply). €23,7b

234

Health Benefits concern The level of Based on a benefits the health benefits has multiplication

improvement been assessed of the in the quality of using information calculated life of patients on the ICERs (range due to the Incremental Cost€54,000 to treatment with Effectiveness €110,000) and orphan Ratio (ICER 3 ), the estimated medicines. from HTA extra health These benefits reports. care costs can be expressed presented in terms of the above, it is number of estimated that, quality-adjusted as a result of life years the Regulation, (QALY) 2 gained 210,000 to by patients. 440,000 QALYs were gained.

2 A QALY is a measure of the state of health of a person or group in which the benefits, in terms of length of life, are adjusted to reflect the quality of life. One QALY is equal to 1 year of life in perfect health. QALYs are calculated by estimating the years of life remaining for a patient following a particular treatment or intervention and weighting each year with a quality-of-life score (on a 0 to 1 scale). It is often measured in terms of the person’s ability to carry out the activities of daily life, and freedom from pain and mental disturbance. ( https://www.nice.org.uk/glossary?letter=q ). For more information about QALY, see for instance: MacKillop & Sheard, 2018, Quantifying life: Understanding the history of Quality-Adjusted Life-Years (QALYs), Social Science and Medicine, volume 211.

3 The incremental cost-effectiveness ratio is the difference in the change in mean costs in the population of interest divided by the difference in the change in mean outcomes in the population of interest. (https://www.nice.org.uk/Glossary?letter=I) It is therefore a measure for the ‘value for money’ a medicine offers in comparison to other treatments.

235

NET benefits -/- €0.7b +€0.82b -/- €24.3b

ICER €54,000 to

€110,000

Net societal €58,000 to cost per €118,000

QALY

NDA: No data available to assess this impact

236

OVERVIEW OF COSTS AND BENEFITS OF THE PAEDIATRIC REGULATION

Citizens/Consumers Businesses Administrations

Qualitative Quantitative / Qualitative Quantitative / monetary Qualitative Quantitative / monetary monetary

Costs for These costs have been compliance estimated at €2,0 b per with the year.

Regulation - Economic cost

Research for businesses to conduct The costs incurred The estimated average

paediatric by individual PIPs cost of each PIP is of clinical research vary significantly €18,9 m (cost incurred mandated by the depending by the over several years).

Regulation type of clinical trials to be

Directly related conducted, the to the Paediatric number of

Regulation subjects involved and the

therapeutic area concerned

Costs for Economic cost The costs are related to the compliance Administrative filing of a PIP applications with the costs for and are estimated at €82

Regulation – businesses to m per year.

Administrativ comply with the e costs Regulation

237

Directly related to the Paediatric Regulation

Costs Costs for the Costs estimated on the Estimated annual costs Administratio remuneration of basis of unpublished for NCAs for PIP n: the National data collected in the related procedures: remuneration competent framework of the of the work of authorities for evaluation of the EMA PIP assessments: € 0,6 national their work on fees system. m competent PIP related PIP waivers € 90.000 authorities procedures PIP compliance checks

€50.000

Directly related to the Paediatric Regulation

Costs Economic cost Estimated cost for society society due to € 590 m over linked to the the monopoly a 10 year marketing of rent (linked to period paediatric the SPC (€ 551 m are medicinal extension) and estimated to be products revenues of direct costs to

other the national beneficiaries health (like services. wholesalers

238

Directly related to the rewards of the Paediatric Regulation

Benefit Economic 2 estimates have Estimate 1: benefit been calculated, € 199 m over a

To society due one on the basis 10 years to cash and These include: of real data of 8 period non cash -cash benefit products which benefits linked to have obtained an Estimate 2: € following the avoided adverse SPC extension 500 m over a

new paediatric the use of lost their period medicines medicines exclusivity

untested in (estimate 1) and a children second estimate of (avoided future benefits for hospital stays a larger basket of and outpatients products but for visits) which data needed to be extrapolated, - Non cash This basket benefits for includes products which monetary which may not benefit has been receive an SPC calculated: extension improved (estimate 2).

