Orphan Drugs Market

The global Orphan Drugs Market is valued at USD 177 Billion in 2023 and is projected to reach a value of USD 505 Billion by 2032 at a CAGR (Compound Annual Growth Rate) of 12.4% between 2024 and 2032

Market Trends and Outlook

The Orphan Drugs market is experiencing significant growth driven by the increasing prevalence of rare diseases and advancements in medical research. Orphan Drugs are designed to address the needs of patients with rare disorders, for which few or no treatments are available. As of 2023, between 4,000 and 5,000 rare diseases remain without effective treatments, affecting approximately 25 to 30 million people in Europe alone. This substantial unmet medical need is driving the demand for Orphan Drugs, as pharmaceutical companies and biopharmaceutical firms strive to develop therapies for these conditions. To date, approximately 6,000 to 8,000 distinct rare diseases have been identified, with 80% being genetic and 50%-75% beginning in childhood. Although orphan diseases are classified as rare, the total number of individuals affected by these conditions is substantial. According to the National Institutes of Health, 25% of rare disease patients experience multiple misdiagnoses, leading to ineffective treatment. In the US, patients often see eight doctors and receive two to three incorrect diagnoses. The growing incidence of rare diseases and the demand for accurate treatment solutions are creating significant opportunities in the market for companies globally.

Technological innovations, such as gene editing & artificial intelligence in drug discovery, are enhancing the precision and efficiency of orphan drug development. The approval of over 50% of the US FDA's Center for Drug Evaluation and Research (CDER) designations for Orphan Drugs in recent years reflects this progress. The emergence of new technologies and a robust pipeline of Orphan Drugs are contributing to the market's expansion.

Industry Highlights

• In 2023, North America dominated the market with a 54.2% revenue share, driven by the healthcare infrastructure and favorable regulatory environment
• Europe is anticipated to experience fastest growth due to the rising patient population and the increasing use of advanced treatments for rare diseases
• The Oncology segment dominated the market with a revenue share of 47.5% in 2023 because of the strong regulatory approvals
• Based on Distribution Channel, the Hospital Pharmacy segment accounted 42.1% of revenue share in 2023 due to its dominance in administering a large volume of intravenous drugs by trained healthcare professionals
• According to the Orphan Drug Report 2022 by Evaluate Pharma, the top 10 orphan drug blockbusters are projected to generate between USD 3.0 billion and USD 13 billion by 2026
• It is also anticipated that 40% of Johnson & Johnson’s pharmaceutical sales will come from Orphan Drugs, particularly blood cancer treatments like Imbruvica and Darzalex, which are expected to exceed USD 23.0 billion by 2026

Approved Drugs Under the Orphan Drug Act

1. matinib (Gleevec): Imatinib, commonly known by its trade name Gleevec, is an Orphan Drugs approved for the treatment of various cancers, including chronic myeloid leukemia (CML) and gastrointestinal stromal tumors (GISTs). It was originally approved in 2001 for CML, with subsequent approvals for other indications, demonstrating significant therapeutic gains for patients with these rare conditions. The drug showcases the effectiveness of the Orphan Drug Act in incentivizing the development of medications targeting rare cancers, which has impacted many lives positively.
2. Eculizumab (Soliris): Eculizumab, marketed as Soliris, is an Orphan Drugs used to treat conditions such as paroxysmal nocturnal hemoglobinuria (PNH) and atypical hemolytic uremic syndrome (aHUS). It received its Orphan Drugs designation and subsequent approval in the US in 2007. Eculizumab represents a major advancement in treating these rare and life-threatening disorders, highlighting the commitment of the Orphan Drug Act to promote innovative therapies for diseases with significant unmet needs.
3. Pulmozyme (Dornase alfa): Pulmozyme, or dornase alfa, is an enzyme therapy used in the management of cystic fibrosis, a genetic disease that affects the lungs & digestive system. Approved as an orphan drug in 1993, Pulmozyme helps to reduce mucus viscosity in the lungs, improving respiratory function and quality of life for patients. Its approval underscores the Orphan Drug Act's success in facilitating the development of treatments for chronic conditions with low patient populations.
4. Trulicity (Dulaglutide): Dulaglutide, marketed as Trulicity, is a medication approved for the treatment of Type 2 diabetes, but it also received Orphan Drugs designation for use in treating pediatric patients with type 2 diabetes. This approval highlights the Orphan Drug Act's ability to extend benefits to rare conditions that can occur in specific stratification of patient populations, exemplifying how the Act aids in supporting drug development across varied demographics.
5. Vimizim (Elosulfase alfa): Elosulfase alfa, branded as Vimizim, was approved for the treatment of mucopolysaccharidosis type IVA (Morquio A syndrome) in 2014. This rare genetic disorder can lead to various debilitating health issues, and Vimizim represents a significant therapeutic option for patients. Its approval illustrates how government incentives through the Orphan Drug Act can encourage the development of vital medicines for rare diseases.

