The Controversy Behind Deflazacort’s Orphan Drug Designation

Deflazacort (Emflaza) is a corticosteroid drug that has been widely used to treat patients with Duchenne muscular dystrophy (DMD). DMD is an X-linked, fatal disease which affects about 1 in every 5000 male infants around the globe.¹ It is characterized by muscle wasting, which gradually worsens over time, and it is also associated with early onset breathing and heart problems.² Originally manufactured outside of the US under the generic name “deflazacort,” this drug could also be imported from abroad for a relatively reasonable cost of $1300 to $2100 CAD/patient/year, without insurance.³

In February 2017, the US company Marathon Pharmaceuticals obtained approval from the Food and Drug Administration (FDA) to designate deflazacort as an orphan drug, which gave them the exclusive rights to sell it in the US for seven years.⁴ After this, the list price of the drug skyrocketed to $170000, or $71000 with applied discounts and rebates.⁴ This is an example of “evergreening”: repurposing an old drug by reformulation or re-designation before its patent ends to extend the patent length, often resulting in an inflated price.⁵ Although it is typically expensive to manufacture and approve pharmaceuticals, the new list price brought up many concerns, especially considering that it was much higher than that of novel orphan drugs, which require a much bigger financial investment into testing for efficacy and safety than the already established deflazacort.⁵ Furthermore, the company was also issued a Priority Review Voucher (PRV) by the FDA, promising Marathon that it could ask for one of its new drugs to be reviewed in 6 months instead of the standard 10 months - a tool used to incentivize the development of drugs for rare diseases.⁶ Although the PRV does not guarantee approval, it was introduced by Congress in 2007 to solve the issue of pharmaceutical companies not being attracted to the idea of developing drugs that may not have many market opportunities in addition to being costly to approve and manufacture.³ The chance, however, of surpassing their rivals for drug approval, or selling it for profit to another company for up to $460 million, heightens incentive.⁷

Rare disease advocates and those in the pharmaceutical industry argued that Marathon Pharmaceuticals’ application of the Orphan Drug Act designation to the drug deflazacort and acceptance of the priority review voucher awarded by the FDA went against the original objective of the 1983 Orphan Drug Act: “[T]o facilitate the development of drugs for rare diseases and conditions”.³ Approving a voucher for a drug that was already being used to treat DMD abroad since 1985, then setting its list price to 170 times the amount it would cost to import the generic drug per patient per year showed little intent to support the fight against rare diseases. When one considers that Marathon Pharmaceuticals had already obtained financial incentives to approve the drug through this act, such as 7-year exclusivity on the market, waivers of fees, and tax breaks during drug development, the state of the matter becomes increasingly troubling.⁷ Aaron Kesselheim, Associate Professor at Harvard Medical School, explained the take many shared on this special case of evergreening, saying, “How many examples of this do we have to see before we can start to rethink the priority review voucher as a means of incentivizing innovation? This also seems to be another example of gaming the Orphan Drug Act, which was intended to try and encourage research into new therapeutic entities for people who have rare diseases — and it doesn’t seem like this is that”.⁷ While the PRV seems like it would benefit patients with a rare disease by decreasing the amount of time it takes the FDA to approve of a new drug, it fails to consider the complex issues that they might run into when approving a new drug for sale on the market, which may require over 6 months to address. Dr. John Jenkins, director of the FDA, expressed his safety concerns with this speedier process, saying, “We’re not making pizza here”.³ The lack of observed results demonstrating effectiveness of the PRV had also been addressed by an FDA executive, bringing into question whether the program is truly paying off.

The orphan drug legislation was not only enacted in the US in 1983, but also in the EU in 2000. In the US, the changes brought on by the Orphan Drug Act made it successful and well-received by the rare disease community. 10 years before the Orphan Drug Act, only 10 orphan products were being sold on the US market. As of 2006, this number had increased to 1449 orphan drug products.⁸ Orphan drug legislation in the EU was similarly successful to the US in the first five years after it was introduced due to its three extra years of market exclusivity and co-payment protection programs, which seek to prevent ‘out-of-pocket’ spending after an individual exceeds their annual copayment amount.⁸ It is important to note that co-payment allowances, which are offered as financial assistance for patients who need prescription drugs, vary between the US and EU, and among the countries within the EU.⁸ In either case, the high cost and monopolization of orphan drugs may reduce patient accessibility to these drugs as designated orphan drugs cost more than non-designated ones, and therefore may be impossible to afford without insurance coverage. Thus, reimbursement and coverage is a key determinant in ensuring that patients can obtain orphan drugs like deflazacort.

