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Challenges for financing orphan drugs in Latin America

Foto Rosa Mari Galindo

Rosa María Galindo Suárez
Economista Instituto Autónomo de México (ITAM)
Magister en Economía de la Salud y Gestión Sanitaria de la
Universidad Pompeu Fabra de Barcelona, España
Presidenta de ISPOR Capítulo México 2014-2017

It is known that orphan drugs are intended for the treatment of rare diseases, which are of very low prevalence. The pharmaceutical industry has stated that the development of these drugs has a very high cost and since they are intended for a very small number of patients, as well as having access barriers and patent limitations, it is very difficult for price discussions to be held that satisfy both the buyer and the owner of the technology.

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Since high-cost medicines can call into question the financial sustainability of any health system, it is necessary to seek financing alternatives that help to provide treatments to patients in the best manner. That is, we are at a moment of enormous challenges that the health sector and all the participants in this sector have to face.


Currently, in most of the health technology assessment agencies and organizations in the region, the evaluation of orphan drugs, in order to determine their inclusion for prescriptions and which can be reimbursed, does not differ substantially from the evaluation of drugs for diseases of higher prevalence. For example, today in the countries of our region there are no specifications for considering different cost-effectiveness thresholds for an orphan drug, there are no different criteria for measuring the burden of disease or the consideration of contracts based on results or value-based models (Value-Based Health Care), with some exceptions such as Colombia, which is the country that has advanced the most with these types of models, and Brazil, which has begun to review the implementation of these models.


Therefore, it is necessary to think about how to move forward with mechanisms and new evaluation models, or to make the existing ones more robust, in order to face the financial challenge of access to orphan drugs. Some possible proposals are:


  • that the value framework or multicriteria analysis methods explicitly incorporate the economic principle of opportunity cost to establish more precisely the weighting of each criterion analyzed;
  • to accelerate the adoption of instruments such as the measurement of patient outcomes (patient-related outcomes) that allow the establishment of treatment agreements subject to results, which can be reviewed periodically to continue granting treatments to patients who meet the established clinical goals. It is clear is that the implementation of these instruments in each country of the region is an action that depends largely on the advances in the research that the pharmaceutical and device industries have to carry out – although it is well understood by government authorities that there are still barriers that hinder the progress of clinical studies in some countries, great progress has nevertheless been made in the regulation of this topic, as in the case of Mexico;
  • to base it on the production costs of the drug to make an estimation of cost per QALY, that is, to better understand the investment in research and development that gives greater certainty of the support of the high cost of the technology.


Therefore, it is vital that in order to support discussions with government agencies about the inclusion and eventual purchase of medications, patient data must be available for each country and not just for the region. There are probably those who question why patients in one country would behave differently than patients in another country, and why the results cannot be extrapolated; well, presently there is evidence that these differences occur, based on the results of the application of instruments for measuring quality of life: in other words, it has been shown that results from one country to another can vary significantly.


It must be appreciated that today, regardless of whether countries have more or less regulation, technology agencies or evaluation organizations, EVERYONE is facing problems with financing high-cost treatments. However, this already complicated scenario is facing the arrival of gene therapies that make the outlook for financial sustainability even more challenging. If today we have high-cost therapies that cost thousands of dollars and do not result in enough patient access, what will happen with these innovations that will cost millions of dollars?


It is vital to work on the design of new evaluation methods and payment mechanisms. The alternative of generating regional financing schemes must be reviewed, to think of models of investment of funds to create specific allocations of resources independent of the budgets already assigned to health care, in order not to put at risk the status of health programs that have been already defined.


Finally, it must be remembered that the governments’ commitments towards achieving universal health coverage are a great step forward, but it is even more important to know how these commitments will translate into real actions and policy changes with the right means and resources, and how they can be sustained in the long term, regardless of political instability or electoral cycles.


In order to achieve the promise of universal health coverage, allowing the significant inclusion of rare diseases within universal health coverage programs, it is necessary to continue with the sustained investment of resources and an integrated perspective that considers all the barriers that could hinder a real transformation of sustainable medical care.


1. Porter, M.E., Teisberg, E. (2006). Redefining Health Care: Creating Value-Based Competition on Results. Harvard Business Publishing.

2. Henry D. et al Update on 2004 Background Paper, BP 8.3 Pricing and Reimbursement Policies: Impacts on Innovation. WHO 2013

3. Using Multicriteria Approaches to Assess the Value of Health Care, Value in Health, Volume 20, Issue 2, 2017, pp. 251-255


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