239

treatments for children, reduced mortality, improved quality of life, avoided longterm disabilities, time saved by informal carers

Benefit Economic The estimate has This benefit is estimated benefit been calculated, in € 520 m

For businesses for businesses one on the basis due to the due to the of real data of 8 monopoly rent monopoly rent products which

linked to the have obtained an SPC extension SPC extension and have already Directly related lost their to the Paediatric exclusivity. Regulation

Benefits Economic Only a limited NDA for businesses benefit for number of orphan due to the businesses rewards and obtention of PUMA have been

240

ten orphan granted. There are rewards or for therefore the use of the insufficient data

PUMA to assess their procedure economic value

Benefit Economic The estimation is Estimated in benefit calculated as a €6 b. over 10

Spill over for society result of an years effect for Jobs creation, investment of € 2 society due to promotion of b. in R&D by investments in innovation businesses

R&D by linked to the following the businesses R&D obligations of the linked to the investments by Paediatric

Paediatric businesses Regulation regulation linked to the

Paediatric Regulation

Benefit Economic The estimation is Estimated in €3,2 b. over benefit calculated as a 10 years

Intra industry for businesses result of an and cross intra sector and investment of € 2 industry spill cross-sector jobs b. in R&D by over effect due creation, businesses to investments promotion of following the in R&D by innovation obligations of the businesses linked to the Paediatric

241

linked to the R&D Regulation

Paediatric investments by regulation businesses

linked to the Paediatric Regulation

242

A NNEX 5: A GENCY ’ S COMMITTEES

Preclinical & clinical development Post-MA development

Aid for research

Protocol assistance Market exclusivity

Fee reductions / waivers

Application for orphan Assessment of Granting of Application for Assessment of Granting of

designation application designation Annual reporting marketing MA application, marketing Product launch authorisation and designation authorisation

Potential Sponsor Sponsor

sponsor

COMP: designation COMP: designation criteria criteria

EC EC

CHMP: 1) benefit to

risk, 2) similarity

PDCO (PIP or waiver)

CAT

COMP = Committee for Orphan Medicinal Products; PDCO = Paediatric Committee; PIP = Paediatric

Investigation Plan; CAT = Committee for Advanced Therapies; CHMP = Committee for Medicinal Products for Human Use; MA = Marketing Authorisation.

Source: Orphan study report (2019)

Committee for Orphan Medicinal Products (COMP)

COMP is involved in the implementation of the EU Orphan Regulation. It meets every month

to discuss applications to assess their eligibility against all applicable criteria (e.g. prevalence,

medical plausibility, significant benefit), to determine the orphan indication, to adopt

opinions and prepare summary reports, which are then sent to the European Commission.

These meetings currently take around three days each time.

Whereas it is at the discretion of the Member States to decide who they would like to

nominate, the COMP internally seeks for a good balance of expertise by having members

who represent different clinical fields and backgrounds. Many hold positions in national

ministries or national competent authorities, whereas others hold positions in academia or

clinical practice. However, all members are nominated on a personal title.

Committee for Medicinal Products for Human Use (CHMP)

All products for which a marketing authorisation is sought through the centralised procedure

must be assessed by the Committee for Medicinal Products for Human Use (CHMP),

regardless of whether they have an orphan designation. The CHMP will conduct a scientific

assessment to establish the benefit to risk ratio of the product, and thus determine whether the

product should be allowed onto the European market and, if so, for which therapeutic

indication(s).

The purpose of the scientific assessment performed by the CHMP is thus a different one from

that conducted by the COMP, which focuses on the fulfilment of the criteria for orphan

designation.

The CHMP is also responsible for assessing similarity for applications for marketing

authorisation for products with an orphan designation in case there is already an authorised

product on the market for the same orphan indication that is still protected by market

exclusivity.

