Orphan Drug Status Plays into Drug Pricing

Orphan drugs, treatments for rare diseases with limited therapeutic options, are usually less profitable for pharma companies due to high development costs and small patient populations. However, orphan drug designation (ODD) offers monetary incentives to companies developing drugs for rare diseases. As a result, ODD plays a role in pharma drug pricing decision-making.

According to Emma Davies, “One company taking advantage of Orphan Drug Designation is Dimerix (ASX:DXB) in its Phase 3 clinical trial in Focal Segmental Glomerulosclerosis, a rare disease of the kidneys which affects children as young as two years old, as well as adults. It causes inflammation and irreversible scarring, leading to permanent kidney damage and eventual end-stage kidney failure requiring dialysis or transplantation.”

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(Source: Stockhead, May 21^st, 2023)