Recent Changes at the FDA Impacting Development of Orphan Drugs: What You Need to Know and Why It Matters

For companies wanting to develop therapies for rare diseases, there may never be a better time than now.

As a clinical reviewer in the Division of Hematology Products in the Office of New Drugs, I saw first-hand the significant changes FDA and lawmakers made to incentivize pharmaceutical companies to speed up and expand development of much-needed drugs for rare conditions.

The last several years, with FDA’s Orphan Drug Modernization Plan and the introduction of the Rare Pediatric Disease Designation (RPD) program have been a real turning point.  But to take advantage of these improvements — there are important nuances for pharma companies to understand as they set their strategy to develop therapies for rare diseases.

The Opportunity

It’s estimated that up to 90% of rare diseases are serious or life-threatening and there are many expedited pathways and incentive programs beyond the Orphan Drug Designation of which Sponsors can take advantage.  These include fast -track designation, priority review, and accelerated approval. In a future blog we will go more deeply into the value of these individual programs.

Orphan Drug Designation: Administrative and Policy Changes

A little history for context:  Pharma’s focus in developing orphan drugs and in getting ODD for their products, resulted in such a backlog that the FDA implemented the Orphan Drug Modernization Plan in 2017.  The Agency successfully eliminated the backlog of requests within 90 days and also promised to respond to 100 percent of new orphan drug designations moving forward within 90 days.

In 2018, they made good on their promise – completing review of ALL 507 requests within 90 days.(1)  While that is likely seen as a positive step by drug developers, the short 90-day review period for a Sponsor’s ODD request puts more pressure on regulatory teams to develop a credible and persuasive scientific story about the need and benefit of their product.(2)

Recently, FDA has shifted policy on granting ODD for drugs to treat “orphan subsets” and will no longer grant ODD solely on the basis that the product is intended to treat a rare pediatric subset of a non-rare disease. In a recent guidance the Agency explains that they will now grant ODD to rare pediatric subsets of a non-rare disease only if the disease in pediatric patients is different from the adult population – or if it’s not appropriate to use the product in an adult population.(3)

Understanding and leveraging the Agency’s ODD policy is paramount for drug companies.  It not only grants them access to tax incentives and marketing exclusivity, but also helps guide early strategic development and life-cycle management planning.  It could radically change a company’s strategy for assets in early stages of development.

Incentives for Sponsors Developing Therapies for Pediatric Orphan Diseases

In addition to policy changes regarding ODD policy, the Agency is offering the incentive RPD program. This program awards a priority review voucher to companies that receive marketing approval for new drugs or biologics to prevent or treat a rare pediatric disease. To take advantage of this, Sponsors submitting a marketing application for a rare pediatric disease need to submit a formal request for a voucher. These vouchers are transferrable to another sponsor, and since they can expedite a therapy’s time to market, they can be extremely valuable. Recently, we have seen some vouchers being sold for as much as 100 million dollars.(4)

Progress and a Bump in the Road

While there has been a lot of movement to encourage and expedite the development of therapies for rare diseases over the past decade, there has been a recent step backwards in the incentives available for Sponsor’s developing orphan drugs.  In late 2017, Congress passed legislation that cut the tax credit for clinical trial expenses for rare diseases from 50% to 25%.

Still, the future of drugs being developed for rare disease continues to be bright.  In 2018 there was a record 35 novel drugs approved with ODD. This is the highest number since the passage of the Orphan Drug Act in 1983.(1) This shows that the changes are working and ultimately benefiting the public health by making new therapies available to patients with rare diseases. For companies to take advantage of this, it’s essential they are knowledgeable about – and consider – every option FDA offers to maximize opportunities. This will advance drug development for rare diseases – a win for drug developers – and for the patients who urgently need these therapies.


About the Author

Adam George, PharmD. has more than a decade of experience in clinical drug development and regulatory affairs. Adam uses his prior experience as a clinical reviewer in FDA’s Office of New Drugs, and insights from working with US and European regulatory authorities, to help clients prepare for FDA meetings and regulatory submissions. Connect with Adam on LinkedIn.

1 Maynard, F., Furia-helms, A. (2019, February 28). FDA is Working to Bridge Gaps and meet Needs for Rare Disease Product Development. Retrieved from

2 The required content of a request for ODD is outlined in 21 CFR §316.20 and the Office of Orphan Product Development (OOPD) has created Form FDA 4035 to assist Sponsor’s in creating a succinct and complete submission.

3 Food and Drug Administration. (2018) Clarification of Orphan Designation of Drugs and Biologics for Pediatric Subpopulations of Common Diseases: Guidance for Industry. Maryland: FDA

4 Gaffney, A., et al. (2019, May 24) Regulatory Explainer: Everything You Need to Know About FDA’s Priority Review Vouchers. Retrieved from