[Senate Hearing 111-1147]
[From the U.S. Government Publishing Office]



                                                       S. Hrg. 111-1147

 
                 TREATING RARE AND NEGLECTED PEDIATRIC
                  DISEASES: PROMOTING THE DEVELOPMENT
                      OF NEW TREATMENTS AND CURES

=======================================================================

                                HEARING

                                 OF THE

                    COMMITTEE ON HEALTH, EDUCATION,
                          LABOR, AND PENSIONS

                          UNITED STATES SENATE

                     ONE HUNDRED ELEVENTH CONGRESS

                             SECOND SESSION

                                   ON

 EXAMINING TREATING RARE AND NEGLECTED PEDIATRIC DISEASES, FOCUSING ON 
         PROMOTING THE DEVELOPMENT OF NEW TREATMENTS AND CURES

                               __________

                             JULY 21, 2010

                               __________

 Printed for the use of the Committee on Health, Education, Labor, and 
                                Pensions


      Available via the World Wide Web: http://www.gpo.gov/fdsys/




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          COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS

                       TOM HARKIN, Iowa, Chairman
CHRISTOPHER J. DODD, Connecticut     MICHAEL B. ENZI, Wyoming
BARBARA A. MIKULSKI, Maryland        JUDD GREGG, New Hampshire
JEFF BINGAMAN, New Mexico            LAMAR ALEXANDER, Tennessee
PATTY MURRAY, Washington             RICHARD BURR, North Carolina
JACK REED, Rhode Island              JOHNNY ISAKSON, Georgia
BERNARD SANDERS (I), Vermont         JOHN McCAIN, Arizona
SHERROD BROWN, Ohio                  ORRIN G. HATCH, Utah
ROBERT P. CASEY, JR., Pennsylvania   LISA MURKOWSKI, Alaska
KAY R. HAGAN, North Carolina         TOM COBURN, M.D., Oklahoma
JEFF MERKLEY, Oregon                 PAT ROBERTS, Kansas          
AL FRANKEN, Minnesota                
MICHAEL F. BENNET, Colorado          

                                       
                      Daniel Smith, Staff Director
                  Pamela Smith, Deputy Staff Director
     Frank Macchiarola, Republican Staff Director and Chief Counsel

                                  (ii)

  
?

                            C O N T E N T S

                              ----------                              

                               STATEMENTS

                        WEDNESDAY, JULY 21, 2010

                                                                   Page
Harkin, Hon. Tom, Chairman, Committee on Health, Education, 
  Labor, and Pensions, opening statement.........................     1
Enzi, Hon. Michael B., a U.S. Senator from the State of Wyoming..     2
Dodd, Hon. Christopher J., a U.S. Senator from the State of 
  Connecticut....................................................     4
Brown, Hon. Sherrod, a U.S. Senator from the State of Ohio.......     7
    Prepared statement...........................................     9
Franken, Hon. Al, a U.S. Senator from the State of Minnesota.....    11
Goodman, Jesse, M.D., M.P.H., Chief Scientist, U.S. Food and Drug 
  Administration, Silver Spring, MD..............................    13
    Prepared statement...........................................    17
Guttmacher, Alan E., M.D., Acting Director, National Institute of 
  Child Health and Human Development, Bethesda, MD...............    21
    Prepared statement...........................................    24
Casey, Hon. Robert P., Jr., a U.S. Senator from the State of 
  Pennsylvania...................................................    34
    Prepared statement...........................................    35
Sanders, Hon. Bernard, a U.S. Senator from the State of Vermont..    38
Silver, Alexander J., Founder, Jackson Gabriel Silver Foundation, 
  New York, NY...................................................    38
    Prepared statement...........................................    40
Dorman, Diane Edquist, Vice President for Public Policy, National 
  Organization for Rare Disorders, Washington, DC................    47
    Prepared statement...........................................    50
Crowley, John F., President and CEO, Amicus Therapeutics, 
  Cranberry, NJ..................................................    54
    Prepared statement...........................................    56
Moon, Suerie, Board Member, Doctors Without Borders USA, New 
  York, NY.......................................................    62
    Prepared statement...........................................    66
Frattarelli, Daniel A.C., M.D., FAAP, Chair, Committee on Drugs, 
  American Academy of Pediatrics, Dearborn, MI...................    73
    Prepared statement...........................................    75

                          ADDITIONAL MATERIAL

Statements, articles, publications, letters, etc.:
    Senator Murray...............................................    83
    Advanced Medical Technology Association (AdvaMed)............    83
    Peter J. Hotez, M.D., Ph.D., President, Sabin Vaccine 
      Institute..................................................    91
    Huntington's Disease Society of America (HDSA)...............    92
    National Venture Capital Association (NVCA)..................    93
    Response to questions of Senators Harkin, Enzi, Casey, Hagan, 
      and Franken by the Department of Health and Human Services, 
      Food and Drug Administration...............................    96
    Response to questions of Senators Enzi, Brown, Casey, and 
      Hagan by Alan E. Guttmacher, M.D...........................   100

                                 (iii)
  
    Response to questions of Senator Enzi by Alexander J. Silver.   107
    National Organization for Rare Disorders (NORD)..............   110
    Response to questions of Senators Enzi, Casey, and Franken by 
      Diane Edquist Dorman.......................................   111
    Response to questions of Senator Enzi by John F. Crowley.....   121
    Response to questions of Senators Enzi and Casey by Suerie 
      Moon.......................................................   123
    Response to questions of Senators Enzi and Franken by Daniel 
      A.C. Frattarelli, M.D., FAAP...............................   128



  


     TREATING RARE AND NEGLECTED PEDIATRIC DISEASES: PROMOTING THE 
                DEVELOPMENT OF NEW TREATMENTS AND CURES

                              ----------                              


                        WEDNESDAY, JULY 21, 2010

                                       U.S. Senate,
       Committee on Health, Education, Labor, and Pensions,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:03 a.m. in 
room SD-430, Dirksen Senate Office Building, Hon. Tom Harkin, 
chairman of the committee, presiding.
    Present: Senators Harkin, Dodd, Sanders, Brown, Casey, 
Franken, and Enzi.

