The Orphan Drug Act was passed in the US in 1983 to encourage drug manufacturers to develop treatments for rare diseases. The act does this by offering a number of major incentives to manufacturers including tax subsidies and credits, the right to waive fees involved in developing products and applying for approval, and years of marketing exclusivity.

However, some worry that the Orphan Drug Act has some major flaws which actually limit drug development rather than enhance it. In response to these growing concerns, FDA commissioner, Scott Gottlieb, has announced that he will begin working on eliminating one major loophole in the act.

The loophole in question allows manufacturers to neglect their responsibility to test drugs in pediatric indications. The issue arises because the act allows pediatric subpopulations of common diseases to be considered orphan conditions. This was intended to promote drug development for pediatric patients, but it often has the opposite effect.

This is because, when a drug manufacturer is awarded an orphan designation for a pediatric population, the company’s drug then becomes statutorily exempt from the provisions put forward by the Pediatric Research Equity Act (PREA). These PREA provisions require a company to study the treatment in pediatric trials for the intended use and other uses.

As such, this means that, “by letting sponsors designate pediatric subpopulations of drugs intended to treat adult diseases, the drug makers receive an unintended ‘free pass’ from having to study drugs in these or other pediatric uses.”

Gottlieb has said that this unintended conflict between the two acts needs to be resolved to ensure that the laws intended to help pediatric patients actually do help them. He will shortly be releasing an FDA draft guidance document which will layout the steps that must be taken to close this loophole.

However, some critics believe that there is more than just this one major issue with the act. For example, there are concerns that the market exclusivity incentive awarded to companies also hinders rare disease patient access to medication. Companies have often been accused of exploiting the Orphan Drug Act by gaining market exclusivity and then driving up the price of their drugs. With no competitor products allowed on the market until the exclusivity period ends, this leaves patients subject to sharp price increases.

Unfortunately, it seems that closing all the loopholes will be a slow process, as Gottlieb and the FDA have not yet made any comment on the additional issues.