Soligenix, Inc. (OTCQB: SNGX), a development stage biopharmaceutical company, recently announced that the Office of Orphan Products Development of the US Food and Drug Administration (FDA) has granted orphan drug designation to OrbeShield™ (oral beclomethasone 17,21-dipropionate or oral BDP), which is for the prevention of death following a potentially lethal dose of total body irradiation during or after a radiation disaster.
Oral BDP is a highly potent, topically active corticosteroid that has a local effect on inflamed tissue. BDP is the active ingredient in OrbeShield™, currently being developed for the treatment of gastrointestinal acute radiation syndrome (GI ARS), the driving component in early mortality following high doses of total body irradiation (TBI).
The orphan drug designation is intended to assist and encourage companies to develop safe and effective therapies for the treatment of rare diseases and disorders. Indeed, there is no greater example of the incentive power of patents and their exclusive rights than illustrated by the Orphan Drug Act. After passage of the Orphan Drug Act there was a 1300% increase in the number of treatments for rare diseases (which are generally defined as diseases affecting fewer than 200,000 people).
In enacting the Orphan Drug Act in 1983, Congress sought to manipulate by use of a carrot — incentivizing the creation of treatments that otherwise would have a market too small to pursue. By offering exclusive rights for a limited time far more drugs and treatments have been created to treat rare diseases than otherwise would have been created.
According to attorneys Eric Mirabel and Suzannah Sundby:
The term “Orphan Disease” is often used to refer to a rare disease because of the lack of available treatments and medicines. The lack of available treatments and medicines for such Orphan Diseases is the result of the fact that only a small percentage of the population is afflicted and, as such, companies (without government incentives) are unlikely able to recoup the costs of bringing the treatments and medicines to the public and keeping them available to the public. Many Orphan Diseases have known etiologies and known treatments, but the drugs and medicines are not available to the public because of the costs involved in the FDA approval process and commercialization.
Thus, Congress enacted the 1983 Orphan Drug Act which provides various incentives, including exclusivity periods and monetary incentives in the form of grants and discounts on various FDA approval and user fees. Because of these incentives, companies have found it economically viable to risk millions of dollars in R&D with the hope of bringing treatments, medicines, and even cures to small populations afflicted with a rare disease.
Indeed, within the Orphan Drug Act are the following six findings made by Congress:
- there are many diseases and conditions, such as Huntington’s disease, myoclonus, ALS (Lou Gehrig’s disease), Tourette syndrome, and muscular dystrophy which affect such small numbers of individuals residing in the United States that the diseases and conditions are considered rare in the United States;
- adequate drugs for many of such diseases and conditions have not been developed;
- drugs for these diseases and conditions are commonly referred to as “orphan drugs”;
- because so few individuals are affected by any one rare disease or condition, a pharmaceutical company which develops an orphan drug may reasonably expect the drug to generate relatively small sales in comparison to the cost of developing the drug and consequently to incur a financial loss;
- there is reason to believe that some promising orphan drugs will not be developed unless changes are made in the applicable Federal laws to reduce the costs of developing such drugs and to provide financial incentives to develop such drugs; and
- it is in the public interest to provide such changes and incentives for the development of orphan drugs.
In addition to providing a seven-year term of market exclusivity for oral BDP upon final FDA approval, orphan drug designation also positions Soligenix to be able to leverage a wide range of financial and regulatory benefits, including government grants for conducting clinical trials, waiver of expensive FDA user fees for the potential submission of a New Drug Application for oral BDP, and certain tax credits.
“The FDA’s decision to grant oral BDP orphan drug designation signifies an important step for Soligenix as we continue to expand our oral BDP pipeline,” stated Christopher J. Schaber , PhD, President & Chief Executive Officer of Soligenix. “The marketing exclusivity that orphan drug designation imparts adds significantly to the existing patent estate surrounding OrbeShield™. We believe that OrbeShield™ has the potential to be a significant advancement in the preparation necessary for this nation to manage a public health emergency like a nuclear attack.”
In this case, orphan designation was provided in a situation where presently there are few occurrences of the disease/illness, but we can envision a doomsday scenario whereby it would be more widely necessary.