                  Opening Statement of Senator Harkin

    The Chairman. The Committee on Health, Education, Labor, 
and Pensions will come to order.
    Good morning, everyone. We meet today to discuss a 
profoundly important issue: the lack of effective treatments 
for rare and neglected diseases. Over the years, Congress has 
devoted extraordinary sums for research into major diseases 
that afflict millions of Americans. Mostly this goes through 
the National Institutes of Health. Some, not an insignificant 
amount, goes through the Department of Defense. But, we've been 
less generous, and less successful, in mobilizing the research 
community to come up with therapies and cures for rare and 
neglected diseases.
    In the United States, rare diseases are defined as those 
that affect fewer than 200,000 people. According to the 
National Institutes of Health, there are nearly 7,000 rare 
diseases, affecting more than 25 million Americans. Yet, there 
are FDA-approved treatments for only as few as 200 of these 
diseases. And many of them afflict the most vulnerable members 
of our population, including children, and their effects can be 
profound.
    I know that there are several people, who are in the 
audience today, living with different diseases. I thank you for 
being here today to bear witness to what we need to do here, in 
terms of getting better, and more, research into this area.
    In addition to the rare diseases, the World Health 
Organization estimates that, beyond our borders, over a billion 
people suffer from one or more neglected tropical diseases. 
These are a group of parasitic and bacterial infections. They 
ravage the poorest populations in the world, and they 
disproportionately affect children.
    The conventional wisdom is that these diseases are ignored 
by drug and device companies because there are inadequate 
market incentives for engaging in the costly process of 
developing products for FDA approval. Our discussion this 
morning will explore the accuracy of that belief and what can 
be done to improve the current situation.
    Of course, in 1983, we passed the Orphan Drug Act, which 
provides certain tax benefits and market exclusivity for 
developing medicines to treat rare diseases. And in 2007, 
Congress added a tropical disease provision to the Federal 
Food, Drug, and Cosmetic Act.
    Most recently, Congress directed the FDA to convene a 
working group to recommend appropriate trial design and 
regulatory paradigms to optimize prevention and treatment of 
rare and tropical diseases. That working group convened in 
March, and we're supposed to have a report from them by March 
2011.
    And I'm also heartened that the Department of Health and 
Human Services is taking steps on its own to try to address 
this challenge. The Center for Disease Control and Prevention 
is working with the World Health Organization on combating 
certain neglected tropical diseases. In addition, the FDA 
recently created an Office of Rare Diseases, in its Center for 
Drugs, to assist sponsors in navigating the Agency's clinical 
trial and approvement requirements.
    All of these steps seem to be moving in the right 
direction. But, today we'll hear from witnesses, inside and 
outside government, who are confronting this crisis on the 
front lines.
    We'll have two panels. The first, from the Department of 
Health and Human Services, the second will be from our 
nongovernment witnesses. Each has a different perspective to 
share.
    Regrettably--I think I can speak for Senator Dodd--both of 
us will have to leave about 10:30 to go down to the White House 
for a signing ceremony. Senator Brown, who has been one of the 
great champions in the Senate, and certainly on this committee, 
of focusing on rare and neglected diseases, will take over the 
chairmanship at that time. He has been an outspoken voice, an 
advocate, for these rare diseases.
    And with that, I want to thank our former chair and Ranking 
Member, Senator Enzi, for his interest over a long time in this 
area, and will recognize him for an opening statement.

                       Statement of Senator Enzi

    Senator Enzi. Thank you, Mr. Chairman. I want to thank you 
for calling the hearing on this important issue of rare and 
neglected diseases, focusing on rare pediatric diseases.
    The Food and Drug Administration defines a ``rare disease'' 
as one that affects fewer than 200,000 Americans. Nearly half 
of rare diseases affect fewer than 25,000 people. According to 
the National Institutes of Health, there are about 6,800 rare 
diseases affecting 25 to 30 million people, total. Most of 
these conditions have no treatment or cure, and companies are 
unlikely to undertake the expensive, lengthy, and difficult 
research to develop a drug if they can't recoup their 
investment in such a small market.
    In 1983, Congress enacted the Orphan Drug Act to overcome 
these obstacles and encourage the discovery and development of 
treatments for rare diseases. The Orphan Drug Act includes: tax 
credits for up to 50 percent of the costs of research to 
develop the product; grants to assist with the costs of 
clinical testing expenses; a 7-year period of market 
exclusivity for the orphan indication, after approval of the 
orphan product; and waivers of FDA application fees and annual 
product fees. Since its enactment, there have been over 300 
orphan products approved by the FDA.
    The Orphan Drug Act is not the only mechanism to address 
rare diseases and conditions. Many diseases that occur in 
children are less common than in adults. Pediatric diseases 
face the same market disincentives that apply to other rare 
diseases. Treating children also creates unique issues because 
of their size, their metabolic rate, and their growth.
    Over the past decade, Congress has provided a number of 
incentives to overcome these obstacles and develop better 
treatments for children. Because of these incentives, we know 
how kids respond to drugs like ADHD, asthma, arthritis, 
depression, diabetes, epilepsy, hepatitis, HIV/AIDS, 
hypertension, influenza, kidney transplants, leukemia and other 
cancers, malaria, obesity, OCD, pain, seizures, and many other 
conditions.
    Three years ago, Congress passed the Food and Drug 
Administration Amendments Act, which included a number of 
important measures to encourage the development of treatments 
for rare, neglected, and pediatric diseases. We're beginning to 
see the effects of that work, and I hope we can continue to 
build on those achievements so that we can have a similarly 
successful reauthorization in 2012. This hearing will help us 
understand where there may still be barriers to success, and 
how we might lower those barriers.
    The 2007 FDA overhaul also established an innovative 
incentive system for the development of treatments for certain 
diseases that affect global populations that otherwise might 
not have sufficient market incentives. These products can be 
rewarded with a voucher for priority review of a drug. The 
voucher can be used for another product, or even sold to 
another company. This sort of creative thinking is very helpful 
to the debate. We must continue our commitments to the 
continued development of these products.
    We've also made investments in research in the area of rare 
and neglected diseases through the National Institutes of 
Health. The Office of Rare Disease Research, established in 
1993, has the mission of coordinating NIH activities to ensure 
our Nation's biomedical research investments do not overlook 
the importance of investments in rare and neglected diseases.
    In 2009, Congress mandated the office establish the 
Therapeutics for Rare and Neglected Diseases, or TRNDs, to 
encourage and spend the development of new drugs--speed the 
development of new drugs for rare and neglected diseases. 
Congress appropriated $24 million for the initiative. The goal 
of the program is to reduce the risk associated with developing 
drugs for rare and neglected diseases to meet FDA requirements 
for an investigational new drug application. Once the drug is 
ready to be licensed, the NIH will work with industry to find a 
partner to continue clinical development.
    I hope to hear from Dr. Guttmacher today about the Agency's 
activities through the TRND program, and about other innovative 
approaches to increasing investments in rare and neglected 
diseases, like the Bench-to-Bedside Program.
    I would also note that this topic brings up an important 
point about how we allocate funding for the NIH. We worked 
tirelessly to pass the NIH Reform Act to end a funding 
structure that targeted specific diseases in response to 
political, rather than scientific, reasons. The funding should 
be directed toward research grants that are based on scientific 
merit, not popularity. If it was based on popularity, probably 
the Senate would put all the money into prostate cancer.
    [Laugher.]
    A strategy for determining how NIH funding should be 
allocated is certainly necessary, but tying funds to specific 
diseases will only tie the hands of the Agency and prevent the 
scientists from innovating and conducting research in areas 
that could benefit a multitude of diseases and conditions. This 
is directly related to the topic of our hearing today. If a 
``rare disease'' is defined as impacting less than 200,000 
individuals, then we're talking about groups that have 
significantly smaller lobbying force to request increases in 
funding, which is not a fair or scientific process for 
determining funding allocations. We should continue in our 
practice of providing funding to the Institutes and allowing 
the scientists to determine which grants have scientific merit 
to receive funding, and not impose strict funding requirements 
that are based on successful lobbying by advocates for a 
specific disease.
    I'd like to thank Senators Alexander, Dodd, and Brown for 
their tireless work on pediatric and rare and neglected disease 
issues.
    I have some statements here from outside groups, and I ask 
unanimous consent that they be entered in the record. One of 
them is from venture capitalists, which was kind of a surprise.
    But, I look forward to the testimony today.
    [The information referred to may be found in Additional 
Material.]
    The Chairman. Thank you very much, Senator Enzi.
    Senator Dodd.

