Orphan Medicinal Products

 

Anna Ivanova, Associate at BRACE Law Firm

May 8, 2022

 

According to Articles 4 and 44 of Federal Law No. 61-FZ dated April 12, 2010, On Circulation of Medicinal Products (the "Law No. 61-FZ" or the "Law on Circulation of Medicinal Products"), orphan medicinal products are medicinal products intended exclusively for the diagnosis or pathogenetic treatment (treatment directed at the mechanism of disease development) of rare (orphan) diseases.

Rare (orphan) diseases are defined as diseases with a prevalence of no more than 10 cases per 100,000 population. The Ministry of Health of Russia forms the list of rare (orphan) diseases based on statistical data, which is currently available on its official website. Government Decree No. 403 dated April 26, 2012, On the Procedure for Maintaining the Federal Register of Persons Suffering from Life-Threatening and Chronic Progressive Rare (Orphan) Diseases Leading to a Reduction in Life Expectancy or Disability and Its Regional Segment, approved a list of such diseases derived from the general orphan disease list.

It is important to note that the Law on Circulation of Medicinal Products identifies prevalence of no more than 10 cases per 100,000 population as the primary criterion for an orphan disease. In contrast, in the EU, for example, it is also essential that the orphan drug be intended for patients with a disease for which no officially recognized satisfactory methods of diagnosis, prevention, or treatment exist. If a treatment already exists, the applicant must prove that the new product offers significant clinical benefits compared to the existing orphan drug. Furthermore, in several foreign countries, a drug may be recognized as an orphan medicinal product if the development costs exceed the potential revenue from its market launch.

In Singapore, any medicinal product identified by a physician or dentist for treating an orphan disease in the absence of an effective substitute is recognized as an orphan drug. In this case, the product imported from other countries must have approval from a competent health authority and may not be licensed [1].

Thus, Russian legislation views the concept of an orphan drug much more narrowly than foreign legal systems, limiting it to products for the treatment and diagnosis of rare diseases (whereas the EU, for instance, includes diagnosis, treatment, and prevention). Moreover, the treatment must be linked to the mechanism of disease development, which many physicians consider an unjustified restriction.

Within the EAEU legal framework, the definition of an orphan medicinal product was further specified. The EEC defined an orphan (rare) medicinal product as a medicinal product intended for the diagnosis, etiopathogenetic, or pathogenetic treatment (treatment directed at the mechanism of disease development) of rare (orphan) diseases, the frequency of which does not exceed the officially determined level in a member state [2].

According to statistical data, approximately 16,000 people in Russia suffer from orphan diseases [3]. Because these diseases are rare, several specific features arise regarding the medicinal provision for these patients. On one hand, a relatively small number of patients require orphan medicinal products; on the other hand, such drugs have their own specific characteristics, are often expensive, and are sometimes impossible to replace with drugs freely circulating on the pharmaceutical market.

This article examines the specifics of legal regulation regarding the treatment of orphan diseases and the circulation of orphan medicinal products.

Orphan Diseases: Legal Regulation

The term "orphan diseases" ("rare diseases", "orphan illnesses") first appeared in 1983 in the United States with the adoption of the Orphan Drug Act. These include diseases such as phenylketonuria, cystic fibrosis, multiple myeloma, chronic myeloid leukemia, Gaucher disease, glioma, and others. Today, the concept of orphan diseases is enshrined in the laws of many countries, including Australia, Japan, and Singapore. In 1999, the European Parliament adopted a law similar to the American act [4].

As a general rule, Part 4 of Article 83 of Federal Law No. 323-FZ dated November 21, 2011, On the Fundamentals of Health Protection of Citizens in the Russian Federation (the "Law No. 323-FZ" or the "Law on the Fundamentals of Health Protection") provides that regional budgets of the Russian Federation shall fund the provision of registered medicinal products to citizens for the treatment of diseases included in the list of life-threatening and chronic progressive rare (orphan) diseases leading to a reduction in life expectancy or disability.

According to Article 29 of the Law on the Fundamentals of Health Protection, health protection is organized by providing first aid and all types of medical care, including to citizens suffering from socially significant diseases, diseases posing a danger to others, and rare (orphan) diseases.

