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Health Affairs This Week places listeners at the center of health policy’s proverbial water cooler. Join editors from Health Affairs, the leading journal of health policy research, and special guests as they discuss this week’s most pressing health policy news. All in 15 minutes or less.
Hello, and welcome to Health Affairs This Week. I'm your host, Byers. We are recording on 03/12/2026. Before we get started, I wanted to plug the March Insider event with Ben Rome. It's titled PBM reform fact or fiction, and it will be held on March 24.
Jeff Byers:So please check that out. If you're interested in becoming a member of Insider, we have a lot of great events coming up for the spring, including one on the Medicare Advantage market and ICHRA. So that will be those will be announced soon, and that's in addition to trend reports, cheat sheets, and newsletters that you get. So join us today on the pod to talk about the FDA and rare diseases is Leslie Erdelack Leslie, welcome back to the program.
Leslie Erdelack:Hey, Jeff. Good to be here.
Jeff Byers:Yeah. As we were talking off, Mike, we're we're getting whiplash on this weather. You in Pittsburgh, me in Richmond seems to, done a number on the whole region.
Leslie Erdelack:Fake spring. Fake spring is what we're calling it. Yeah.
Jeff Byers:Yeah. Well, I'm looking at out at a very real rainstorm currently, so hopefully it will let us continue recording. We're dressed for it too, might I add. Yeah. People can't see me, but I have a I have a rain jacket just in case the roof blows off.
Leslie Erdelack:Always be prepared.
Jeff Byers:That's right. Always be prepared, but leave no trace. So it was announced last week that Vinay Prasad would exit the FDA. Politika reported that it comes after criticism of his handling of rare disease therapy candidates. So we're gonna talk about the new FDA draft guidance, but quickly stepping back, what has the FDA done in this space recently, and and why has it been controversial?
Leslie Erdelack:Yeah. So you're right. Vinay Prasad, who had been overseeing vaccines, gene therapies, and biologics at FDA, is leaving at the April. And just to catch you up, this is this is his second departure. He was first pushed out last July after a dispute with a company called Sarepta Therapeutics over their Duchenne muscular dystrophy gene therapy.
Leslie Erdelack:And what happened there was that FDA asked Sarepta to stop distributing it after reports of patients dying. They then reversed their decision. A few days later, conservative allies of the president were very upset, and the White House forced Prasad out. But the FDA lobbied for his return, and he was back within two weeks. So this time, his exit from the agency was supposedly triggered by a decision related to gene therapy for Huntington's disease.
Leslie Erdelack:And so the FDA told the company Unicor that its earlier studies were inadequate and recommended a placebo surgery, basically a faked surgical procedure. I did not know this was a thing where control patients would be anesthetized and get superficial scalp incisions to simulate brain surgery. There, of course, were questions about whether that was ethical. The public fight escalated, and Prasad himself reportedly led a press briefing defending the decision right before his departure was announced. So I say all of this just to say that these episodes really fed the narrative that the FDA under Prasad was unpredictable.
Leslie Erdelack:So companies felt like the rules were really shifting mid game, and so there was, there was a lot of tension there.
Jeff Byers:Yeah. And this is all in the rare disease space. Is that correct?
Leslie Erdelack:That's right.
Jeff Byers:So it's kinda underpinning a lot of, activities in that space. And one of the activities, has been that the FDA released draft guidance to help manufacturers of personalized therapies for rare diseases win agency approval. So kinda looking back, like, what is the current market for these manufacturers?
Leslie Erdelack:The rare disease therapeutics market is is huge, and it's growing really fast. So globally, it's valued at roughly $245,000,000,000 and it's projected to more than double in the coming years. North America accounts for almost half of that market. So The US is really the primary hub for rare disease drug development. Although other countries like China are starting to do more clinical testing on gene therapy.
Leslie Erdelack:And I think what's really striking is how much of FDA's own work is now focused on rare diseases. So this is sort of the portfolio of work that Vinay Prasad was responsible for. So orphan drugs account for more than half of all novel drug approvals. So this isn't really a niche space anymore. The challenge though is that despite all of this momentum, about ninety percent of the more than 7,000 known rare diseases still don't have any FDA approved treatment.
Leslie Erdelack:So there is a sense of urgency here that I think regulators seem to be responding to.
Jeff Byers:Yeah. And when you say orphan drugs, is that a what's the definition of that?
Leslie Erdelack:These are drugs that affect or or I'm sorry. These are drugs that are designed to treat conditions that affect less than about two hundred thousand people in The US.
Jeff Byers:Speaking of those people, who are the patients in this target segment?
Leslie Erdelack:So rare diseases affect, more than thirty million people in The US, and about half of them are children. So again, that's, I think, important context for understanding the kind of urgency here. And what FDA is doing, just to make this distinction, what FDA is doing with this framework is actually targeting a much narrower slice of that population. So people with these ultra rare genetic conditions where the patient population is just so small that like a traditional randomized controlled trial, those just aren't feasible. So we're talking about conditions, you know, to your question about, you know, size and how many people are affected.
