Are Drug Companies Exploiting the Orphan Drug Act? Of Course They Are

According to a story from, one pharmaceutical company is taking advantage of a little known loophole in the Orphan Drug Act to suppress competition and rake in gluttonous profits. Overall, the record of the Orphan Drug Act has been a successful one. The law provides useful incentives that have been successful in encouraging drug companies to invest much more of their time and money into developing treatments for rare diseases than they otherwise would have. Unfortunately, there are always unscrupulous players who seek to manipulate the law in their favor.

Rigging The System

A company called Indivior was able to earn Orphan Drug Designation for the drug Subutex in 1994. Subutex is a formulation of buprenorphine, a drug that is used to treat opioid addiction. Opioid addiction isn’t rare (and is in fact far more widespread now than in 1994), but the company was able to convince the US Food and Drug Administration (FDA) to award the designation after presenting data which suggested that Subutex wouldn’t be profitable enough to cover its development. 

Fast forward now to 2011. This year, the company decided to stop marketing Subutex. Then, in 2017, the company’s new formulation of the drug, called Sublocade, was approved by the FDA. It is here that the loophole comes into play: a new formulation of a drug that was granted Orphan Drug Designation is automatically given the designation as well as long as it is demonstrably superior to earlier formulations. Additionally, the company doesn’t have to indicate that the new formulation won’t be profitable. 

So now we have a company with a seven year exclusive stranglehold on the market in an area of medical treatment thanks to a loophole in a law that is intended for rare disease drugs. Millions of Americans are addicted to opioids; it is far from a rare problem. The opioid crisis is a major driver of declining life expectancy in the country as well. 

Indivior has been doing quite well with these opioid-addiction drugs as a result, raking in $10 billion since Subutex’s first approval in 1994. Now the company stands to benefit from Orphan Drug designation for a drug that treats a problem that not only is all-too-common, but is also all-too-deadly. Not to mention this discourages the development and approval of alternatives, even though there are effective alternatives available. The pharma company Braeburn, for example, recently filed a petition to revoke the designation for Sublocade so that its own drug would have a chance.

In a time where opioid addiction and overdose is a major public health crisis, the FDA should make the decision to revoke Orphan Drug Designation for Sublocade, which currently flies in the face of the original spirit of the Orphan Drug Act. This law should help new therapies be developed and approved for rare diseases, not facilitate market exclusives for common and dangerous health problems.

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