EXECUTIVE SUMMARY Access to medicines reform within the Canadian government is essential to address

the urgent need of over a billion people for rare and neglected disease therapies. The recent discussion over Health Canadas proposed Orphan Drug Framework provides an opportune moment to introduce priority review vouchers (PRVs) a simple, politically and financially feasible option to mobilize Canadian pharmaceutical research and development for rare and neglected diseases. PRVs are awarded to drug developers that successfully develop therapies for rare and neglected diseases. This entitles the manufacturer to an expedited review for any drug of their choice. Early introduction of blockbuster drugs (e.g., cardiovascular therapies) can be worth millions of dollars in profit. Thus, PRVs will not only motivate pharmaceutical companies investment in rare and neglected disease drug development, but also drive Canadian innovation and promote health on a national and international scale. Initiative for Global Access to Medicines (IGAM) is a student organization that promotes access to medicines reform. POLICY PROPOSAL: Including Priority Review Vouchers (PRVs) in Canadas Orphan Drug Framework PRVs will help address the market failure common to rare and neglected diseases and incentivize drug development PRVs will entitle the drug developer for a rare or neglected disease to an expedited review for any drug Earlier market entry for drugs is projected to be worth tens of millions of dollars

BACKGROUND
For the one in twelve Canadians suffering from a rare disease, accessing vital medicines remains a challenge. Similar obstacles are faced by the approximate 1 billion people worldwide who bear the burden of neglected diseases in low- and middle-income countries (LMICs). In both situations, a lack of research and development (R&D) for novel drugs significantly hinders access to medicines, since no safe and effective therapies exist for most of these diseases. For example, only 2% of treatments introduced from 1975-1999 were focused on neglected diseases. This R&D gap can be attributed to the lack of market incentives needed for pharmaceutical companies to mobilize and invest in rare and neglected diseases. In an attempt to address this market failure, Health Canada is currently in the final stages of developing an Orphan Drug Framework proposal to incentivize R&D for orphan drugs (i.e., treatments for diseases that affect less than five in 10 000 Canadians). Building off the United States 1983 Orphan Drug Act, the Canadian Orphan Drug Framework will give pharmaceutical companies multiple incentives to pursue development of novel drugs. These include tax exemptions, enhanced patent protection and a period of market exclusivity for novel drugs. In theory, such incentives should stimulate a greater commitment to investing in rare and neglected diseases. However, the incentives proposed in the Orphan Drug Framework are not enough for some diseases, including ultra-rare diseases faced by Canadians and neglected diseases faced by people in LMICs. In both cases, the extremely small pool of potential consumers who can afford these medicines presents a major barrier for investment. Thus, an additional pull strategy is needed to address this shared market failure.

Key Terms Rare diseases affect fewer than five in 10 000 Canadians. Ultra-rare diseases affect fewer than twenty in 1 million Canadians. Neglected diseases include 18 tropical diseases (e.g., tuberculosis, cholera) that disproportionately affect LMICs.

Incentivizing Drug Development: the Priority Review Voucher

To stimulate the development of new medicines for both rare and neglected diseases, Health Canada should award priority review vouchers (PRVs) to companies that develop and obtain approval for rare or neglected disease therapies. Priority review vouchers which can be sold or transferred would entitle the bearer to a priority review for any drug of their choice. Priority reviews represent an important and highly valued incentive for pharmaceutical companies. Under the normal review process, it currently takes Health Canada an average of 18 months to review and approve a new drug. Much of this lengthy process can be attributed to massive submission backlogs and inefficiencies in the approval system. In contrast, decisions from priority reviews which undergo the same quality, safety and efficacy testing are consistently made within 6 months. However, only a small subsection of drugs (i.e., those for lifethreatening diseases) are currently eligible for priority reviews. PRVs would act a strong incentive as they would increase the potential scope of products that could undergo priority review and, as a result, allow companies to introduce their profitable products to the market faster. In the case of blockbuster drugs, economic models have predicted that the faster time to market could be worth up to $300 million in the American context. In the Canadian market, such an incentive would remain similarly lucrative. PRVs represent a simple, easy-to-implement and low cost incentive that would help address the shared market failure which leads to a lack of investment for rare and neglected disease drug development. Demonstrating their feasibility and appeal, PRVs were introduced in the US in 2007 just one year after the idea was proposed by Duke University researchers. Further supporting their value, a recent study reported that 91% of the small and large pharmaceutical companies surveyed considered the PRVs as a strong or major factor for initiating or continuing their companys neglected disease projects.