Paediatric Committee (PDCO)

Since the introduction of the Paediatric Regulation in 2007, developers should submit a

‘Paediatric Investigation Plan (PIP) for all products “not later than upon completion of the

human pharmacokinetic studies”. 4

Only when there is sufficient justification that paediatric investigations are not warranted,

such as when the product targets a condition that does not affect children, can the obligation

to submit a PIP be waived. In case of compliance with an agreed PIP, a marketing

authorisation holder is eligible for the so-called ‘paediatric extension’, a 6-month extension

of the Supplementary Protection Certificate (SPC). In the case of designated orphan

medicines, however, a different reward is offered in the form of an additional two years of

orphan market exclusivity.

All PIPs are assessed by the Paediatric Committee (PDCO), including in the case of

designated orphan medicines. The Paediatric Regulation and the Orphan Regulation intersect

at the point where products are being developed for the treatment of rare diseases that occur

in children. In such cases, both the COMP and the PDCO have roles to play in the regulatory

assessment process.

To increase cooperation across regions, a discussion forum to regularly exchange information

mainly via teleconferences (‘paediatric cluster’) was formed in 2007, including members of

the US FDA and the Agency (PDCO). The cluster has since been joined by the

Pharmaceuticals and Medical Devices Agency (PMDA) Japan, Health Canada, and the

Australian Therapeutic Goods Administration (TGA) as an observer. In 2013 the Agency and

its US counterpart launched so-called ‘common commentaries’ on paediatric development

plans that have been submitted to both the Agency and FDA and that are therefore being

reviewed by both agencies. While informal and non-binding, these commentaries and

4 Section 5.2.3 of Part 1 of Annex 1 of Directive 2001/83/EC i).

244 discussions between the two agencies have helped to align views and to avoid contradictory

requirements on the paediatric development programme.

Committee for Advanced Therapies (CAT)

An increasing share of orphan medicines fall into the category of ‘advanced therapy

medicinal products’ (ATMPs). In 2007, the new EU Regulation for ATMPs, Regulation (EC)

No 1394/2007, was introduced which “lays down specific rules concerning the authorisation,

supervision and pharmacovigilance of advanced therapy medicinal products” (Article 1).

Along with the introduction of the Regulation, the Committee for Advanced Therapies (CAT)

was established, which is responsible for conducting the assessment of whether a product

meets the criteria for designation as an ATMP.

Like the orphan designation, designation as an ATMP is optional. The ATMP Regulation

offers a set of incentives to developers of ATMPs. These incentives are all linked to the

Agency’s services and procedures.

Unlike the Orphan Regulation and the Paediatric Regulation, the ATMP Regulation does not

provide any incentives in the form of extended market exclusivity rights. The incentives

conferred by the ATMP classification are cumulative to those that come with the orphan

designation.

245

A NNEX 6: I MPLEMENTATION OF THE VARIOUS INCENTIVES

Incentives (Regulation)

Market exclusivity

This exclusivity means that a regulatory competent authority cannot authorise the same or a

‘similar’ medicine for the same orphan indication, nor can it take an application for

authorisation into consideration whilst an exclusivity period is in effect on a first product,

even when that product is not protected by a patent. 5

It can be extended by two more years if the application for a marketing authorisation includes

the results of all studies conducted in compliance with an agreed Paediatric Investigation Plan

(PIP). 6

Market exclusivity for orphan medicines is cumulative with patents/supplementary protection

certificates and with existing regulatory frameworks for data exclusivity and market

protection. 7

Market exclusivity period may be reduced to six years if:

• “at the end of the fifth year, it is established, in respect of the medicinal product

concerned, that the criteria laid down in Article 3 are no longer met, inter alia, where

it is shown on the basis of available evidence that the product is sufficiently profitable

5 Article 8 of Regulation 141/2000 i states: ‘Where a marketing authorisation in respect of an orphan medicinal product is granted (…) or where all the Member States have granted marketing authorisations in accordance with the procedures for mutual recognition (…) the Community and the Member States shall not, for a period of 10 years, accept another application for a marketing authorisation, or grant a marketing authorisation or accept an application to extend an existing marketing authorisation, for the same therapeutic indication, in respect of a similar medicinal product.’ A marketing authorisation for a product similar to one under market exclusivity can only be granted if one of the derogation options under Article 8(3) of Regulation (EC) No 141/2000 i applies.