Market Dynamics

Growing R&D Initiatives to Fuel the Market Growth

A key factor driving growth in the global market is the rising investment in research & development by major players aimed at creating innovative products. As awareness and understanding of rare diseases have expanded, numerous leading biopharmaceutical companies and established market players are advancing their pipelines with orphan drug candidates at various clinical trial stages. This push into rare disease therapeutics is driven by the potential for significant pharmaceutical breakthroughs and blockbuster drugs, which are often more achievable in rare disorders compared to traditional drug portfolios. For instance, in 2023, over half of the FDA’s Center for Drug Evaluation and Research (CDER) approvals were for Orphan Drugs, and two CAR-T cell therapies received approval from the Center for Biologics Evaluation and Research (CBER). Additionally, some governments are promoting research and innovation initiatives to boost this sector.

The government initiatives are supporting research and innovation in this sector. In July 2021, Novartis announced that the FDA granted Orphan Drug Designation (ODD) to NIS793, in combination with standard chemotherapy, for treating pancreatic cancer. NIS793 is a potential first-in-class antibody targeting Transforming Growth Factor Beta (TGFβ), which plays a significant role in metastatic pancreatic ductal carcinoma (mPDAC) and other solid tumors.

Rising Rare Disease Prevalence and Increasing Demand for Orphan Drugs Drives the Market Growth

With approximately 7,000 recognized rare diseases affecting around 400 million people globally, there exists a substantial unmet medical need for effective treatments. As more patients seek answers for their conditions, pharmaceutical companies are motivated to develop Orphan Drugs that can meet these unique health challenges. For example, the medication Evorpacept has been formulated to treat Acute Myeloid Leukemia, representing one of the many promising advancements in orphan drug therapies that cater to specific patient populations impacted by rare ailments.

Key Trends

1. The market is driven by substantial investments in research & development. Companies and researchers are increasingly focusing on identifying and developing treatments for rare diseases, spurred by the potential for high returns on investments due to the lucrative nature of Orphan Drugs pricing and market exclusivity.
2. Within the market, the neurology segment is likely to witness the highest growth rate over the forecast period. This trend is attributed to the increasing prevalence of rare neurological disorders and the need for effective treatments that address these conditions.
3. Technological advancements in biotechnology are reshaping the overall market. Innovations such as gene editing, artificial intelligence in drug discovery, and advances in drug delivery systems are enhancing the efficiency & effectiveness of Orphan Drugs development. Such technologies are not only improving the precision of treatments but also accelerating the research & development process, thus contributing to the overall market growth.
4. The growing awareness & advocacy for rare diseases have significantly impacted the global market. Patient advocacy groups and increased public awareness are driving demand for new treatments, influencing both market dynamics and regulatory policies. Pharmaceutical companies are responding to this demand by prioritizing the development of Orphan Drugs.

Therapy Type Overview

The Oncology category captures 47.5% revenue share in 2023 due to strong regulatory approvals. In 2023, the oncology segment held the largest share of the global market. This dominance is attributed to the numerous oncology drugs in development pipelines and the significant number of Orphan Drugs targeting various cancers. For example, in February 2022, CTI BioPharma received FDA approval for Pacritinib, a drug for treating adult patients with myelofibrosis, a rare bone cancer affecting over 21,000 individuals in the US.