Leslie Erdelack:We're talking about conditions that might affect a few 100 people, a few dozen, or like in the most extreme cases, just like a single patient who has a really truly unique genetic mutation. And many of these patients are children who have severely debilitating or life threatening diseases. The baby KJ case that was in the news that inspired this framework was a newborn. So that kind of gives you a sense of the scale. So we're talking hundreds or maybe thousands of patients with these types of rare diseases, like not millions.
Leslie Erdelack:And, you know, I think these are patients where the traditional drug development model was, like, never built to serve. So that's that's again, that's the gap that this framework is really designed to fill.
Jeff Byers:Yeah. And then finally, just because this could be someone's first foray into drug development, drug manufacturing, rare diseases, I'm not an expert in this, so what are the broad therapies here?
Leslie Erdelack:Mhmm. So there are several broad categories of therapies in the rare disease space, so I'll go over three. So the most established approach is enzyme replacement therapy, essentially giving patients regular infusions of a protein their body can't make on its own. It works, It's a lifelong treatment. It manages the disease rather than curing it.
Leslie Erdelack:Next, you have targeted drugs, things like monoclonal antibodies and small molecule drugs that are designed to interfere with specific disease pathways. These are used in treating rare cancers, blood disorders, and metabolic conditions. And then lastly, there are therapies that go after the root genetic cause. And so this includes gene editing, for example, where you're actually going into a patient's DNA and repairing the specific mutation that causes their disease. So these are therapies that target the precise biological cause of disease in a person, which is what makes them so so cutting edge.
Jeff Byers:Well, Leslie, thanks for walking us through all that. Now finally, we can get to the FDA draft guidance. So what are the high level takeaways from this new draft guidance framework?
Leslie Erdelack:Okay. Three big takeaways. One, this represents, I think, FDA's views on how to generate substantial evidence of effectiveness that could lead to faster approvals of therapies that are designed for, again, those extremely small patient populations. Because when, again, when a disease affects only one or maybe like a handful of people, you you can't run these large trials. So this framework basically says, if the science is strong enough, a single well controlled clinical study can support approval.
Leslie Erdelack:And that that's just a fundamental shift in in how FDA operates. So number two, the framework defines what strong enough science means. And it does that through five criteria. So you wanna identify the genetic cause of the disease, you wanna target it directly, you have to be able to show what happens to patients without treatment, confirm that your therapy actually hit its target, and then show that the patient improved in a way that's inconsistent with how the disease normally progresses. So taken together, these criteria are just, they're about building a chain of logic.
Leslie Erdelack:So from the cause to sort of understanding the mechanism to measurable improvement, that all needs to be compelling enough to substitute for a traditional large scale trial. And three, this framework really solves a practical problem. So a single rare disease might involve dozens of mutations, each one might need a slightly different therapy. This framework lets manufacturers bundle those therapies together in one application. So rather than running like a separate approval process for every single mutation, and starting from scratch each time, you can do this.
Leslie Erdelack:So and and most small biotechs, like, can't afford to run those multiple trials anyway. So here, each patient who is treated successfully builds the evidence base for the next one. So the regulatory burden is lighter, and it makes it feasible for companies to invest in treating these really small patient populations.
Jeff Byers:Are there any steps or context that we should take away from this?
Leslie Erdelack:Yeah. I think there's I think there's a few things to watch. So it's important, of course, to remember, that this is just draft guidance. It does it it represents the FDA's current thinking, but it's not legally binding. Right?
Leslie Erdelack:It does it it doesn't create new legal authority. And, of course, Vinay Prasad's departure creates another leadership transition at FDA. So it's kind of more of an open question whether this philosophical shift at the FDA toward, like, fewer but more rigorous studies survives this transition. And I just think too, there's kind of this, like, lingering question. It's sort of like, is there a risk that FDA is lowering its standards?
Leslie Erdelack:And that's something I was thinking about as I was preparing to to come on the show. And I came across this piece that Vinay Prasad and Marni Makari did in the New England Journal last month, and they they argued that, like, the number of trials was never really the safeguard here. Like, the quality of the trial is. So two poorly designed studies can give us just as many wrong conclusions as one. Right?
Leslie Erdelack:So like, it's just this shift from counting trials to evaluating whether like the totality of evidence can show that a therapy works. And again, I
Jeff Byers:think
Leslie Erdelack:that's a big shift. I think it's a new way of doing things. And so we'll have to kinda see how durable that philosophy is in the months to come.
Jeff Byers:Leslie Erdelack, thank you for walking us through that. Big question at the end that we won't have an answer to anytime soon, but but love to hear it. Love that's being asked. Leslie, thanks again for joining us today on Health Affairs This Week. If you, the listener, enjoyed this episode, please send it to the pharma rep in your life, and we will see you next week.
Leslie Erdelack:Thanks, Jeff.