6 See article 37 of Regulation No 1901/2006 i on the Regulation on medicinal products for paediatric use.

7 Data exclusivity is a form of protection conferred on the dossier of trial results that the marketing authorisation holder submitted to obtain approval. The exclusivity means that for a period of 8 years, a company that seeks to produce a generic version of the product cannot reference the data. The scope of protection thus differs from the market exclusivity in that the protection is on the data rather than on the product.

After the 8-year data exclusivity, the marketing authorisation holder still is entitled to a 2-year period of market protection during which it has the sole right to market the product. One additional year of market

protection (represented by ‘+1’) can be granted in the case of: 1. Additional therapeutic indications with significant therapeutic value, 2. New indications for well-established substances, or 3. When new data is submitted to support a change in classification. During the period in between the expiry of data exclusivity and that of market protection, third parties can file for a marketing authorisation by referring to the data of the reference product but cannot yet bring the product on the market. This differs from the orphan market exclusivity, during which the Agency will not yet consider any such applications. Together, the scope of protection from data exclusivity and market protection also differs from that of market exclusivity in that all subsequent variations of the product or any additional indications cannot trigger a new period of protection, as these would come under the same Global Marketing Authorisation.

not to justify maintenance of market exclusivity. To that end, a Member State shall

inform the Agency that the criterion on the basis of which market exclusivity was

granted may not be met and th4e Agency shall then initiate the procedure laid down in

Article 5.

Protocol assistance

While the market exclusivity reward can be seen as the major incentive for the development

and marketing of orphan medicines, particularly for the eventual marketing authorisation

holder, the EU Orphan Regulation also foresees in the provision of a specific form of

scientific advice by the Agency, known as ‘protocol assistance’ for orphan medicine

developers (Article 6). This implies that, in addition to the general scientific advice the 8

Agency can provide on appropriate tests and studies in the development of a medicine,

orphan medicine developers can seek advice in relation to the criteria for authorisation of

orphan medicines.

Fee waivers

If sponsors obtain a marketing authorisation or make use of other services of the Agency,

they normally have to pay certain fees (European Medicines Agency, 2017c). Various main

fee categories can herein be distinguished, including:

• Centralised procedure, covering fees for the application, extension and variations to a

marketing authorisation;

• Scientific advice; • Scientific services.

The system contains various exemptions, such as fee reductions for small or medium-sized

enterprises (SMEs), some fee reductions in case of multiple applications on usage patent

grounds, as well as fee reductions for designated orphan medicines. The latter is funded by a

special annual contribution to the Agency (Article 7 sub 2).

Table A.32: Fee reduction for designation orphan medicines

Procedure or service Applicable to Reduction

Protocol assistance, initial and follow-up SME sponsors for all 100% requests assistance

8 Article 6 of Regulation 141/2000 i states: “The sponsor of an orphan medicine may, prior to the submission of an application for marketing authorisation, request advice from the Agency on the conduct of the various tests and trials necessary to demonstrate the quality, safety and efficacy of the medicinal product (…)”.