Furthermore, for the period of 2021–2030, the government envisages a fundamental study of the chemical nature of living organisms as the basis for developing medicinal products and treatments for incurable and socially significant diseases. It is anticipated that creating new drugs for early diagnosis and treatment of oncological, severe viral, autoimmune, and orphan diseases will be of vital importance in the near future [5].

Additionally, in May 2021, Russia adopted the Rules for Providing Medical Care (if necessary, outside the Russian Federation) to a Specific Child with a Severe Life-Threatening or Chronic Disease, Including a Rare (Orphan) Disease, or Groups of Such Children. These Rules establish that the Expert Council of the Foundation for Support of Children with Severe Life-Threatening and Chronic Diseases, Including Rare (Orphan) Diseases, "Circle of Kindness" (the "Circle of Kindness" or the "Foundation"), determines the provision of medical care to a specific child with an orphan disease. This decision requires a copy of the discharge summary from the inpatient medical records provided by the medical organization where the child was referred, specifying health status (primary and secondary diagnoses, anamnesis, test results, and treatment provided) and recommendations for complex medical care [6]. The Ministry of Health of Russia provides corresponding grants to the Circle of Kindness to fund medical care (including care outside Russia); provision of medicinal products and/or medical devices, including those not registered in the Russian Federation; and provision of technical rehabilitation means for children with severe diseases [7].

In effect, active legislative work is currently underway to adopt measures for treating orphan diseases. Particular attention is paid to the treatment of children. The circulation of orphan medicinal products involves unique characteristics, including specific registration and expertise procedures.

Expertise and State Registration of Orphan Medicinal Products

According to Articles 13 and 18 of the Law on Circulation of Medicinal Products, the results of an expertise determine the state registration of medicinal products. For orphan medicinal products, state registration follows an expertise of documents submitted to determine whether the product qualifies as an orphan drug, as well as a quality expertise. To this end, an applicant must submit an application for state registration of the medicinal product to Roszdravnadzor. This application must specify the need for an expertise of documents to classify the drug as an orphan product and include copies of documents confirming payment of the state duty for such expertise.

Registration also requires the submission of clinical documentation in the scope established by the authorized federal executive body. Order of the Ministry of Health of Russia No. 930n dated December 15, 2015, defines this scope, which includes reports on bioavailability studies; studies establishing correlation between in vitro and in vivo results; pharmacokinetic study reports; pharmacodynamic study reports; and clinical study reports on efficacy and safety.

Notably, if it is impossible to submit reports on clinical studies of an orphan medicinal product conducted in Russia, or international clinical studies partially conducted in Russia, an applicant may submit reports on clinical studies conducted abroad. These reports must include the information listed above [8].

Within 10 business days from the receipt of the registration application, the authorized body decides whether to issue an assignment for the expertise of documents submitted to determine if the product qualifies as an orphan medicinal product. Upon receiving the expertise conclusion, Roszdravnadzor has 5 business days to decide whether to issue an assignment for the quality expertise of the medicinal product or to terminate the registration process.

If the expertise confirms the drug's orphan status based on clinical studies conducted outside Russia, the clinical documentation section may include reports from foreign clinical studies instead of Russian ones. These studies must comply with Good Laboratory Practice (GLP) and Good Clinical Practice (GCP) rules.

The law also requires the Marketing Authorization Holder (MAH) of an orphan medicinal product to provide reference medicinal product samples to applicants for clinical studies on a commercial basis. The cost of such samples, if included in the VED List, must not exceed the registered maximum selling price or the price in the manufacturer's country. Generally, an application for state registration of a generic medicinal product cannot be submitted until four years have passed from the date of state registration of the reference medicinal product. Because of the fast-track expertise procedure for generic medicinal products, pharmaceutical companies are highly interested in obtaining these samples. However, MAH holders of reference drugs are not always willing to share them. The fast-track expertise procedure for the state registration of orphan medicinal products applies to the first three generic medicinal products registered in Russia. Many pharmaceutical law specialists have repeatedly raised the issue of the relationship between the obligation to transfer registration data and patent law. Specifically, under Article 1358 of the Civil Code, the patent holder has the exclusive right to use the invention in any manner not prohibited by law. Thus, the question of transferring registration data for drugs protected by patents remains open. The conflict between the two legal protection systems is particularly acute for medicinal products because the registration and release into civil circulation of generics can occur long before the expiration of the exclusive right to the reference (original) medicinal product [9].

