The Food and Drug Administration has the authority to designate drugs as “orphan products,” which aim to treat patients with rare diseases, but also can be approved to treat common diseases. For instance, Prozac, has an “orphan product” designation to be used in treating autism and body dysmorphic disorders in children and adolescents, but also is commonly used to treat depression.
Access to orphan-designated products by vulnerable patient populations, whether for orphan indications or not, is facilitated by the federal 340B program that requires pharmaceutical manufacturers to provide these outpatient drugs at heavily discounted prices to hospitals and clinics that treat poor and underserved populations.
In a new commentary, Tony Yang, associate professor of health administration and policy, and Brian Chen and Charles L. Bennett of the University of South Carolina, explore the October 2015 federal ruling that allowed certain hospital entities in the 340B Drug Pricing Program to purchase orphan drugs at discounted prices even for a non-orphan use. The commentary is published in a leading medical journal, the Journal of Clinical Oncology (JCO).
The authors examine the competing policy considerations of the decision and how the decision could result in higher acquisition costs of orphan-designated products for these entities and could lead to further lawsuits challenging the recently proposed Guidance as inconsistent with the 340B statute, jeopardizing reforms of the 340B program. The authors believe Congress needs to provide further legislative clarification to allow the U.S. Department of Health and Human Services to interpret the 340B Program and address other issues of contention between 340B Program entities and pharmaceutical companies. Read the full commentary.