247 Non-SME sponsors for non 75% paediatric-related assistance

Non-SME sponsors for 100% paediatric-related assistance

Pre-authorisation inspection All sponsors 100%

Initial marketing authorisation SME sponsors 100%

application Non-SME sponsors 10%

Post-authorisation applications and SME sponsors 100% annual fee, specified in Council

Regulation (EC) No 297/95 i, in the first year from granting of a marketing authorisation

Pharmacovigilance fees, specified in All sponsors n/a

Regulation (EU) 658/2014 i

Source: Orphan study report (2019)

Aid for research

Besides the market exclusivity reward, the protocol assistance and the fee waiver, the EU

Orphan Regulation introduced the incentive ‘aid for research’ (Article 9). This incentive 9

makes it possible for the European Commission and/or Member States to provide additional

funding for the research and development of designated products. The self-evident intent of

this incentive is to further encourage investments in, in particular, the early stages of research

into rare diseases. Such basic research is important to elucidate the mechanisms underpinning

rare diseases, which in turn is a prerequisite for product development.

What these European and national programmes together demonstrate is that, overall, in the 18

years since the introduction of the EU Orphan Regulation, there has been a clear increase in

research-related accompanying measures, and specifically in the:

• Level of public funding available for rare disease research, at the EU and national

levels;

• Level of coordination of national and international research agendas in rare diseases;

9 Article 9 of Regulation 141/2000 i states: ‘Medicinal products designated as orphan medicines under the provisions of this Regulation shall be eligible for incentives made available by the Community and by the Member States to support research into, and the development and availability of, orphan medicines and in particular aid for research for small- and medium-sized undertakings provided for in framework programmes for research and technological development.’

248

• Extent of the data and knowledge infrastructure for rare diseases, from patient

registries to biobanks.

EU research and innovation programmes

EU Framework Programmes

The EU’s support for rare disease research was initiated within the fourth EU RTD

Framework Programme (FP4) and confirmed and expanded within the fifth Framework

Programme (FP5), with the number of supported projects increasing from 23 within FP4 to

47 within FP5.

In the intervening period and following the implementation of the EU Orphan Regulation in

2000, the EU reconfirmed its commitment to rare disease research with a larger programme

of work within each successive EU RTD Framework Programme.

Since 2000 for more than two decades, rare disease research has been a priority for the EU. 10

More specifically, the sixth Framework Programme for research and technological

development (2002-2006) (FP6) supported 59 projects with approximately €230 m. The

seventh Framework Programme 11 for research, technological development and demonstration

activities (2007-2013) (FP7) supported more than 120 rare disease projects under the Health

theme with approximately €620 m. Support was available for projects that shed light on the

course and/or mechanisms of rare diseases, or test diagnostic, preventive or therapeutic

approaches. 12

Horizon 2020 13 has continued the EU’s commitment to funding rare disease research and

upon its completion will likely have more than doubled the investment made under FP7. In its

2017 publication, the European Commission indicated that, in 164 collaborative research 14

projects into rare diseases had been supported until that time by FP7 and H2020, with a total

value of €874m out of which SMEs were supported with €180m. Horizon 2020 and FP7

combined have committed more than €1b to collaborative rare disease research over the last

ten years.

10 https://ec.europa.eu/info/research-and-innovation/strategy/support-policy-making/scientific-support-eu href="https://ec.europa.eu/info/research-and-innovation/strategy/support-policy-making/scientific-support-eu-policies/p4p_en">policies/p4p_en

11 https://wayback.archive-it.org/12090/20191127213419/https:/ec.europa.eu/research/fp7/index_en.cfm

12 European Commission (2016), Working document: Ex-Post Evaluation of the Seventh Framework

Programme, January 2016. 13 http://ec.europa.eu/research/participants/data/ref/h2020/wp/2018-2020/main/h2020-wp1820-health_en.pdf 14 https://op.europa.eu/en/publication-detail/-/publication/c2ba4fd4-ae31-11e7-837e-01aa75ed71a1/languageen/format-PDF/source-69927191

249 ERA-Net research programmes on rare diseases

The ERA-Net research programmes on rare disease research (E-Rare) 15,16 are a good example

of the evolution of the Members States coordinated efforts in support to rare disease research

in the 19 years following the implementation of the EU Orphan Regulation.