Following the quality expertise of the orphan medicinal product, a decision is made to grant or deny registration. Upon registration, the product is included in the State Register of Medicinal Products, specifying the date the decision was made to treat the product as an orphan drug.

Preferences for Orphan Medicinal Products

The primary preference for orphan medicinal products in Russia is the fast-track expertise procedure. According to Article 26 of Law No. 61-FZ, the fast-track expertise procedure must not exceed 80 business days. The expertise of documents in the registration dossier is conducted within 10 business days, while the quality expertise and the benefit-risk balance assessment are conducted within 60 business days.

As previously noted, results of preclinical and clinical studies conducted outside the Russian Federation in accordance with GLP and GCP rules may be submitted for orphan medicinal products.

According to EAEU legislation, when registering a medicinal product in a reference state, the applicant is not required to provide samples, specific reagents, or other materials if the expertise organization cannot conduct tests due to the unavailability of samples (including their classification as orphan drugs), the inability to maintain transport or storage conditions in the member state, or the lack of specialized equipment. For medicinal products not recognized as orphan drugs in a particular member state, the date of registration confirmation (re-registration) is determined by the date of registration in that member state under the mutual recognition procedure.

The applicant must justify in the preclinical and clinical summaries why complete information cannot be provided and present a justification for the benefit-risk balance of the orphan drugs in question.

Foreign countries provide a greater number of preferences for the circulation of orphan medicinal products. Global practice has developed several key directions to stimulate orphan drug development: providing tax incentives to developers; targeted state funding for R&D; granting domestic manufacturers preferential rights to supply orphan drugs for state needs; and assisting domestic manufacturers with export potential in launching orphan drugs in other countries [10].

In Japan, for example, obtaining orphan status entitles the manufacturer to a 50% reimbursement of development costs, a 6% tax reduction, and other financial benefits. In the US, the FDA provides technical assistance with orphan drug applications, potential reductions in waiting periods, and waivers for registration fees. Orphan status also offers a 50% tax credit for clinical trial costs [11].

However, preferences do not always yield positive results. One problem in the US is that pharmaceutical companies, after using all preferences to launch orphan drugs, subsequently market them for broad use. In 2020, the US passed the Ensuring Innovation Act to prevent the restriction of innovative treatments for opioid use disorders. Previously, to obtain orphan status, a drug had to treat a disease affecting fewer than 200,000 Americans. However, the law also granted benefits to drugs for larger populations if the company could not recover R&D costs through US sales. New rules require manufacturers of drugs for more than 200,000 people to prove they cannot recover R&D costs through sales before receiving preferences [12].

This leads to the conclusion that developed countries take special measures to stimulate the orphan drug market, including: exclusive sales rights for a specific period; tax incentives and development subsidies; simplified regulatory procedures, including fast-track documentation approval; and assistance in preparing documentation [13].

In our opinion, the primary deficiency in Russia's existing preferences for orphan drugs is the lack of tax incentives. Since January 1, 2021, annual incomes exceeding 5,000,000 rubles are taxed at a 15% rate. President Vladimir Putin proposed directing the proceeds from this tax increase toward treating children with orphan diseases [14]. Nevertheless, drug manufacturers themselves do not enjoy preferences equal to those in Western countries. We believe these issues require further refinement through legislative initiatives.

Provision of Orphan Medicinal Products to Patients

According to Part 4 of Article 44 of Law No. 323-FZ, the Federal Register of Persons Suffering from Life-Threatening and Chronic Progressive Rare (Orphan) Diseases Leading to a Reduction in Life Expectancy or Disability (the "Federal Register") is maintained to provide medicinal products and specialized health food products to citizens with orphan diseases. The Register includes the citizen's SNILS, full name, date of birth, sex, residential address, passport (or birth certificate) details, the date of inclusion in the Federal Register, the diagnosis, and other information determined by the Government of the Russian Federation.

Pursuant to Government Decree No. 403 dated April 26, 2012, the Ministry of Health of Russia maintains the Federal Register electronically. It enters records with unique numbers based on data from regional segments regarding individuals with diseases on the approved list. Medical organizations must submit information about individuals with orphan diseases to regional departments of the Ministry of Health within 5 business days of the diagnosis.

