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IRA’s Orphan Drug Exemption Could Lead to More Off-Label Prescribing

 
• By Sarah Karlin-Smith

Rare disease advocates also argue that the Medicare’s government drug price negotiation orphan drug exemption – which only applies when a drug has one orphan designation – will harm other government efforts aimed at more efficient drug development.

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Rare disease advocates believe IRA will jeopardize filing of supplemental marketing applications for orphan drugs. • Source: Shutterstock

The limited orphan drug exemption in the Inflation Reduction Act’s Medicare price negotiation program could shift more drug use, particularly for rare diseases, into the off-label space and make it more challenging to ensure insurance reimbursement for those products, rare disease advocates worry.

The US Centers for Medicare and Medicaid Services has said that the IRA allows only orphan drugs with one rare disease indication to be exempt from government price negotiation. Moreover, CMS has said that the exemption is removed once a drug receives a second orphan designation, even if the drug is not approved for any indications for the additional rare disease or condition

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