Orphan drugs moving ahead

Focus: Their development is a fast-growing segment of the pharmaceutical industry.

August 28, 2005|By Tricia Bishop | Tricia Bishop,SUN STAFF

When Maryland entrepreneur and author Martine Rothblatt learned in 1991 that her daughter, then 8, had a deadly lung disease, the news was made much worse by another discovery: No one seemed interested in developing a drug to treat it.

Rothblatt's daughter has primary pulmonary hypertension, or PPH, a genetic disorder that affects fewer than 1 percent of Americans. It's among the 6,000 rare diseases dubbed orphans by the federal government because the drug industry had abandoned them, aware profits from such treatments might never cover development costs. It can take more than a dozen years and a billion dollars to create a new medication.

However, Rothblatt was driven, and she had an ace in the hole: the 1983 federal Orphan Drug Act, which gives lucrative incentives to those generating drugs for diseases affecting fewer than 200,000 people.

A former satellite communications executive, she created her own biotechnology company in 1996. With the help of the act's incentives, she was able to market a PPH drug in 2002, after just six years of development and at a cost of less than $125 million - a fraction of the price tags associated with treatments for widespread illnesses. By last year, her Silver Spring company, United Therapeutics Corp., had become one of Maryland's most successful biotech businesses and has continued to turn profits ever since.

While still a fraction of the $300 billion pharmaceutical industry, orphan-drug development is one of its fastest-growing segments, doubling in the U.S. over the past two years.

More than 20 years after the legislation to encourage their development, orphan drugs have recently been propelled by some of the larger forces weighing on biotechnology. They've been aided by scientific advancements in genetics and by consumers being more conditioned by the rise of heavily advertised "blockbuster" cures to seek a miracle drug. Also, investors, wary of past biotech busts, want to back a product that can more quickly come to market.

"Coming off the biotech bust, everybody wants to be in product development," said George F. Steinfels, chief business officer at Rockville's Rexahn Corp., which is developing orphan drugs for uncommon cancers.

Several years ago, investors were throwing money at biotechnology, based on promises and potential. But once it became evident that science would need more time to produce certain cures, shareholders and venture capitalists retreated, causing stocks to plummet in 2001. Now, investors prefer to see results before backing a business, and for many, orphan drugs represent a quick way to get them.

Such drugs are more than twice as likely to make it to market as new drugs overall - 18 percent compared with 8 percent. Their approval time is also much shorter than the typical 12 to 15 years for all drugs that successfully emerge from development, in large part because they have smaller scale studies and typically receive expedited review from the Food and Drug Administration. And the government will pay for half of the research and development costs through tax credits, as well as waive expensive filing fees, saving companies more than $700,000.

"The smaller biotechs, and even the specialty drug companies, are beginning to appreciate that this is a market opportunity for them," said Christopher-Paul Milne, assistant director at the Tufts Center for the Study of Drug Development. "This is a market they can live in."

24 million affected

Though the individual diseases are rare, they collectively affect more than 24 million people and their families in the United States. Since the act was implemented, 1,456 drugs have been approved for development and 268 of them have made it to the market, where they collectively treat more than 13 million people, said Dr. Marlene E. Haffner, director of the Office of Orphan Product Development at the FDA.

"These are people that wouldn't have had therapy for their disease prior to the Orphan Drug Act," Haffner said. "For them to have treatment for their particular disease has simply been a godsend."

Last month, Haffner made a pilgrimage to Israel to help that country set up its version of the Orphan Drug Act. Europe, Singapore, Australia and Japan have implemented similar laws in the hope they will help knock off some of their ignored diseases.

"There's just a lot going on right now," Haffner said. "You have to think there's something worthwhile here."

Dozens of biotech companies got their starts by developing orphan treatments, and their ranks are growing. Last year, a record number of orphan drugs were approved for development nationwide: 128 of them. That was up 36 percent from the previous record of 94 new designations in 2003.

In Maryland, more than 20 companies have developed about 85 orphan drugs, at least 16 of which have made it to market, such as Guilford Pharmaceuticals' Gliadel Wafer treatment for brain cancer. Some companies, such as Ceptor Corp. in Hunt Valley, are making orphan drugs their entire focus.

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