                       Statement of Senator Dodd

    Senator Dodd. Thank you very much, Mr. Chairman. And, like 
Senator Harkin, we'll have to be leaving a little early today. 
I'm sorry to do this. The timing is unfortunate, because this 
is an area that my colleagues on the committee know that I 
dedicate an awful lot of my time, during the Senate years, on 
these subject matters. And I'd be remiss if I didn't point out 
that Jeannie Ireland, sitting in the front row up here with my 
staff person--we did a lot of this work--and is now with the 
FDA.
    Jeannie, good to see you. Thank you for your tireless work 
over the years on this subject matter, as well.
    I just have a brief couple of comments, if I can, Mr. 
Chairman, about this.
    This is the opening round. We've got some reauthorization 
to do, and won't get it done in this Congress. But, I can't 
commend you enough for beginning the conversation. There were 
very contentious debates, going back some years ago, as we 
talked about the subject matter, generally speaking, and went 
through a number of rounds dealing with pharmaceuticals, then 
medical devices, as well, going back to the orphan drug issue 
that both you and Senator Enzi have discussed and talked about. 
Obviously, it's an ongoing discussion, debate, how we do a 
better job of this, all the way along. So, I think it's really 
worthwhile we begin the conversation this early on, and you 
couldn't have better witnesses to do that.
    Dr. Goodman has done a terrific, terrific job. Dr. 
Frattarelli, who'll be coming up later--I won't be here to hear 
his testimony, and Dr. Rich Gorman, who testified at our 
hearing on pediatric drugs and devices in 2007, and a wonderful 
individual, as well.
    So, let me just share some thoughts. Today's hearing is an 
important topic not just for children's health, but family 
health. And I spend a good part of my time in this committee 
working on--I'm pleased to see so many friendly faces in the 
audience--the reality is, we can't talk about rare diseases 
without talking about children, because most of the 
approximately 7,000 rare diseases are pediatric diseases.
    When Congress first began looking at the issue of safety 
and efficacy of pharmaceuticals for children, it was at a time 
when children were rarely included in studies of medical 
treatments, and therefore, we knew little about how children 
responded to these products. The majority of companies invested 
little or no resources into pediatric research. For some 
companies, the prospect of clinical trials in children posed 
problems of finding enough children to comprise a trial, while 
grappling with the ethical questions about conducting research 
involving children. The good news is that most children are 
healthy. And so, the idea is--as an audience, as a 
constituency--relatively small numbers of children find these 
problems. So, the incentives really weren't there. For the most 
part, the economic incentives, in fact, to pursue research in 
the smaller market of pediatrics was lacking, and all of those 
were realities we were dealing with. As a result, doctors and 
nurses had to guess at which treatments were best, at what 
dosage, for their pediatric patients. That's not because they 
were bad people or they were practicing bad medicine at all. 
They did the best they could for their patients with the 
limited information that they had.
    The situation today is vastly different as the result of an 
awful lot of work, primarily in this committee, I might add, by 
Democrats and Republicans, alike, working on this issue 
together. With the passage of the Better Pharmaceuticals for 
Children Act, in 1997, where my partner in that bill was Mike 
DeWine of Ohio, we began that process of really looking at 
pharmaceuticals for children and how we could engage in better 
information.
    The subsequent reauthorization, in 2002 and 2007, has led 
to more than 385 drug labels that have been revised with new 
safety, effectiveness, and dosage information. The studies 
completed under this program revealed that, in some cases, our 
children were being overdosed and, in some cases, under-dosed. 
In others, we discovered that the drug was simply not effective 
in children.
    The Pediatric Research Equity Act, which was part of that 
reauthorization that Senator Clinton, our former colleague, and 
I were deeply involved in--she had originally issued a rule, 
when she was in the White House--the Executive order, back when 
President Clinton was in the office--and that was overturned, 
at one point. And so, we began to then incorporate, 
legislatively, her language.
    One of the things we did, unfortunately, with that bill is 
to sunset the requirement of trials to be done with children, 
which I regret. We don't do that with adults at all. But, that 
sunset provision was written into the legislation, back with 
the reauthorization of the bill.
    With the Better Pharmaceuticals for Children's Act--it's a 
voluntary program. The incentive structure produces benefits 
for children, because the FDA can and does set the requirements 
for what companies must study. And the FDA has the final say 
over whether the 6 months of exclusivity can be granted. But, 
with the experience, we learned new things about the program, 
and we learned how to make it better.
    During the most recent reauthorization of the Better 
Pharmaceuticals for Children Act, in 2007, we made improvements 
that have resulted in companies conducting studies earlier in 
the patent life of their products, meaning more and faster 
labeling changes, improved adverse-event reporting, and we 
created, as I mentioned, the Pediatric Review Committee, which 
has better integrated pediatrics across the review divisions in 
a consistent and productive way.
    In 2005, the Institutes of Medicine published a report, 
entitled, ``Safe Medical Devices for Children.'' In it, the ILM 
experts called for systemic attention to children's needs in 
medical device design, use, and evaluation, as well as a better 
functioning system of postmarket surveillance for medical 
devices to safeguard children. As a result, along, again, with 
Senator Mike DeWine, my partner in that legislation, we 
authored the Pediatric Medical Device Safety and Improvement 
Act, which became law in 2007.
    The development of pediatric devices shares obstacles 
similar to those faced in drugs, but the incentive structures 
are different. The law has produced the first pediatric 
humanitarian-use device approved as a result of the incentives 
under this program. And the FDA is running a robust new grant 
program encouraging the development of new pediatric devices, 
thanks to the funding from our good friend from Wisconsin, 
Senator Herb Kohl, who chairs the Agricultural Appropriations 
Subcommittee.
    As I head into my final months in all of this service in 
the Senate, Mr. Chairman, there's still much to be done in the 
area of rare and neglected diseases in children. As we've made 
an awful lot of progress with the passage of the Orphan Drug 
Act, but only 200 of the nearly 7,000 rare diseases currently 
have FDA-approved treatments. We've made headway with 
identifying newborns for rare, but debilitating, genetic 
conditions, through the expansion of newborn screening. And I 
authored that bill along with--Lamar Alexander, of Tennessee, 
who was my partner on that, as well--as we did in the premature 
birth legislation, as well. I point out, this is the kind of 
cooperation we've had on this committee in dealing with these 
issues, historically. And hopefully that will be the case 
again, as we move forward.
    Here we've improved the availability of safe and effective 
treatment options for children, but many of these children will 
remain and have lifelong problems. There, their parents 
struggle with insurance coverage, because, oftentimes, 
treatments for children are considered investigational or are, 
in fact, off-label. And when I see people like Sherrod Brown 
and Al Franken here, as relatively new members of this 
committee--even though I'll be leaving in January, I'm very 
encouraged that the same kind of effort that's been made in the 
past 20 or 30 years, working on these issues, will continue.
    And obviously Al Franken, coming from Minnesota, the home 
of the medical device industry, for the large part, has a great 
familiarity with the subject matter. We would like a little 
more cooperation from the device industry in this legislation, 
I'd point out to my friend from Minnesota. He might want to 
look into that, and talk to us about it, as well, since we 
passed the legislation.
    But, nonetheless, these are some great starts in this area. 
And again, wonderful witnesses today to set the tone, in my 
view, as we look forward now to the reauthorizations that will 
have to occur.
    And I thank you, Mr. Chairman, for the time.
    The Chairman. Well, thank you, Senator Dodd. And again, 
thank you for all your years of focus and attention on this and 
all the various pieces of legislation that you worked with 
others on to get through. We're going to miss you on this 
committee, but, as you pointed out, we have other champions 
here.
    Senator Brown has devoted a large part of his service, in 
both the House and the Senate, in focusing on this issue. He's 
been one of the true champions of rare and neglected diseases. 
And so, we'll have a good person to carry on here.
    Senator Dodd. Thank you, Mr. Chairman.
    The Chairman. Senator Brown, I'll recognize you for an 
opening statement.