The hematology segment is expected to be the second most dominant because of the numerous new product launches and an increasing number of regulatory approvals. The neurology segment is also projected to show a relatively strong compound annual growth rate (CAGR) due to advancements in treatments for chronic conditions like multiple sclerosis.

In contrast, the respiratory, endocrinology, and cardiovascular segments are anticipated to experience lower growth rate during the forecast period. The immunotherapy segment is expected to achieve a strong CAGR, supported by effective products such as Keytruda and increased research initiatives.

Regional Overview

North America dominated the market with a 54.2% revenue share in 2023 driven by favorable regulatory environment. The region is characterized by a robust healthcare infrastructure and a favorable regulatory environment, particularly influenced by the Orphan Drug Act of 1983, which has incentivized the development of treatments for rare diseases through extended market exclusivity and tax credits. The US comprises the largest share of the market, with over 300 clinical trials dedicated to Orphan Drugs, addressing the needs of approximately 200,000 patients requiring these therapies.

The regional market is further propelled by rising investments in research & development, coupled with an increasing prevalence of rare diseases linked to lifestyle changes. Additionally, governmental initiatives aimed at enhancing patient access to specialized treatments are fostering growth in this sector. However, challenges such as a shortage of skilled manufacturing professionals, price fluctuations due to raw material scarcity, and stringent regulatory approvals continue to pose risks to market dynamics.

The Genetic and Rare Diseases (GARD) Information Center reports that over 10,000 rare diseases exist in the US, affecting approximately 1 in 10 people, or around 30 million individuals. This, combined with favorable reimbursement policies in the US, contributes to North America's leading position in the global market. Moreover, in December 2023, BioVersys AG received Orphan Drug Designation (ODD) from the US Food and Drug Administration for alpibectir (BVLGSK098) and its fixed-dose combination with ethionamide, intended for the treatment of tuberculosis (TB).

The European market is expected to register a strong growth rate due to the increasing patient population and strong adoption of sophisticated rare disease therapeutics. The European market benefits from a unique regulatory framework that provides approximately ten years of marketing exclusivity from the date of approval for Orphan Drugs, which encourages pharmaceutical companies to invest in this niche sector. The variety in disease prevalence benchmarks across countries, particularly the definition of rare diseases being those affecting fewer than 10,000 people, also influences market growth and research priorities in the region.

The growth of the European market is enhanced by increased focus on chronic and infectious diseases, compelling both public and private organizations to prioritize research and development of orphan therapies4. Factors such as escalating healthcare expenditures, advancements in drug manufacturing technologies, and collaborations between entities in the US and Europe have further strengthened market prospects.

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Competitive Outlook

The market is highly competitive due to the availability of large number of major players and their varied product development pipelines. As of 2023, F. Hoffmann-La Roche Ltd. and Bristol-Myers Squibb Company are leading the market, capturing a significant portion of the global share, mainly due to their robust portfolios of oncology drugs. However, other prominent players like Biogen Inc., with their innovative pipelines targeting various rare diseases, are gaining traction in the industry. In addition, companies within the global Orphan Drugs sector are actively introducing new treatments. For instance, in March 2022, Marinus Pharmaceuticals received US FDA approval for TALMY (ganaxolone), designed to treat seizures associated with the rare cyclin-dependent kinase-like 5 (CDKL5) deficiency disorder (CDD) in patients aged two and older.

Market Developments

Novo Nordisk Receives FDA Approval for Rivfloza (Nedosiran) to Treat Primary Hyperoxaluria Type 1

• In October 2023, Novo Nordisk has revealed that the US Food and Drug Administration (FDA) has granted approval for RivflozaTM (nedosiran) injection in 80 mg, 128 mg, and 160 mg doses. This once-monthly subcutaneous ribonucleic acid interference (RNAi) therapy is intended to reduce urinary oxalate levels in both children aged 9 and older and adults with primary hyperoxaluria type 1 (PH1) who have relatively preserved kidney function.

Amgen Completes $27.8 Billion Acquisition of Horizon Therapeutics

• In October 2023, Amgen has announced the completion of its acquisition of Horizon Therapeutics plc, paying $116.50 per share in cash. The total transaction equity value is approximately $27.8 billion.

