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Why the underestimated economic burden of rare diseases could be costing the U.S. trillions of dollars

Why the underestimated economic burden of rare diseases could be costing the U.S. trillions of dollars

Rare diseases have gained more attention in recent years, perhaps in part due to the high price tags often associated with approved therapies. But the cost of rare disease drugs is dwarfed by the cost of not having them.

Our recent study shows that a lack of treatment for a rare disease is associated with a 21.2% increase in total costs per patient per year. That places a significant burden on the healthcare system. While rare diseases impact a small population, the cost to society is staggering–we estimate that the societal cost in the U.S. for all 7,000 known rare diseases may be in the range of $7.2-$8.6 trillion per year.

Historically, there has been a lack of shared responsibility for alleviating the burden of rare diseases by different stakeholders, including industry, government bodies, policymakers, and society. But a societal approach is essential to address this growing public health crisis and will need to include improved healthcare policies. The good news is that the substantial economic burden that rare diseases impose can be reduced by treatment availability, and pharma and biotech companies are increasingly focusing on rare disease populations. Policymakers may be interested to know that based on the study, productivity-related economic losses dropped from about $61,000 for both patients and caregivers when no treatment was available to about $22,000 for patients and $5,000 for caregivers with treatment.

These and future economic data can help justify increased government investment to ensure broader patient access to safe and effective therapies and policy proposals that reflect the unique challenges in the rare disease community. And it seems that government leaders are listening. Existing U.S. policy incentivizes rare disease R&D, and new bills introduced to Congress will help further drive rare disease drug development by, for example, restoring the Orphan Drug Tax Credit from 25% to its original 50% and extending exclusivity for rare disease clinical trials stalled during the pandemic. In addition, the bipartisan bicameral BENEFIT Act would allow patients and advocates to play a larger role in the FDA’s benefit-risk framework for drug approvals.

Regulators are hearing the calls to action as well. According to remarks from Peter Marks, director of the FDA’s Center for Biologics Evaluation and Research (CBER), the agency is preparing a pilot program to encourage the development of new drugs for rare diseases,…

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