                       Statement of Senator Brown

    Senator Brown. Thank you, Mr. Chairman.
    I appreciate so much your work on this committee on these 
issues, Senator Dodd and Senator Enzi, and Senator Dodd's work 
on children's issues for his whole career, and what it's meant 
to so many young people in our country, and so many families.
    There's been a lot of partisanship in the halls of Congress 
recently. But, I don't expect partisanship in this room today, 
and that's to the credit of this committee's leadership. The 
unfortunate reality is that, whether we're talking about 
education or poverty or violence or health, the well-being of 
our Nation's children is not made a high enough priority. Great 
strides are being made, with respect to children's health, 
thanks to Medicaid, CHIP program, and the recently passed 
health reform legislation, but there are still areas where our 
efforts fall substantially and woefully short.
    One such area, as we know, is research and development for 
pediatric diseases and conditions. Despite the fact that 
children and adolescents account for one-fifth of our Nation's 
population, pediatric research by NIH accounts for a mere 5 to 
10 percent of the total NIH budget. Despite the fact that 
children account for some 20 percent of our Nation's 
population, most drugs on the market have never been tested in 
children.
    If we're falling short in our efforts to cure and treat 
pediatric diseases and conditions, we're falling woefully and 
inadequately short in our efforts to cure and treat rare and 
neglected pediatric diseases and conditions.
    Seven thousand known rare or orphan diseases afflict nearly 
30 million Americans--approximately 50 percent of whom are 
children. Even with millions affected by these rare diseases, 
research opportunities remain all too scarce; and approved 
therapies, even scarcer.
    One of these rare diseases is epidermolysis bullosa, 
otherwise known as EB. EB is a debilitating, disfiguring, 
potentially deadly skin disease directly affecting 
approximately 12,000 people in the United States, most of them 
children. Because these children are born without the typical 
anchors that hold the epidermal and dermal skin layers 
together, any form of pressure creates unbearable friction, and 
can make the simplest of activities, like hugging and playing, 
even sleeping, calamitous. The most common characteristics of 
EB are chronic blistering and ulcers and scarring. Though the 
genes causing all types of EB have been identified, a cure 
continues to elude the medical community, primarily because 
funding is insufficient to support full clinical trials, and, 
as my predecessors on this committee, said, because market 
incentives simply don't exist for this rare pediatric disease. 
With no cure and limited treatment options, children and 
families struggling with EB continue to suffer as they wait and 
hope for cures and treatments that have yet to be developed.
    Waiting and hoping for a cure that may or may not 
materialize is, all too often, the reality for families 
affected by rare and neglected diseases. Because these rare 
diseases affect fewer than 200,000 people in the U.S., and 
because neglected diseases often affect impoverished or 
disenfranchised populations in developing countries, there 
exist significant barriers and very limited market incentives 
for research and for development. Because the unique set of 
circumstances discourage innovation in this field, thinking 
outside the box becomes a necessity.
    I would like to commend Senator Brownback, from Kansas, 
who's been a leader in developing innovative ways to encourage 
research in diseases that lack a large market incentive. 
Senator Brownback and I were successful, 3-plus years ago, 
during the FDA authorization, in authorizing a Priority Review 
Voucher Program that awards a voucher for expedited FDA review 
to any company that obtains approval for a treatment for a 
neglected tropical disease. And we already have begun to see 
the impact of that in tuberculosis and other mostly developing-
world diseases. We're working now to expand that program to 
include rare childhood diseases like EB.
    Another innovative strategy, this one spearheaded by 
Senator Specter, is the Cures Action Network. This grant 
program, authorized under health reform and housed within the 
Office of the Director at NIH, was established for the express 
purpose of helping ensure that treatments and cures for rare 
diseases make it over the finish line when funding for later-
stage research is holding them back. The next step is to fund 
this tremendously promising program so we can realize its 
critical goals.
    Examining solutions like these, as well as barriers to 
research and development, is why we're here today, why I 
appreciate so much Chairman Harkin holding this hearing.
    Witnesses in our first panel will be able to talk about 
current research and development initiatives taking place with 
respect to rare and neglected pediatric diseases. Dr. Goodman 
and Dr. Guttmacher will discuss ongoing efforts at FDA and NIH 
to enhance research and development for rare and neglected 
pediatric diseases.
    And witnesses in our second panel will discuss barriers 
that hamper our efforts to cure and treat these diseases, and 
provide suggestions about how we move forward.
    For instance, I know the National Organization for Rare 
Disorders, NORD, has long advocated for more transparency in 
the regulatory system so that investigators and drug and device 
manufacturers have a better handle on expectations for the 
approval of new products. I know the American Academy of 
Pediatrics has long fought, and continues to fight, to ensure 
that drugs and devices are studied and labeled for pediatric 
purposes. I know the biotech industry is developing some of the 
most effective and innovative treatments for rare pediatric 
diseases, but that attracting sufficient capital for these 
efforts is always a challenge.
    And finally, I'm pleased that Alex and Jamie Silver are 
here today with us. The father of the son with EB, Mr. Silvers, 
fought tirelessly, along with his wife Jamie, to raise 
awareness about this rare pediatric disease. He will be 
offering a number of suggestions to improve private and public 
efforts. I thank him personally for work he's done with my 
staff. I know there's no better advocate than a parent, and I 
appreciate him and the parents here who are working not just on 
behalf of their own children, but for children whom they don't 
even know, and thank them for that.
    Thank you, Mr. Chairman.
    [The prepared statement of Senator Brown follows:]