Since September 1, 2020, Article 44.1 was added to the Law on Health Protection, establishing the Federal Register of Citizens Entitled to Provision of Medicinal Products, Medical Devices, and Specialized Health Food Products at the Expense of Federal and Regional Budgets. This register includes SNILS, full name, birth date, sex, address, identity document details, CHI policy number, citizenship, grounds for staying in Russia (for foreigners or stateless persons), the date of inclusion, the diagnosis, the category of citizens or disease category entitling them to medication, and details on the prescription and dispensing of drugs.

Categories of citizens entitled to medicinal products are determined based on the List of Population Groups and Disease Categories for which drugs and medical devices are dispensed free of charge, and the List of Population Groups for which drugs are dispensed with a 50% discount, both approved by Government Decree No. 890 dated July 30, 1994. Under this decree, children in their first three years of life and disabled children under 18 receive all drugs free of charge. Simultaneously, patients with certain rare diseases (phenylketonuria, acute intermittent porphyria, precocious puberty, hematological diseases, hemoblastoses, cytopenias, hereditary hemopathies) also receive necessary drugs free of charge.

The Ministry of Health has repeatedly noted in its clarifications that denying medicinal provision to citizens with rare diseases at the expense of regional budgets is impermissible [15]. However, in reality, Russia still faces an orphan drug deficit. Only 19 regions reported that they fully provide for their patients. These include the Republics of Buryatia, Dagestan, Karelia, Mordovia, the Murmansk and Rostov regions, the Kamchatka Territory, and others. In monetary terms, the total budget deficit of the analyzed regions in 2020 was 2.5 times lower than the 2018 deficit for those same entities [16].

Similar problems occur abroad. In Canada, both the federal and provincial (territorial) governments have jurisdiction over healthcare. The federal government ensures the efficacy, safety, and quality of orphan drug production, while provinces manage the financial reimbursement for orphan drug purchases. Because each province has its own coverage plan, the financial accessibility of medicinal aid for orphan patients is highly inconsistent across territories [17].

In the EU, a cross-border regulatory system helps patients access treatment when orphan drugs or specialized clinicians are unavailable in their home country. EU Directive 2011/24 clarifies patient rights to cross-border healthcare, allowing patients with rare diseases to receive healthcare within the EU if their national system cannot provide necessary treatment within a reasonable timeframe [18].

Nevertheless, the shortage of orphan medicinal products forces patients to defend their rights in court. For example, the Supreme Court of the Russian Federation upheld a district court decision requiring a regional department of the Ministry of Health to purchase a life-saving drug for a disabled child. The child suffered from an orphan disease, and the only possible treatment was a drug not registered in Russia. The court noted that under the Convention on the Rights of the Child, officials must take necessary measures to reduce infant and child mortality and ensure necessary medical aid and health protection. The Supreme Court rejected the appellate court's conclusion that only patients whose diagnosis is specifically named in the list approved by the 2012 Government Decree are entitled to regional funding, clarifying that the broader list of orphan diseases on the Ministry of Health website also creates legal obligations [19].

In another case, the Supreme Court protected a child's interests, concluding that since a medical board of a republic clinical hospital had prescribed the drugs for an orphan disease for life, the absence of a doctor's prescription could not diminish the disabled child's right to free medication. Consequently, the refusal to provide the drug was unlawful [20].

These situations are noteworthy because such disputes must reach the Supreme Court, which consumes time and adversely affects the health of orphan patients. Furthermore, there have been egregious cases where law enforcement detained parents of children with orphan diseases for purchasing life-saving, unregistered drugs online [21].

This issue was addressed by amendments to the Law on Circulation of Medicinal Products via Federal Law No. 475-FZ dated December 27, 2019. Under the new amendments, it is possible to import drugs whose free circulation is prohibited in Russia for the needs of specific patients.

Currently, numerous legal acts regulate the provision of orphan drugs to children through the Circle of Kindness Foundation. For instance, according to the 2021 procedure for acquiring medicinal products, medical devices, and technical rehabilitation means for a specific child with a severe life-threatening or chronic disease, the Ministry of Health funds these purchases through federal budget allocations. The Circle of Kindness funds its purchases, imports, and deliveries through federal grants, voluntary contributions, donations, and other legal sources. The Foundation's Expert Council sends information about the need for drugs to the Ministry of Health, including a list of recipient healthcare organizations, and the Ministry conducts the procurement [22].