It was the patients with Duchenne muscular dystrophy (DMD) and their families looking for new, cost effective treatments, who were most affected by this decision. Dana Edwards, a mother from New Jersey, had been importing deflazacort from abroad for her 12-year old son with DMD prior to 2017 for $1300 per year.⁷ Initially, Dana was relieved to discover that deflazacort would now be sold within the borders of the US, but the price tag came as a shock. She worried that the consumer price of deflazacort would increase to accommodate for the $180 million at which PTC Therapeutics purchased the drug from Marathon previously in March 2017, saying, “It’s all just insane. Honest to God, I think it’s going to have to remain pretty high. I pray to God that they do right by our community”.⁷ Although Marathon executives maintained that they would “create the opportunities needed” to ensure that DMD patients could afford the drug, the company nonetheless unethically profited from deflazacort’s inflated price before it was sold to PTC.⁷ In an effort to advocate for the rights of the rare disease community, Senator Bernie Sanders and Representative Elijah Cummings of the US government wrote a letter to Marathon demanding answers for the obscenely high price of this old drug, followed by another on March 17, 2017, to the FDA to repeat their concerns and draw more attention to the matter.⁷ In addition, an aide to Sen. Sanders confirmed that they would be conducting further investigation into the reason behind deflazacort’s new price and approval process. Not long before, seven democratic US senators and one independent had also written a letter to Marathon voicing their concern about the new list price of deflazacort and how it may be exploiting patients for profit.⁷ Marathon executives responded to the questioning and outrage by delaying the launch of deflazacort to the market. Shortly before October 2017, PTC Therapeutics announced that the drug would be sold at a reduced price of $46 000 per patient per year.⁹ Nevertheless, from this point forward, action must be taken to protect the rare disease community from exploitation by big corporations. The onus is put on PTC Therapeutics and the US government to place a cap on the market price of orphan drugs to inhibit price inflation of already-existing drugs like deflazacort and minimize barriers to patient accessibility of these drugs.

Kseniya Dybatch

Works Cited:

Yiu, Eppie M., and Andrew J. Kornberg. “Duchenne Muscular Dystrophy.” Journal of Paediatrics and Child Health, U.S. National Library of Medicine, 9 Mar. 2015, pubmed.ncbi.nlm.nih.gov/25752877/.

Duchenne muscular dystrophy. (n.d.). Retrieved February 11, 2021, from https://rarediseases.info.nih.gov/diseases/6291/duchenne-muscular-dystrophy

Tribble, Sarah J. “Are Golden Tickets That Speed Drugs Through FDA Worthwhile?” NPR, NPR, 29 Sept. 2016, www.npr.org/sections/health-shots/2016/09/29/495904450/are-golden-tickets-that-speed-drugs-through-fda-worthwhile.

Johnson, Carolyn Y. “An Old Drug Gets a New Price to Fight a Rare Disease: $89,000 a Year.” The Washington Post, WP Company, 29 Apr. 2019, www.washingtonpost.com/news/wonk/wp/2017/02/10/an-old-drug-gets-a-new-price-to-fight-a-rare-disease-89000-a-year/.

McMillan, Hugh J., and Craig Campbell. “We Need a ‘Made in Canada’ Orphan Drug Framework.” CMAJ : Canadian Medical Association Journal = Journal De L'Association Medicale Canadienne, Joule Inc., 16 Oct. 2017, www.ncbi.nlm.nih.gov/pmc/articles/PMC5647165/.

Gaffney, Alexander, et al. “Everything you need to know about FDA’s Priority Review Vouchers (RAPS Regulatory Explainer).” Kids v Cancer, 15 Aug. 2017, www.kidsvcancer.org/regulatory-explainer-everything-you-need-to-know-about-fdas-priority-review-vouchers/.

Tribble, Sarah J. “$89,000 Orphan Drug Gets A New Owner - And Likely A New Price.” Kaiser Health News, 21 Mar. 2017, khn.org/news/89000-orphan-drug-gets-a-new-owner-and-likely-a-new-price/.

Gammie, Todd, et al. “Access to Orphan Drugs: A Comprehensive Review of Legislations, Regulations and Policies in 35 Countries.” PloS One, Public Library of Science, 9 Oct. 2015, www.ncbi.nlm.nih.gov/pmc/articles/PMC4599885/.

Stewart, Janet. “Emflaza's New List Price Is $35K a Year, but Rises with Patient's Weight, PTC Announces.” Muscular Dystrophy News, 10 May 2017, musculardystrophynews.com/2017/05/09/emflaza-list-price-put-at-35000-by-ptc-on-weight-based-scale-reaction-swift/.

Cite This Article:

Dybatch K., Sritharan A., Guertin H., Vinokurtseva A., Chharawala, V. The Controversy Behind Deflazacort’s Orphan Drug Designation. Illustrated by D. Amin. Rare Disease Review. March 2021. DOI:10.13140/RG.2.2.16312.06403