E-Rare was implemented first in 2006, in the closing stages of the sixth European RTD

Framework Programme (FP6) with the aim of fostering an increased focus on rare disease

research at the level of individual EU member states. 17 The pooled national funds were

matched by EC funds and were used to support various coordination activities (e.g. setting of

a common research agenda) and to fund transnational research to complement the bigger

multinational groups funded by the EU.

The initial partnership, E-Rare 1, consisted of eight countries who issued two transnational

calls in 2007 and 2009. The Commission approved a follow-on project under FP7 (E-Rare 2),

which ran from 2010-2014. E-Rare 2 had an expanded network, with the original eight EU

member states increasing to 15 countries and with annual calls for proposals. In addition to an

increase in the number of research projects supported, the network also redoubled its efforts

to enhance coordination among member states by enabling information exchange and

extension of the rare disease research funders’ network.

The network earlier success led to a further proposal within Horizon 2020 and the launch of

E-Rare 3, again with a larger membership and an expanded agenda. E-Rare 3 is made up of

25 public bodies, ministries and research funding organisations from 17 countries. Since its 18

inception, E-Rare has launched eight Joint Transnational Calls (JTCs) for projects, with a

total investment value of €92m.

The E-Rare network has established good links with the international rare diseases research

community and its programme of work follows the basic guidelines defined by the

International Rare Disease Research Consortium (IRDiRC).

International Rare Disease Research Consortium

15 http://www.erare.eu

16 Julkowska D et al. The importance of international collaboration for rare diseases research: a European perspective. Gene Ther. 2017:24(9):562-57

17 The ERA-NET instrument is a generic instrument that provides EC financial support to Member State level ‘public-public’ partnerships (typically amongst research funders) in the preparation and implementation of joint research actions of a transnational nature.

18 Austria, Belgium, France, Germany, Greece, Hungary, Italy, Latvia, Poland, Portugal, Romania, Spain, the Netherlands, Switzerland, Israel, Turkey, Canada and Japan.

250 The European Commission has been actively driving international research collaboration in

rare diseases. IRDiRC was established in 2011 by the European Commission (DG RTD)

together with the US National Institutes of Health (NIH) and aims to strengthen rare disease

research by coordinating rare disease research funding 19 at the global level. IRDiRC is a

model of international research policy collaboration that brings together 59 organisations

funding rare diseases research, patient advocates and industry, across five continents. The 20

IRDiRC recognises that coordinating efforts to overcome common barriers in the

development of orphan medicines is key to maximising the impact of collective global

investments. IRDiRC’s Therapies Scientific Committee launched recently the Orphan Drug

Development Guidebook 21 , which aims at facilitating medicines development for rare

diseases by organizing available tools in USA, Europe and Japan into a standardized

framework.

Capitalizing on the momentum of this progress, IRDiRC devised its goals for the decade 2017-2027, to:

• enable all people living with a rare disease to receive an accurate diagnosis, care, and

available therapy within one year of coming to medical attention

• catalyse the approval of 1000 new therapies for rare diseases, the majority of which will

focus on diseases without approved options.

RD-ACTION

The RD-ACTION 22 (2015-2018) project was set up to meet diverse challenges of rare

diseases at EU level: it must expand and consolidate the achievements of two previous Joint

Actions on Rare Diseases supported by the European Commission: Orphanet and the

European Union Committee of Experts on Rare Diseases (EUCERD) Joint Action. 23

European Reference Networks

19 http://www.irdirc.org/

20 26 EU Member States (Austria, Belgium, Bulgaria, Croatia, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Poland, Portugal, Romania, Slovakia, Slovenia, Sweden, Spain, The Netherlands); 7 associated (Armenia, Georgia, Israel, Norway, Serbia, Switzerland, Turkey), UK and Canada.