                  Prepared Statement of Senator Brown

    Thank you, Chairman Harkin. I would like to begin by 
thanking both you and Senator Enzi for working with me to put 
together this important bipartisan hearing.
    There has been a lot of partisanship in the halls of 
Congress recently, but I do not expect partisanship in this 
room today--and that is to the credit of this committee's 
leadership.
    The unfortunate reality is that--whether we're talking 
education, poverty, violence, or health--the well-being of our 
Nation's children is not made a high enough priority.
    While great strides are being made with respect to 
children's health--thanks to Medicaid, the Children's Health 
Insurance Program, and the recently passed health reform 
legislation--there are still areas where our efforts fall 
short.
    One such area is research and development for pediatric 
diseases and conditions.
    Despite the fact that children and adolescents account for 
more than 20 percent of our Nation's population, pediatric 
research by the National Institutes of Health (NIH) accounts 
for a mere 5-10 percent of the total NIH budget.
    Despite the fact that children account for more than 20 
percent of our Nation's population, most drugs on the market 
today have never been tested in children.
    If we are falling short in our efforts to cure and treat 
pediatric diseases and conditions--we are falling woefully and 
inadequately short in our efforts to cure and treat rare and 
neglected pediatric diseases and conditions.
    Seven thousand known rare or orphan diseases afflict nearly 
30 million Americans--approximately 50 percent of whom are 
children.
    Even with millions affected by rare diseases, research 
opportunities remain scarce, approved therapies even scarcer.
    One of these rare diseases is Epidermolysis (ep-uh-derma-
lo-sis) Bullosa (otherwise known as ``EB'').
    EB is a debilitating, disfiguring, and potentially deadly 
skin disease directly affecting approximately 12,000 people in 
the United States, most of them children.
    Because these children are born without the typical anchors 
that hold the epidermal and dermal skin layers together, any 
form of pressure creates unbearable friction and can make the 
simplest of activities--like hugging, playing, or even 
sleeping--calamitous.
    The most common characteristics of EB are chronic 
blistering, ulcers, and scarring.
    Though the genes causing all types of EB have been 
identified, a cure continues to elude the medical community--
primarily because funding is insufficient to support full 
clinical trials and because market incentives simply do not 
exist for this rare pediatric disease.
    With no cure and limited treatment options, children and 
families struggling with EB continue to suffer as they wait--
and hope--for cures or treatments that have yet to be 
developed.
    Waiting and hoping for a cure that may or may not 
materialize is, unfortunately, all too often the reality for 
families affected by rare or neglected diseases.
    Because rare diseases each affect fewer than 200,000 people 
in the United States--and because neglected diseases often 
affect impoverished or disenfranchised populations in 
developing countries--there exist significant barriers and 
limited market incentives for research and development.
    Because of the unique set of circumstances that discourage 
innovation in this field, thinking outside the box becomes a 
necessity.
    I would like to commend Senator Brownback--who has been a 
leader in developing innovative ways to encourage research on 
diseases that lack a large market incentive.
    Senator Brownback and I were successful in authorizing a 
``priority review voucher program'' that awards a voucher for 
expedited FDA review to any company that obtains approval for a 
treatment for a neglected tropical disease.
    We are working now to expand that program to include rare 
childhood diseases--like EB--in that program.
    Another innovative strategy--this one spearheaded by 
Senator Specter--is the Cures Action Network.
    This grant program authorized under health reform and 
housed within the Office of Director at NIH, was established 
for the express purpose of helping ensure that treatments and 
cures for rare diseases make it over the finish line when 
funding for later stage research is holding them back.
    The next step is to fund this tremendously promising 
program so we can realize its critical goals.
    Examining solutions like these, as well as barriers to 
research and development, is why we are here today.
    Witnesses on our first panel will be able to talk about 
current research and development initiatives taking place with 
respect to rare and neglected pediatric diseases.
    Dr. Jesse Goodman and Dr. Alan Guttmacher will discuss 
ongoing efforts at FDA and NIH to enhance research and 
development for rare and neglected pediatric diseases.
    And witnesses on our second panel will discuss barriers 
that hamper our efforts to cure and treat these rare diseases 
and will provide suggestions about how we can move forward.
    For instance, I know the National Organization for Rare 
Disorders (NORD) has long advocated for more transparency in 
the regulatory system so that investigators and drug and device 
manufacturers have a better handle on expectations for the 
approval of new products.
    I know that the American Academy of Pediatrics (AAP) has 
long fought--and continues to fight--to ensure that drugs and 
devices are studied, and labeled, for pediatric populations.
    I know that the biotech industry is developing some of the 
most effective and innovative treatments for rare pediatric 
diseases, but that attracting sufficient capital for these 
efforts is an ongoing struggle.
    And, finally, I am so pleased that Mr. Alex Silver is here 
today.
    As the father of a son with EB, Mr. Silver has fought 
tirelessly to raise awareness about this rare pediatric disease 
and he will be offering a number of suggestions to improve 
private and public efforts.
    I'd like to thank Chairman Harkin and Senator Enzi again 
for their commitment to rare and neglected pediatric diseases 
and I'd like to thank all of our witnesses for taking the time 
today to discuss these issues, which are so close to all of our 
hearts.

    The Chairman. Senator Brown, thank you very much.
    Senator Franken.