Thus, despite the improvement of current legislation aimed at providing orphan patients with necessary drugs, the issues of shortage and untimely receipt remain unresolved. We believe that the active involvement of the Ministry of Health and the Government of the Russian Federation in improving the medicinal provision for orphan patients will positively impact the resolution of existing problems.

______________

References

[1] Genesis and Prospects of Legal Regulation of Orphan Drug Circulation in Russia and Foreign Countries. Panfilova V.I. // Medical Law. 2018. No. 6. pp. 41–45.

[2] EEC Council Decision No. 78 dated November 3, 2016, On the Rules for Registration and Expertise of Medicinal Products for Medical Use.

[3] Approximately 16,000 People with Rare Diseases Live in Russia. RIA Novosti. February 29, 2020.

[4] Orphan Drugs and Their Role in the Pharmacotherapy of Orphan Patients. Bondareva T.M., Parfeynikov S.A., Gordienko V.V. // International Research Journal. No. 3-4 (22) 2014. p. 119.

[5] Government Order No. 3684-r dated December 31, 2020, On Approving the Program of Fundamental Scientific Research in the Russian Federation for the Long-Term Period (2021–2030).

[6] Government Decree No. 769 dated May 21, 2021, On Approving the Rules for Providing Medical Care (if Necessary, Outside the Russian Federation) to a Specific Child with a Severe Life-Threatening or Chronic Disease, Including a Rare (Orphan) Disease, or Groups of Such Children.

[7] Government Decree No. 2409 dated December 23, 2021, On Approving the Rules for Providing Grants in the Form of Subsidies from the Federal Budget to the Foundation for Support of Children with Severe Life-Threatening and Chronic Diseases, Including Rare (Orphan) Diseases, "Circle of Kindness".

[8] Order of the Ministry of Health of Russia No. 930n dated December 15, 2015, On Approving the Scope of Information Necessary for Forming the Clinical Documentation Section During the State Registration of an Orphan Medicinal Product.

[9] Gavrilov E.P. Legal Protection of Medicinal Products: What Needs to Be Changed? // Patents and Licenses. 2018. No. 4. pp. 15–20; No. 5. pp. 16–23.

[10] Davydov Yu.G. Stimulating the Civil Circulation of Orphan Medicinal Products in Russia // Social and Pension Law. 2020. No. 3. pp. 37–41.

[11] Status of Orphan Drugs // Financial Encyclopedia. May 8, 2021.

[12] The US Adopted a Law on Regulating the Orphan Drug Market. Nikolay Sokolov // Pharmaceutical Bulletin dated November 19, 2020.

[13] Volkova N.S., Aksu E. Rare (Orphan) Diseases: Legal Regulation in Russia and Abroad // Journal of Foreign Legislation and Comparative Law. 2018. No. 4. pp. 154–160.

[14] Putin: Funds from the PIT Increase Will Be Directed Toward Treating Children. Alexey Nikolsky, RIA Novosti dated June 23, 2020.

[15] Letter of the Ministry of Health of Russia No. 21-6/10/2-4878 dated July 8, 2013, On the Inadmissibility of Denying Citizens Suffering from Rare Diseases Medicinal Provision at the Expense of Regional Budgets.

[16] Federal Support and Road Map: How Aid to Orphan Patients Will Change in Russia? July 20, 2020. Roscongress.

[17] Volkova N.S., Aksu E. Rare (Orphan) Diseases: Legal Regulation in Russia and Abroad // Journal of Foreign Legislation and Comparative Law. 2018. No. 4. pp. 154–160.

[18] Genesis and Prospects of Legal Regulation of Orphan Drug Circulation in Russia and Foreign Countries. Panfilova V.I. // Medical Law. 2018. No. 6. pp. 41–45.

[19] Ruling of the Supreme Court of the Russian Federation No. 29-KG19-1 dated August 12, 2019.

[20] Ruling of the Supreme Court of the Russian Federation No. 11-KG19-24 dated December 2, 2019.

[21] Federmesser Urged Not to Punish Mothers for Purchasing Medicines for Children. Ramil Sitdikov. RIA Novosti. July 18, 2019.

[22] Government Decree No. 545 dated April 6, 2021, On the Procedure for Acquiring Medicinal Products, Medical Devices, and Technical Rehabilitation Means for a Specific Child with a Severe Life-Threatening and Chronic Disease, Including a Rare (Orphan) Disease, or for Groups of Such Children.