GSK's Benlysta Awarded Orphan Drugs Designation for Systemic Sclerosis Treatment

• In February 2023, GSK plc has announced that the US Food and Drug Administration (FDA) has awarded Orphan Drugs Designation (ODD) to Benlysta (belimumab), a B-cell inhibiting monoclonal antibody, for its potential use in treating systemic sclerosis. GSK intends to start a phase II/III trial of belimumab for systemic sclerosis-related interstitial lung disease (SSc-ILD) in the first half of 2023.

AskBio's AB-1003 Granted Orphan Drugs Status by European Commission for Limb-Girdle Muscular Dystrophy

• In February 2023, Asklepios BioPharmaceutical, Inc. (AskBio), a wholly owned subsidiary of Bayer AG, has announced that the European Commission (EC) has granted Orphan Drugs designation to AB-1003 (also known as LION-101) for the treatment of limb-girdle muscular dystrophy (LGMD). AB-1003 is an investigational gene therapy using recombinant adeno-associated virus (AAV) technology, designed for a one-time intravenous (IV) infusion. It targets LGMD type 2I/R9, a rare disease subtype affecting 4.5 people per million globally, including over 5,000 individuals in the EU and US.

Alexion Finalizes Acquisition of LogicBio® Therapeutics to Advance Genomic Medicine

• In November 2022, Alexion, AstraZeneca Rare Disease, has announced the successful completion of its acquisition of LogicBio® Therapeutics, Inc., an innovative genomic medicine company. This acquisition provides Alexion with the chance to enhance its growth in genomic medicines by leveraging LogicBio’s unique technology, experienced rare disease R&D team, and expertise in pre-clinical development.

AstraZeneca India Launches Rare Disease Therapy with Regulatory Approval of Selumetinib

• In February 2022, AstraZeneca India, a science-driven biopharmaceutical firm, has announced its expansion into rare disease therapy in India. The regulatory approval of 'Selumetinib' highlights the company's dedication to introducing cutting-edge, science-based treatments to Indian patients. With this addition, AstraZeneca aims to address the significant unmet needs of individuals with rare diseases and improve their quality of life.

The global Orphan Drugs market can be categorized as Therapy Type, Drug Type, Distribution Channel, and Region.

Frequently Asked Questions (FAQ’s)?

1.What are Orphan Drugs?

​Orphan Drugs are medicines specifically designed to treat, prevent, or diagnose rare diseases. These diseases are often termed "orphan diseases," as they affect a relatively small population, which may discourage pharmaceutical companies from developing treatments due to limited profitability.

2. How big is the Orphan Drugs market?

The market was valued at USD 177 billion in 2023 and is projected to grow to approximately USD 505 billion by 2032, with a compound annual growth rate (CAGR) of 12.4% from 2024 to 2032.

3. What is the Orphan Drugs Program?

The Orphan Drugs Designation program grants orphan status to drugs and biologics designed for rare diseases that meet specific criteria. This designation offers various incentives, including tax credits for eligible clinical trials.

5. What is the Orphan Drugs Act?

The Orphan Drugs Act, enacted by Congress in 1983, encourages the development of drugs for treating rare diseases through various incentives.

6. What is the first approved Orphan Drugs?

The Food and Drug Administration (FDA) has granted initial marketing approval to Panhematin as an Orphan Drugs for treating acute intermittent porphyria and other acute porphyrias.

7. What are the new Orphan Drugs?

New FDA Orphan Drugs: CDX-110, ATryn, ISIS 333611. The FDA has awarded Orphan Drugs designation to CDX-110 for glioblastoma multiforme, ATryn for hereditary antithrombin deficiency, and ISIS 333611 for amyotrophic lateral sclerosis.

8. What are Orphan Drugs examples?

Examples of Orphan Drugs include:

• Ivacaftor: A therapy for cystic fibrosis, a genetic disorder impacting breathing and digestion, affecting around 30,000 Americans.
• Alglucerase: A treatment for Gaucher disease, which causes pain and tissue damage in the liver, spleen, lungs, and bone marrow.