                      Statement of Senator Franken

    Senator Franken. Mr. Chairman, thank you for holding this 
hearing on rare and neglected pediatric diseases.
    This is an issue that touches the lives of thousands of 
Minnesotans. I'm looking forward to hearing from our witnesses, 
one of whom has worked at the University of Minnesota.
    Every day, I receive letters from Minnesotans of all ages 
who suffer from rare or under-studied conditions, and that have 
little or no prospect for care. The most heartbreaking stories 
are about kids, children with little-known diseases that have 
been frozen in time. Decades have gone by, and there's still 
been no progress on new treatments. And I also hear the stories 
of kids with conditions that we do have treatments for, but the 
therapies or devices they need aren't covered yet by insurance.
    We need to do more for all of these cases. I'm heartened by 
the progress brought by laws like the Orphan Drug Act and the 
Pediatric Medical Device Safety Act. And I want to thank my 
senior colleagues on the committee who have championed these 
bills.
    Today I'm interested in learning what the next steps are, 
so we can develop treatments more quickly and make sure that 
they reach kids who need them the most. For example, many of 
the humanitarian-use devices now available have come from 
companies with Minnesota ties, a fact that all Minnesotans are 
proud of. But, I'm concerned that we still don't have 
equivalent incentives for devices as we have for drugs. I think 
we can do more, and I look forward to exploring this issue with 
the panel.
    The fact is that, here in Congress, we have lots of 
disease-specific bills that try to bring resources to these 
rare and neglected diseases. These bills are worthwhile, but 
it's a real challenge, because there are thousands of these 
diseases. I believe there has to be a better way to make sure 
our scientific infrastructure and financial incentives produce 
treatments for both prevalent and rare diseases. And I look 
forward to hearing from the panel.
    Thank you, Mr. Chairman.
    The Chairman. Thanks, Senator Franken.
    As I said, we have two panels. The first would be the Food 
and Drug Administration and the National Institute of Child 
Health and Human Development, at NIH. And then, another second 
panel.
    As I mentioned earlier, both Senator Dodd and I have to 
leave, like right now, because of the presidential signing of 
the bill, downtown. And so, I apologize for that. But, I want 
to reassure everyone that your testimonies have been read--I do 
those the night before--and that all of your testimonies will 
be made a part of the record in their entirety.
    I leave you in the good hands of both Senator Enzi and 
Senator Brown and Senator Franken--as you can tell, all great 
champions of this issue, and have a great deal of interest in 
it.
    So, I'm going to have to excuse myself. And I will yield 
the gavel to Senator Brown for the remainder of the hearing.
    [Pause.]
    Senator Brown [presiding]. For the first panel, I would 
like to introduce Jesse Goodman and Alan Guttmacher. I have a 
couple of words in introduction, and then I'd like you to 
proceed for 5 minutes or so, and then, of course, we'll ask you 
questions.
    I'd like to welcome Jesse Goodman from the Food and Drug 
Administration. He's a chief scientist, deputy commissioner for 
science and public health at the FDA, formerly served as the 
director for the Center for Biologics at the Food and Drug 
Administration; and continues to be an active clinician and 
teacher who's board-certified in internal medicine, oncology, 
and infectious diseases. Dr. Goodman's a staff physician and 
infectious diseases consultant at the National Naval and Walter 
Reed Army Medical Centers.
    Alan Guttmacher is our second panelist, acting director of 
the National Institute of Child Health and Human Development. 
He's a pediatrician and medical geneticist. He's also served in 
a number of roles at the National Human Genome Research 
Institutes at the National Institutes of Health, where he 
oversaw the Institute's effort to advance genome research and 
integration of that research into healthcare, an extraordinary 
effort. Dr. Guttmacher is a member of the Institute of Medicine 
and a fellow of the American Academy of Pediatrics.
    Dr. Goodman, if you would proceed.

