The Cost of Orphan Drugs

For some time now, I have been interested in the particular challenges raised by rare diseases and the orphan drugs needed to treat them. Since they affect such a small section of the society, the economics of the modern pharmaceutical industry makes it hard to both discover a therapeutic remedy and offer it at a price that the few that need to avail of it can afford.

Earlier this year I devoted an episode on my podcast Ex Machina to the story of a family in Bangalore that refused to give in to the inevitability of their fate. And late last month there was a small but significant addendum to that story.

This is an expanded version of the article I wrote for my weekly Ex Machina column in The Mint. You can read the original article at this link.


Earlier this year, I released an episode of my podcast that told the story of Karanveer Singh, a boy in Bangalore who was afflicted with a rare degenerative muscular disease. The episode describes the struggles of his family as they tried to find a way to mitigate the effects of a disease that had resulted in such severe muscular atrophy that Karan was already confined to a wheelchair. It was absolutely clear that if they did not do something about it fast, the disease would eventually claim his life.

Duchenne’s Muscular Dystrophy (DMD) is a genetic disease caused by a mutation in the DMD gene. This gene is responsible for the production of dystrophin—a protein that is present in the membrane that surrounds muscle fibres and protects them from wear and tear during normal expansion and contraction. Without dystrophin, muscles steadily degenerate in the course of regular daily movement, until they eventually wear out completely.

Children afflicted with Duchenne’s have a mutation in one or more of the exons in their DMD gene, as a result of which their body is incapable of producing the dystrophin it needs. By the age of four, these children usually show evidence of muscular weakness and progressively lose their ability to use their muscles till they eventually develop serious cardiac and respiratory problems that eventually lead to death.

There is no known cure for Duchenne’s. Those who have the disorder usually don’t live past their twenties without treatment.

What is remarkable about Karan’s story is that even though his parents were told that there was no cure, they refused to give up. They set up an organisation called the Dystrophy Annihilation Research Trust (DART), and began to chase down all sorts of treatments to find a solution. Their perseverance paid off. They were able to track down an experimental therapy that worked by tricking the dystrophin production process into skipping the missing exon/s—so that instead of stopping cold at the DNA error, it overlooked the mutation and continued past it to start expressing dystrophin.

As much as this is a story about the remarkable grit of a family faced with impossible odds, it is also a description of the bureaucratic obstacles that lie in the path of anyone looking to deploy a hitherto unheard of life-saving therapy for rare diseases. In Karan’s case, thanks to a fortuitous intervention, the Indian Council for Medical Research funded a clinical study of the therapy which, once administered to Karan, showed remarkable results.

However, this was a one-off approval for research on a therapy which had yet to be approved at that time anywhere in the world for DMD patients with the particular mutation that Karan has. In order for this treatment to be available to the thousands of children in the country suffering from DMD, what was needed was a clinical trial that proved the efficacy of the drug. The podcast ends with Karan’s father railing against the bureaucracy that permeates the drug approval process, with him asking how many more children would need to die before we are allowed to give them a drug that could save their lives.

Late last month, the Central Licensing Authority under the Directorate General of Health Services permitted the conduct of a clinical trial of the therapy in multiple centres across the country. The approval was largely based on the overwhelming success of the clinical study of the therapy on Karan and the fact that it had absolutely no adverse effects. If successful, the clinical trial will offer hope to thousands of families around the country whose children have been diagnosed with this genetic condition, and who, without this therapy, have no option but to resign themselves to a slow yet inevitable fate.

But, while the successful conclusion of the clinical trial will permit the drug to be manufactured in India and administered to patients who need it, what is even more heartening is the cost at which DART’s therapy will be made available in the country.

DMD belongs to a category of rare diseases that affect such a small section of the population that it is simply not worth the while of big pharmaceutical companies, which have the resources to find a cure, to invest in research and development (R&D) for their treatment. I have written previously about rare diseases in India and the commercial imperatives that drive corporate decisions about their pricing:

But even if they are incentivised to develop drugs to treat rare diseases, pharmaceutical companies remain beholden to the laws of economics and, given the low demand for orphan drugs, price these drugs as high as they choose to. By way of example, Rituximab, an orphan oncology drug, is the world’s second highest revenue generating drug by lifetime revenue potential. While all this may be less of a concern to patients in Western countries, covered as they are by comprehensive healthcare plans, it forces patients in developing countries to deal with the uncomfortable realisation that even though a cure exists for their condition, it is wholly unaffordable.

The fact of the matter is that pharmaceutical companies have to recoup their investment in a new drug by amortising R&D costs over the entire population to which the therapeutic product is eventually administered. This is why blockbuster drugs invariably tend to be those that are prescribed to such a large number of people that they offer manufacturers very high returns on investment. Where a disease afflicts only a small portion of the general population, private drug companies have little or no incentive to invest in the research and development of its treatment. Those drugs that do get manufactured to treat rare diseases are sold at such exorbitant prices that they end up out of the reach of patients who need them the most.

If the same treatment for DMD that DART is seeking drug approval for were to be procured from the US or any other Western country, it would likely cost in the region of $300,000 per year for a 20kg child—and proportionately more if the child is heavier. In terms of Indian currency, that works out to nearly ₹2.5 crore (INR 25,000,000) per annum.

Which is why the approval granted to DART for their clinical trial is so significant. If approved, DART’s treatment will cost just ₹20 lakh (INR 2,000,000) a year.