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Worldwide Orphan Drug Market to Grow to $127 Billion by 2018

April 23, 2013
The 2013 Orphan Drug Report from Evaluate, which launched today at the 2013 BIO international Convention, sheds light on the market dynamics of orphan drugs — pharmaceutical products aimed at rare diseases or disorders — projecting that sales will experience a compound annual growth rate of 7.4 percent between 2012 and 2018, nearly double that of the prescription drug market, excluding generics.  The report based on EvaluatePharma® data found that the worldwide orphan drug market is set to reach $127 billion by 2018, doubling that of the overall prescription drug market.

For pharmaceutical companies, the findings confirm hypotheses that orphan drugs offer a greater return on investment than non-orphan drugs. Orphan drugs that have been filed for regulatory review or are in phase III trials provide a 1.7 times greater return of investment than non-orphan drugs. Moreover, phase III development costs for orphan drugs are half of those of non-orphan drugs, even though orphan drug development time does not appear to be any shorter.

The National Organization for Rare Disorders (NORD) currently estimates 30 million Americans suffer from 7,000 rare diseases. Prior to the Orphan Drug Act of 1983, legislation that financially incentivized the development of orphan drugs, only 38 orphan drugs were approved. Since then, 425 indication designations covering 347 drugs have been approved. An interesting paradox of the success of the original 1983 Orphan Drug legislation is that it was assumed common diseases were economically incentivized unlike rare diseases. But the findings of this report prompt us to question whether the development of drugs for large-disease populations is worth the high cost for Big Pharma, making us wonder: Might a ‘Common Disease Drug Act’ redress the imbalance?


Here’s a look at some of the report’s key findings:

  • In 2012, orphan drug sales increased 7.1 percent to $83 billion from the previous year. That compares with a 2.1 percent decline in overall prescription drug sales (excluding generics), which fell to $645 billion.

  • Novartis will maintain its position as the world's No. 1 orphan drug company in 2018, with expected sales of $11.8 billion.

  • Kyprolis, a drug from Onyx Pharmaceuticals for multiple myeloma, was the most promising new orphan drug in 2012, with U.S. sales expected to reach $897 million in 2017.

  • The number of orphan drug designations in the U.S. fell 7 percent in 2012, marking the first decline since 2007.  Orphan designations in Europe increased 44 percent, reversing a decline in 2011.

  • Of the 43 new drugs approved by the FDA in 2012, 15 were orphan drugs, representing 35 percent of the industry's new drug output.

The report and corresponding infographic are available for download at For an in-depth look at why orphan drugs offer a greater return on investment, read EP Vantage’s commentary, “Orphan diseases’ appeal lies in return on investment.” For additional commentary on Novartis’s orphan drug reign read, “Orphan drug lead cements Novartis ascendency.”

Anthony Raeside is Evaluate's Head of Research.