STATEMENT OF JESSE GOODMAN, M.D., M.P.H., CHIEF SCIENTIST, U.S. 
        FOOD AND DRUG ADMINISTRATION, SILVER SPRING, MD

    Dr. Goodman. Thank you very much, Senator Brown, and good 
morning. And thank you, Senator Enzi and Senator Franken. I'm 
very pleased to be here with you.
    I'm also with members of my team that I'll introduce a 
little later. And I'm happy to be here to talk about FDA's 
efforts to encourage development of medical products for 
children with rare and neglected diseases.
    I do want to send a very--I hope I'll convey a very strong 
message that we're engaged on every front. And I'd like to sort 
of start out with the key message being, I think there are two 
critical ways we can help. One is in a very highly interactive 
science-based review process with sponsors and investigators. 
And the other is through our regulatory science efforts, which 
really are to bring science to bear that can move things across 
this gap, from promising ideas in basic science to products 
that really help people.
    Just to start, as a practicing physician I see, frequently, 
the impacts of these diseases. We've heard some about the 
suffering they cause in children and their families. I like to 
always take the opportunity to remind folks that it's not just 
that these neglected diseases that affect others around the 
world cause tremendous impacts and there are humanitarian 
reasons to face them, but our country, too, is at risk for 
these diseases, as we see with the spread of influenza, 
tuberculosis, etc. So, I would argue that there's both pressing 
humanitarian reasons to act, but also national public health 
and security reasons that we should be on top of infectious 
diseases.
    Now, for both these rare diseases and neglected diseases, 
as has been identified, there's really two big barriers to 
getting products. First is the market incentives that are not 
always clear, as we've heard about. But, second, and not always 
recognized, is, there are some serious scientific challenges in 
translating basic science and getting enough basic science to 
translate ideas and concepts into products.
    For the neglected diseases--and excellent examples are TB, 
malaria, and HIV. Actually, in those areas, despite a lot of 
basic science investment, we still don't have clear answers. 
And part of what makes these diseases so good at infecting 
people is also what makes them so hard to develop vaccines and 
drugs against, which is how they evade the normal host defenses 
and immune response. So, there are scientific needs.
    Now, I want to emphasize FDA's particular role here in 
assuring that products are safe and effective. And I also want 
to say that people with rare and neglected diseases are 
particularly vulnerable, due to either their illness, their 
poverty, etc. So, it's very important that we do our job, and 
be sure these products are safe and effective. People around 
the world, in fact, look to FDA to make the best risk-based 
decisions about medical products.
    Also, I want to really clearly emphasize that if a product 
is promising, FDA wants to work with product developers to help 
that product succeed in the development process. And then if a 
product works, we're going to approve it.
    The essential problem here is that there are simply not 
enough effective products being developed. And so, we want to 
join with you, our colleagues at NIH and elsewhere, and 
industry, to do everything we can to facilitate the development 
of these products. This is a huge task, but we're very 
committed to it.
    Now, as you've heard--and rightfully credited Senator Dodd, 
particularly, with--Congress has helped, in a bipartisan way, 
in this fight against rare and neglected disease. And we thank 
you. And we're pleased to be part of that effort.
    As you've heard, the Orphan Drug Act accomplished a lot. 
Before it, there were very few products for rare diseases. 
Since it, there are 358 approved products. And many of these 
actually do address some of the rarest diseases. But, 
obviously, looking at that, we have a long way to go.
    And I wanted to recognize and introduce to you Dr. Tim 
Cote, who is here and directs our Orphan Product Program. And I 
want to point out that they have a number of activities: a 
large grants program to help people develop products; 
personalized assistance to people in the development process; 
working with patient groups who we think are extremely 
important and can help inform us. They've helped identify drugs 
that could be promising in rare diseases, and put those out 
there for industry and academic interest. We do a huge amount 
of outreach and training, including courses in how to develop 
products for rare diseases in small clinical trials, etc, one 
recently attended, online and in person, by 1,500 people, 
including both FDA reviewers and outside investigators. And Dr. 
Guttmacher will talk more about it. But, we're working very 
closely with NIH, including working with them up front in this 
very exciting TRND program that you'll hear about.
    Now, as Senator Enzi noted, children are not just small 
adults, and we need a lot of data about their diseases. And 
again, thanks to your leadership, we have the Best 
Pharmaceuticals for Children Act and the Pediatric Research and 
Equity Act that work together to help achieve this goal. Before 
these acts were present, 80 percent of products approved had no 
information about pediatric uses, forcing clinicians, 
essentially, to do their best and guess.
    Today, we still have a lot more work to do, but pediatric 
information, as a result, is routinely included in the product 
labeling. And again, part of our team, Dianne Murphy--Where are 
you, Dianne?--is here, and she leads our Pediatric Therapeutic 
Office that coordinates this effort.
    You've mentioned the Humanitarian Device Exemption Program. 
We think this is a creative program. It, again, has allowed 
people--device-makers to target devices to small populations 
and allow their approval based on a probable-benefit standard, 
which provides flexibility to help get these products to 
people.
    And Dr. Barbara Buch, from CDRH, our Device Center, Is she 
here somewhere? Barbara? Hi, Barbara.--is also here, and an 
important part of that team.
    Also, just in February, FDA created a new position, 
associate director for rare diseases in the Drug Center, where 
much of the review activity is located. Anne Pariser is running 
this activity. She's here. I see Anne. This program is to 
really promote best practices and innovation throughout the FDA 
and in collaboration with outside stakeholders.
    Now, I want to also point out that we are fully committed 
to applying flexibility in the development and review of these 
products. That doesn't mean we will necessarily always agree 
with every proposal that every sponsor makes, but we really 
want to be open to those proposals, and be flexible.
    It's really important to point out--and I have details in 
my written testimony--that we've approved quite a number of 
products based on very small clinical trials--10, 20 people--
and often on one trial, where all the information can be 
reasonably applied, and where the product has worked.
    The issue of surrogates, biomarkers, things that can allow 
us to predict effectiveness more quickly, and not have to wait 
for years, in a long-term clinical trial, that's an area 
where--we also are very open to, and I agree with several of 
the other people testifying today, that we can develop the 
science there. I'll come back to that a little.
    Again, as a result of your and Senator Brownback's 
leadership, we have a review going on--new review groups for 
both rare and neglected diseases. And we do look forward to 
gathering all that input and providing Commissioner Hamburg 
with our best ideas and coming back to you with a report.
    Now, on neglected diseases, I want to say, we have seen 
tremendous increase in interest, both from Congress, from the 
American people, from the Administration, from nongovernment 
organizations, from--even from industry on this--in developing 
products that can meet this incredible humanitarian and public 
health need. And we are very excited about that, very engaged 
in it. This was a very high priority for me, when I directed 
the Biologic Center at FDA with all our relationships with WHO, 
and it remains one for me and Dr. Hamburg.
    I'd like to mention a few things we've done in the 
neglected disease area. We've issued a guidance on development 
of vaccines for global infectious diseases. We provide a huge 
amount of technical support and expertise to WHO in their 
efforts to set high standards for the world. We serve as a 
reference national regulatory agency, for WHO, that can approve 
products for their programs, that distribute them throughout 
the world. We're involved with them in trying to build 
capacity, throughout the world, for other regulatory agencies 
so that places like Africa--where there are other developing 
countries--can exercise appropriately their autonomy in looking 
at products, but also can be partners that help those products 
get effectively developed and evaluated. And then we do a lot 
of training for foreign regulators.
    I want to finish up by mentioning our regulatory science 
work. In the area of neglected diseases, we have a very large 
program to develop better measures of safety and effectiveness 
and quality, for example, of vaccines for diseases like HIV, 
TB, malaria, meningitis, Leishmania.
    Now, I want to talk a little bit about our highly applied 
and targeted regulatory science efforts, because most of the 
problems that we find we're dealing with--and the difference 
between success and failure in product development is often 
based on, What is the science we have, and how can we apply it?
    As you know, researchers have defined the genetic basis of 
thousands of diseases. We have all the information from the 
human genome. But, there still is this very persistent and 
troubling gap between all that basic science knowledge and 
product development and products that can benefit people. And 
this is part of the reason we have that gap in getting to those 
products. We believe that, through our regulatory science 
efforts and the kind of interactive review I talked about, we 
can help bridge that.
    This is particularly important for rare and neglected 
diseases. For example, we do want to see more accelerated 
approvals and markers for effectiveness and safety that can 
help us approve products and develop them more quickly. But, to 
do this, you need the science. You have to have endpoints that 
are sound, or we end up with products that are approved and 
then later found not to work, as we've seen occasionally in the 
drug world.
    We're very actively engaged with other partners, through 
consortia, through our own research efforts, in trying to 
develop better surrogate markers for effectiveness. And we 
recently had a TB workshop, just focused on this, that involved 
our colleagues at NIH and CDC, as well as industry.
    Some examples of the success of some of our fairly limited 
but, I think, robust and focused regulatory science program 
includes the work of FDA biochemists that solved a 
manufacturing problem for a meningitis vaccine that is then 
allowing a major NGO to produce meningitis vaccine for much of 
the world, where it's a huge problem. Another thing is work 
that FDA chemists are doing now to better understand how dosing 
forms, like tablets, of drugs are handled by children, and how 
we can improve that. And those are just a couple of examples.
    We thank Congress, and our 2011 budget of the 
Administration includes the first dedicated funding, in fact, 
for FDA to rebuild its scientific infrastructure, and develop 
these kinds of tools that can help turn ideas into products. 
We're also very excited about our new collaboration, led by Dr. 
Hamburg and Collins, our Leadership Council between FDA and 
NIH, and our grant program on applied regulatory science that 
we're doing together.
    And then, to close, I'd like to say that strong science is 
critical in an intensely interactive review process that we 
know improves the chances of the outcome of success. That 
success is good for patients, but also for our economy, where 
our leadership in product development is critical.
    FDA science can and should meet with scientists from 
companies and sponsors early in development, and help identify 
issues and problems, and help to solve them, to increase the 
odds of success. And these interactions are very labor-
intensive for FDA, but we've seen, for example, in our medical 
countermeasure review, a very different subject, but with some 
similarities, that the more we can work with sponsors early on, 
and identify and solve problems, the higher the likelihood of 
success.
    And perhaps my most important suggestion--I make it every 
day to people who call me--is that sponsors seek and engage in 
this kind of approach, meeting with us early, including with my 
colleagues that I identified here.
    Finally, I want to reemphasize that we are really committed 
to this, our leadership and so much of our staff. And we really 
welcome your engagement and ideas.
    Thank you very much.
    [The prepared statement of Dr. Goodman follows:]

          Prepared Statement of Jesse L. Goodman, M.D., M.P.H.

