Covid-19 And The Orphan Drug Act – Economics – Free PDF Download

CURRENT AFFAIR

• Recently, the World Health Organisation (WHO) declared the Covid-19 outbreak a pandemic.
• However, the United States Food and Drug Administration (FDA) declared Covid-19 an orphan disease, or a rare disease.

DETAILS

• The FDA granted Gilead Sciences orphan drug status for its antiviral drug, Remdesivir, on March 23, 2020.
• Originally developed to treat Ebola, the drug is now being tested for treating COVID-19.
• Clinical trials are already in Phase III.
• But on March 25 Gilead announced that it had submitted a request to the FDA to remove its orphan drug designation for Remdesivir.
• Earlier, Gilead had sought the orphan status to the Remdesivir drug to expedite approval of the drug.
• However, advocates for global access to medicines, rejected the company’s argument.
• Gilead’s exorbitant pricing of its drug to treat hepatitis C and its drug to treat HIV also attracted attention in the past.
• In recent years, drug companies have been accused of exploiting the law to reap profits, in sales.

Orphan Drug Act, 1983

• Rare diseases became known as orphan diseases .
• In the U.S., under the Orphan Drug Act, companies are provided incentives to develop therapies, or orphan drugs, for rare diseases.
• The Act allows seven years of market exclusivity and financial incentives to innovators of these drugs.
• As a result, orphan drugs are often exorbitantly priced.
• Privileges under the Act may be conferred to companies for drugs to treat a disease that affect less than 200,000 people in the U.S., or for a disease that affects more than 200,000 people but for which there is no hope of recovering R & D costs.
• The idea is that without these incentives, companies would find it difficult to recover their R&D costs given the small number of people suffering from the rare disease.

ISSUES

• Covid-19 not a Rare Disease: 800,049 confirmed cases across the world.
• Paradox: The U.S. FDA conferred the status of an orphan drug on Remdesivir proposed to treat COVID-19 a pandemic.

Impact

• Had Gilead not sought that orphan drug status be revoked, generic manufacturers would not have been able to market a drug to treat COVID-19 with the same active ingredient till the seven-year period of market exclusivity had ended.
• This would have given Gilead free rein on pricing and licensing which would have had disastrous consequences on the healthcare system.
• However, orphan drug status of Remdesivir would have no impact on India as Gilead Sciences holds patents in India.
• As far as its patent rights are concerned, Indian law permits the government to issue a compulsory licence in certain circumstances of a public health crisis under Section 92 of the Patents Act.
• This would allow third parties to manufacture a patented drug without permission of the patent holder.

Rare Diseases

• A health condition of low prevalence that affects a small number of people compared with other prevalent diseases in the general population.
• There is no universally accepted definition of rare diseases.
• Though rare diseases are of low prevalence and individually rare, collectively they affect a considerable proportion of the population.
• 80% of rare diseases are genetic in origin and hence disproportionately impact children.
• In India there are 56-72 million people affected by rare diseases.

National Policy for Treatment of Rare Diseases, 2017

• Highlights the measures and steps, both in the short as well as in the long term, that need to be taken to deal comprehensively with rare diseases.
• Intends to constitute an Inter-ministerial Consultative Committee to coordinate and steer the initiatives of different ministries and departments on rare diseases.
• Mentions the creation of a corpus fund at Central and State level for funding treatment of rare diseases.
• The policy aims to create a patient registry for diseases housed in Indian Council of Medical Research (ICMR).
• It also aims to create awareness among health professionals, families of patients and the public in general, about rare diseases.

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