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Executive Summary

ORPHAN DRUG DEVELOPMENT OF SAME PRODUCT BY SEPARATE FIRMS is an issue which Rep. Waxman (D-Calif.) and Sen. Hatch (R-Utah) are expected to jointly address through legislation when Congress returns from its Labor Day recess on Sept. 8. Waxman is said to consider the duplicative development of orphan products a problem and to be interested in working with the Utah Republican on the issue. Hatch introduced a bill to amend the Orphan Drug Act just before Congress recessed. The measure (S 2772) would provide that more than one company may receive the seven-year market exclusivity period awarded for developing a product to treat a rare disease. The legislation stipulates that when two or more pharmaceutical firms simultaneously develop an orphan product, they each may receive the exclusive marketing period. The bill provides that an orphan drug is simultaneously developed when an NDA for the product is submitted to FDA before a previously submitted NDA is approved. Introducing S 2772 on the Senate floor, Hatch said that "in at least four existing cases . . . more than one company has undertaken the development, simultaneously, of an orphan drug product." If experience indicates that multiple companies may be willing to develop any given orphan product simultaneously, "we ought not to shut off the second or third company from taking the product to market by permitting only one company in that situation . . . sole exclusivity," the senator maintained. "Since public funds, through tax credits, are helping finance the simultaneous development of more than one source of an orphan drug, prudent use of public funds indicates that the public should enjoy the benefits of allowing more than one source" to market the product. Furthermore, he reasoned, "allowing more than one source where there is more than one company simultaneously developing the drug would further the purposes of the act by making more orphan drug products available." Hatch called simultaneous orphan drug development "commendable" because multiple sources can assure supplies and lead to lower prices and continued improvements through competition. Hatch explained that it occurs because the Orphan Drug Act "does not discourage" simultaneous development and, in fact, encourages it by providing more than one company tax credits and protocol assistance from FDA.

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