21 https://irdirc.org/activities/task-forces/orphan-drug-development-guidebook-task-force/

22 http://www.rd-action.eu/

23 The mandate of the EUCERD expired in 2014. The EUCERD has been succeeded by the European Commission Expert Group on Rare Diseases.

251 A European initiative to support both patient care and research on rare diseases is the creation

of European Reference Networks (ERNs). 24 The ERNs primarily focus on the provision of

advice, via an IT tool, on concrete patient's cases (for diagnosis and treatment) but also serve

as information, research and knowledge centres with the aim of contributing to the most

recent scientific findings.

Research is a key element of the ERNs, providing an integrated structure to facilitate

collaboration and creating a knowledge hub to encourage translational research and the

creation of cross-border registries. In March 2017, the first 24 ERNs were launched.

EU contributions to rare disease research

The EU has invested considerably in research for rare disease in other ways. This includes for

instance support for basic research, such as what is supported through the EU framework

programmes and support for the creation of an infrastructure to promote knowledge sharing.

Estimates of the financial contributions so far have been summarised in Table A.12.

Table A.33: EC funding contributions to rare disease research

Initiative EC contribution to rare disease research

Seventh Framework €624m (based on non-public data provided by DG RTD extracted

Programme for from the Cordis database)

Research and

Innovation (FP7)

Horizon 2020 and Contribution of €180-185m by the EC (€5m to E-Rare 1 and E-

ERA-NETs (E-Rare 1, Rare2, nearly €120 m for new therapies for rare diseases , €5m for

2 and 3) integration and opening research infrastructures and €55m for the

Rare Disease European Joint Programme Cofund)

In E-Rare 1 (2006-2010), and E-Rare 2 (2010-2014) overall

€56.4m was invested. (Aymé S, 2013) In E-rare 3 (2015-2019),

more than €90m was invested. (European Commission, 2017b)

252 RD-ACTION (‘joint €8.3m. (Hedley et al., 2016).

action’ on rare diseases)

European Reference The ERNs are supported from several EU funding programmes,

Networks including the Health Programme, the Connecting Europe Facility

and Horizon 2020.

Source: Orphan report (2019)

National research activities

At the level of the EU Member States, various ‘other incentives’ have been put in place to

complement the EU Orphan Regulation and further support the development of orphan

medicinal products.

A prominent place herein is taken by national rare disease plans. Such national rare disease

plans are aimed at guiding and structuring relevant actions in the field of rare diseases within

the framework of their health and social systems. They commonly include a commitment to

research funding.

It is, however, not known to what extent commitments have been converted into actual

spending on research for rare diseases and development of orphan medicines. 25

T HE RESEARCH AND COORDINATION ASPECTS OF THE NATIONAL PLANS ANALYSED REVEALED A REASONABLY CONSISTENT PICTURE . A MAJORITY OF MEMBER STATES HAVE ( OR HAD ) A NATIONAL PROGRAMME FOR RARE DISEASE RESEARCH . I N MOST CASES , THERE ARE SPECIFIC RARE DISEASE PROGRAMMES . I N A MINORITY OF CASES , SUPPORT IS

AVAILABLE THROUGH A BROADER MEDICAL RESEARCH PROGRAMME WHERE RARE DISEASE

RESEARCH PROPOSALS WILL HAVE TO WIN GRANT FUNDING IN COMPETITION WITH

25 Publications on existing programmes and their impact do not always make a distinction between

(fundamental) research in the field of rare disease and the development of orphan medicines.

253

A NNEX 7: I NTERNATIONAL CONTEXT

Comparison of criteria for orphan designation in the EU, US and Japan

EU US Japan

Orphan condition < 5 in 10,000 in EEA; OR ≤ 6 in 10,000 in US; OR < 4 in 10,000 in Japan;

without incentives it is unlikely that an orphan subset of a non-rare disease; condition where the the marketing would generate characteristics of the medicinal product limit its use in a particular sufficient return to justify the subgroup; OR investment. there is no reasonable expectation that the sales of the drug will be sufficient to offset the costs of developing the drug for the US market and the costs of making the drug available in the US.