Figure 1 How PRV system would work

PRVs Facts
Allow companies to obtain a priority review for any drug as a reward for their development of drugs for rare and neglected diseases Incur few additional costs Can be sold and traded

Priority Review Facts

Include the same rigorous safety, quality and efficacy testing as other reviews Additional reviews would not push back other drugs in the approval process instead, a new review slot would be created

Moving Forward: Taking Action on Developing Lifesaving Drugs

As Health Canada brings the proposal announcing the Orphan Drug Framework to Parliament in the upcoming weeks, we request your support in introducing a provision to include a priority review voucher system. Through bringing attention to this important issue, you will potentially help catalyze the R&D of lifesaving medicines for Canadians and people all over the world.

Potential Benefits & Implications

1. Stimulating Canadian R&D
PRVs will incentivize R&D in the private, for-profit pharmaceutical sector. By linking incentives for blockbuster drugs to drugs for rare and neglected diseases, PRVs will tap into the power of market forces to promote innovation. Such an engagement will also be complementary to other efforts being undertaken to support innovation in Canadas increasingly knowledge based economy, potentially driving further investment, productivity and economic growth.

2. Promoting health for Canadians

PRVs will lead to the development of much-needed drugs for Canadians suffering from rare or neglected diseases. While it is estimated that there are approximately 6000 to 8000 rare diseases globally, treatments exist for only 200. Increased priority reviews as a result of the PRVs would also help bring drugs for common diseases (e.g. cardiovascular diseases) to the market faster. If a patented drug reaches the market one year earlier with a priority review, then cheaper, generic versions of the drug will also be available to consumers earlier.

3. Improving health globally

PRVs will stimulate the development of novel therapies for neglected diseases disproportionally affecting LMICs, reflecting Canadas humanitarian values. In addition, PRVs will complement Canadas leadership in womens and childrens health by incentivizing the development of lifesaving treatments. Support for PRVs will also be a part of Canadas efforts to reach the current Millennium Development Goals to combat HIV, malaria and other diseases, reduce child mortality and improve maternal health.

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4. Doing right, at little cost

PRVs can be introduced at a very low administrative cost, as a user fee would be required from the manufacturer to redeem a priority review voucher. This fee estimated to be around one million dollars would cover the cost of the additional resources required by Health Canada to engage in a priority review. Such a process would also ensure that priority reviews would not slow other drugs in the approval queue; instead, a separate review slot would be created.

Initiative for Global Access to Medicines (IGAM) is a student organization that promotes access to medicines reform. Head Office, MDCL 3308 McMaster University 1280 Main St W Hamilton, ON +1 647 282 2533 http://www.igam.ca inquiries@igam.ca Initiative for Global Access to Medicines @IGAMCanada

CONCLUSION
The proposed Orphan Drug Framework by Health Canada is in the final design stages and will be introduced in Parliament this winter. Your support for priority review vouchers as a key component of the Orphan Drug Framework will help incentivize the research and development of novel therapies for rare and neglected diseases. Priority review vouchers represent a simple, easy-to-implement and low cost incentive that has proven to be successful in other jurisdictions. The introduction of priority review vouchers in the Orphan Drug Framework will mark an important step forward taken by Canada to address the access to medicines crisis faced by millions of people at a national and international level.