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| Publications [#46173] of Henry G. Grabowski
Journal Articles
- H.G. Grabowski, Increasing R&D Incentives for Neglected Diseases: Lessons from the Orphan Drug Act,
in Cambridge University Press Conference Volume, edited by Jerome Reichman
(2005),
pp. 457-480 [PDF]
(last updated on 2008/02/05)
Abstract:
The U.S. Orphan Drug Act incorporates market
push
and pull incentives to encourage the
development of new
drugs for rare diseases. These include tax
credits and
grants, FDA counseling and encouragement, and
a market
exclusivity provision. The Act has been a
great success in
increasing the number of approved drugs for
rare diseases.
While new medicines for the neglected
diseases of poverty
are technically eligible for the incentives
embodied in the
Act, less than five percent of the orphan
drug marketing
approvals have been for such indications.
The basic
problem is insufficient expected revenues
associated with
the low ability to pay for health care in
poor countries.
There is the need for a strong market pull
mechanism
applicable to neglected diseases in poor
countries.
The focus of this paper is how to amend the
Orphan Drug Act
to include such a strong market pull
mechanism. Prior
authors have focused on transferable or
roaming exclusivity
rights and purchase funds as market pull
incentive
mechanisms. In this paper, the concept of a
transferable
right of priority review is developed as an
alternative to
transferable exclusivity rights.
Transferable rights of
priority review have advantages as a
decentralized market
incentive mechanism. In particular, they are
likely to be
more cost effective and acceptable
politically compared to
transferable exclusivity incentive programs.
Furthermore,
they could be designed to complement
government and private
donor purchase funds targeted to specific
conditions with
high disease burden such as malaria and
tuberculosis.
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