WASHINGTON - Legislation to amend the Orphan Drug Act of 1983(ODA) was introduced in both the House and the Senate late Thursday,winding up six years of battles which have pitted lawmakers againstindustry, industry against patient advocacy groups and industry againstitself.Industry sources predict the bill will be signed into law by the end of1994."This legislation is the product of extensive discussions and negotiationand represents a genuine compromise among competing interests," saidSen. Nancy Kassebaum (R-KS), who has led the fight to restructure theODA since 1988. "As with any compromise, no party can claim totalvictory."The ODA was designed to provide market and tax incentives forcompanies developing drugs to treat diseases affecting fewer than200,000 people. When orphan drug-designated products such asAmgen Inc.'s erythropoietin (EPO) and Genentech Inc.'s human growthhormone (hGH) became highly profitable, the law was criticized bypoliticians for providing windfall profits.The ODA legislation, called the Orphan Drug Act Amendments of1994, contains several new and significant features:y A guarantee of four years of exclusive marketing rights for an orphandrug, down from seven.y A three-year extension of exclusive marketing rights if the FDAdetermines that an orphan drug has "limited commercial potential."(The commercial potential of a drug would be determined by theSecretary of Health and Human Services using criteria such as salesinformation and other "relevant" data.)y A loss of exclusivity if the orphan drug treats a patient populationwhich exceeds 200,000 people.y A grant of exclusivity to two or more companies if they develop adrug simultaneously.The simultaneous development provision stipulates that once the firstcompany has been granted orphan drug status by the FDA, othercompanies developing a similar drug may qualify for shared marketexclusivity if the following conditions are met: 1) an application fororphan drug status is received by the Department of Health and HumanServices (DHHS) within six months after publication of the firstcompany's designation; 2) human clinical trials are initiated within 12months of the first company's initiation of human clinical trials; and 3)a product license application (PLA) or new drug application (NDA) issubmitted less than one year after the first company's PLA or NDA.Other features of the new legislation include a plan to replace theexisting DHHS's Orphan Products Board with an Office for OrphanDiseases and Conditions. The new office would be advised by an 11-member advisory committee which would include five representativesfrom organizations of persons with rare diseases, three researchscientists and three representatives of health-related companies.Kassebaum said that the new legislation fulfills her longstanding goalof introducing greater competition into the orphan drug market whilepreserving the incentives of the original ODA and better implementingits original intent.The 1994 amendments avoid key features of earlier proposals whichsome in the biotechnology industry had opposed, including the use ofsales caps (between $150 million to $200 million) as the trigger for lossof market exclusivity. In addition, the pending legislation is notretroactive. The new rules would not apply to drugs in human clinicaltrials as of March 1, 1994 or to drugs currently on the market.The Biotechnology Industry Organization (BIO) endorsed the neworphan drug legislation on Friday as did the National Organization forRare Disorders (NORD). According to BIO president Carl Feldbaum,months of intense deal-making preceded the current compromise.Feldbaum predicted that the new bills will sail through the legislativeprocess. "The unusual convergence of interests between industry andCongress on this complex issue will lead to legislative success,enactment and signing," said Feldbaum. He said that the compromisemoves a divisive issue off the table at a time when the industry needs towork closely with Capitol Hill on health care reform.Congress and industry have battled over proposed changes to the ODAsince 1988. Lawmakers argued that the intent of the orphan drugmarket protection was to encourage development of treatments for rarediseases, not to generate huge profits for drug companies and shieldthem from competition. In 1990, President Bush vetoed ODAlegislation which made it through Congress to his desk.Some in the biotechnology industry argued to retain the ODAincentives untouched while others fought to revise them. BIO's twopredecessor organizations, the Industrial Biotechnology Associationand the Association of Biotechnology Companies were split on theissue. The disagreement provoked recriminations and resignations,according to Feldbaum.Ironically, it was some of biotechnology's most successful drugs whichserved to undermine the industry's moral authority in its fight againstchanging the ODA. "It was not realistic to continue to say 'no' torevising the orphan drug act. We had a weak argument on somepoints," conceded Feldbaum.Most of the 23 biotechnology drugs on the market today have receivedorphan drug status from the FDA. Genentech's hGH (Protropin), whichenjoyed orphan drug status until October 1992, and Eli Lilly & Co.'ssimilar product (Humatrope), which lost its ODA market protection onMarch 8, have often been cited by ODA critics as examples ofviolations of the intent of the law. Both drugs rang up huge sales underthe protective umbrella of ODA.Thursday's ODA legislation was sponsored in the Senate (S. 1981) byKassebaum and in the House (H.R. 4160) by Rep. Henry Waxman (D-CA). Co-sponsors in the Senate included Sen. Ted Kennedy (D-MA)and Sen. Howard Metzenbaum (D-OH). Representative Gerry Studds(D-MA) co-sponsored the House bill.
-- Lisa Piercey Washington Editor
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