Orphan drugs to be exempt from German pharma reform

There was some good news for the German biotechnology industry this week. According to proposed changes to Germany’s drug pricing reforms (The Pharma Letter October 1), orphan drugs will be exempt from a major change to the law that had threatened to undermine sales of small and medium-sized biotech firms, who are the principal producers of drugs for rare diseases. In Europe, a disease is deemed rare if no more than five in 10,000 patients suffer from it.

A key plank of the reforms is a new vetting process by an independent body, which within a year of a drug being approved will assess whether the new drug is an improvement on existing treatments. If so, state health insurers and the company negotiate a price; if not, the price will be based on similar drugs on the market.

According to a proposed amendment, orphan drugs are to be exempt from the vetting process - as industry group BIO Deutschland had demanded. The fact that a product has been categorized as an orphan drug will be deemed sufficient evidence of its added value to existing treatments. BIO Deutschland still is not entirely happy, however.