Medical need No satisfactory methods of Not a criterion unless the same drug has previously been approved No appropriate alternative treatment (or prevention or for the same use or indication, clinical superiority needs to be proven drug/medical device treatment for diagnosis) for life-threatening or as follows: serious disease including difficult to chronically debilitating condition treat the disease; OR

exist; OR Shown to provide a significant therapeutic advantage over an approved drug in one or more of the following ways: higher efficacy or safety is expected

if any such methods exist the (i) Greater effectiveness; compared with existing products. medicinal product must be of (ii) Greater safety in a substantial portion of the target populations;

significant benefit to those affected (iii) In unusual cases, where neither greater safety nor greater

by the condition, i.e.: effectiveness has been shown, a demonstration that the drug

• a. 

  conferring a clinically relevant otherwise makes a major contribution to patient care.

advantage; OR

• b. 

  a major contribution to patient care.

Medical Usually in vivo data. Clinical study data or case reports if available; in vivo animal data; in Non-clinical and clinical data in the plausibility/ vitro data if no clinical or in vivo data available latter half of the phase I study or in scientific rationale the first half of the phase II study.

254 Table A.34: Key differences in the procedures for orphan designation in the EU, US and Japan

Items EU US Japan

Application Committee for Orphan Office of Orphan Products Ministry of Health, Labour to Medicinal Products (COMP). Development (OOPD). and Welfare (MHLW)

Timetable Timetable for submission and Any time; no defined Any time; no defined

assessment published by the timetable; timetable;

Agency.

Key aspects Prevalence; Prevalence. Prevalence;

of the

application Medical need; Scientific rationale. Medical need;

Medical plausibility. Possibility of development.

Sponsor Proof of establishment in EU. Not required. Not required.

established

in territory

Translations Translations of product name Not required. Application in Japanese.

and proposed orphan indication

into all official languages of the

EU plus Icelandic and Norwegian.

In the US, a medicinal product is eligible for orphan designation when it is intended to treat a

disease that affects less than 200 000 persons (which is equivalent to 6 in 10,000) in the US

or affects more than 200 000 persons and for which there is no reasonable expectation that

the cost of developing and making a medicinal product for such disease or condition will be recovered from sales. 26 In addition, in the US an orphan designation may be given to an

orphan subset of a non-rare disease condition where the characteristics of the medicinal

product limit its use in a particular subgroup. 27

26 Orphan Drugs Act of 1983. Public law 97/414, 97th Congress, Jan 4, 1983.

Table A.35: Comparison of incentives offered by the EU, US and Japanese regulatory

frameworks to support OMP development

EU USA Japan Australia

Year of introduction 2000 1983 1985 1997

Financial incentives Fee reductions / Tax credits, fee Subsidies for Fee waivers

waivers waivers research, fee

waivers, tax

credits and

reductions

Market exclusivity 10 (+2) years 7 years 10 years No

Scientific advice Yes (free) Yes (free) Yes (reduced Yes

(protocol assistance) fees)

Aid for research EC Framework FDA Orphan Grants No

Programmes Products Grant programmes

Program; NIH

grants

Regulatory tools to Priority Fast-track Priority review; Possibility to

accelerate approval medicines approval; Fast-track rapid review

(PRIME); approval

centralised Breakthrough procedure; designation; conditional Accelerated approval; approval approval under pathway;

exceptional Priority review circumstances; designation

accelerated

assessment

256 Figure A.36: US, EU & Japan Orphan Designations per Year (2003-2017)

Source: EvaluatePharma 2018.

Figure A.37: Common orphan designations in the US, EU and Japan (n=4116)

US

2645

134 554

57

Japan 2 EU

171 553

Modified from Murakami M and Narukawa M, Drug Discovery Today, (2016), 21(4):544-549

257

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