                              INTRODUCTION

    Good afternoon, Chairman Harkin and members of the committee. I am 
Dr. Jesse L. Goodman, Chief Scientist and Deputy Commissioner for 
Science and Public Health at the Food and Drug Administration (FDA), an 
agency of the Department of Health and Human Services. I appreciate the 
opportunity to be here today to describe the role of FDA in encouraging 
and speeding the development of drugs, vaccines, devices, and 
diagnostic tests to improve the lives of children affected by rare 
diseases.
    There are more than 7,000 rare diseases, defined by the Orphan Drug 
Act (ODA) as diseases affecting fewer than 200,000 people in the United 
States, and many of these affect children. Some diseases, such as 
severe genetic diseases, predominantly or exclusively affect children. 
As a practicing physician and a researcher specializing in infectious 
diseases and trained in oncology, I have personally witnessed the 
devastating human face of diseases like these.
    While we have made great progress in addressing this challenge, 
there are still an estimated 20 million Americans suffering from rare 
diseases for which there are no approved therapies available. Factors 
responsible for this are only magnified for children. In many cases, 
and even when the basic scientific problem is understood, the applied 
scientific knowledge is still not there to identify or develop good 
candidates. In addition, market incentives may be insufficient to drive 
the sustained commercial interest and investment necessary to develop 
new medical products for pediatric rare diseases. Furthermore, 
conducting clinical trials to treat this population presents real 
challenges. As with all rare diseases, the number of patients available 
for clinical trials is small, and our knowledge about the history and 
best management of these diseases is often limited. Small populations 
are made even smaller when we consider that diseases and therapies may 
affect children differently at different ages--and not all children are 
the same. A product that is effective in an infant may not work for an 
older child or a teen. In addition, with limited information about rare 
diseases, we may have difficulty determining whether a child's response 
to therapy in a clinical study is related to intervention with a 
medical product or is a result of the natural course of the disease 
over his or her lifetime. Other factors that impact all clinical trials 
in children, such as limitations on the amount of blood that can be 
drawn from a child, also come into play. All of these issues complicate 
progress in this area.
    In the face of these challenges, FDA believes it can contribute 
collaboratively to achieve progress, and we are taking a multifaceted 
approach to supporting the development of medical products for 
pediatric rare diseases. I welcome your shared interest and commitment 
to this issue, and I am pleased to be here today to provide you with an 
overview of our major efforts to enhance the development and 
availability of products that can improve the lives of those affected 
by pediatric rare diseases.
    Congress has empowered FDA with many innovative tools to help 
address pediatric rare diseases. I will begin by providing a summary of 
the statutory authorities under which we are currently conducting these 
efforts, followed by a discussion of other related activities at FDA.

      FDA STATUTORY AUTHORITIES TO ADDRESS PEDIATRIC RARE DISEASES

The Orphan Drug Act
    The 1983 Orphan Drug Act (ODA) created financial incentives, 
including grants, to support the development of new drugs for people 
with rare diseases. Under this system, developers of promising drugs or 
biologics can, prior to submitting applications for approval of those 
products, apply to receive ``orphan drug status'' designation. If 
products so designated are subsequently shown to be safe and effective 
and receive marketing approval, their developers receive market 
exclusivity for 7 years.
    FDA's Office of Orphan Products Development (OOPD) serves as a 
focal point for FDA's efforts to address rare diseases, and can provide 
significant assistance to scientists who may lack product development 
and regulatory experience. OOPD also fosters new approaches throughout 
FDA to advance development of therapies for rare diseases. For example, 
last month OOPD announced the availability of a new tool, the Rare 
Disease Repurposing Database, which identifies drugs that are deemed 
promising for rare illnesses and are already approved by FDA for 
another disease. A novel feature and major advantage of this database 
is that it focuses on drugs that have already gone through the FDA 
approval process. Thus, repurposing of these drugs for a new rare 
disease indication might be attainable quickly, relatively 
inexpensively, and at great benefit to the patients involved.
    ODA has been extremely successful in changing the landscape and 
success rate of orphan drugs and improving the lives of many patients. 
Prior to the existence of ODA, there were few new products for people 
with rare diseases, but, since 1983, more than 2,150 medical therapies 
have been officially designated as ``orphans,'' and 358 of these 
therapies have gone on to full marketing approval. Of these products, 
approximately 67 (19 percent) are for diseases that occur exclusively 
among children and 201 (57 percent) of these are for diseases that 
occur among both children and adults. ODA also established FDA's 
largest grants program, $15.2 million for fiscal year 2010, managed by 
OOPD. Forty-seven products have been found to be safe and effective as 
a result of data generated in part by those grant monies. Of these 
products, approximately 11 (24 percent) are for diseases that occur 
exclusively among children and 28 (62 percent) of these are for 
diseases that occur among both children and adults.
    The approved products now on the market that qualified for orphan 
product designation are a testament to the important accomplishments 
and successes of the program. Success stories include:

     Carbaglu (carglumic acid) for the treatment of NAGS 
deficiency, the rarest of the Urea Cycle Disorders, which are diseases 
that lead to elevated ammonia levels in the blood and cause seizures, 
poor muscle tone, respiratory distress, coma, and even death. NAGS 
deficiency affects fewer than 10 patients in the United States at any 
given time. This drug was approved in March 2010, based on a case 
series in 23 patients.
     Myozyme (alglucosidase alfa) for the treatment of Pompe 
Disease, which is a rare genetic disease resulting in progressive 
skeletal and respiratory muscle weakness caused by an accumulation of 
glycogen (a carbohydrate). About 1,000-2,000 patients in the United 
States suffer from Pompe Disease, of which only a few hundred are 
infants. In infants, the disease can be rapidly fatal due to 
respiratory failure. This drug was approved in April 2006, based on the 
results of a single, pivotal study in 18 patients.
     Ceprotin (Protein C Concentrate) for treatment of severe 
congenital Protein C deficiency, the prevention and treatment of venous 
thrombosis (blood clots in the vein), and purpura fulminans (life-
threatening bleeding and tissue death). The life-threatening form of 
the disease affects about 1 in 500,000 to 1 in 750,000 newborns. This 
drug was approved in March 2007, based on a clinical study involving 18 
patients.
     Kogenate FS (Antihemophilic Factor (Recombinant)) to 
prevent bleeding episodes and the risk of joint damage in children with 
hemophilia A. The disease affects about 15,000 individuals in the 
United States, nearly all of whom are male. This drug was approved for 
this indication in October 2008, based on a clinical development 
program of 65 boys under 30 months of age.

Best Pharmaceuticals for Children Act and Pediatric Research Equity Act
    Under the leadership of Senator Dodd and the members of this 
committee, over the past decade, Congress created and reauthorized two 
critical programs that have dramatically improved the practice of 
medicine for children: the Best Pharmaceuticals for Children Act 
(BPCA), first enacted in 1997 as part of the Food and Drug 
Administration Modernization Act, and the Pediatric Research Equity Act 
(PREA), first enacted in 2003. Together, BPCA and PREA create a 
``carrot and stick'' approach to the development of important new 
safety, effectiveness, and dosing information for medical products used 
in children. BPCA is an incentive program that grants market 
exclusivity to sponsors that elect to study their product in children 
according to protocols set by FDA. PREA gives FDA the authority to 
require pediatric studies under certain conditions. Before these laws 
were enacted, an estimated 80 percent of medication labels did not 
include information about use in children. Without pediatric studies, 
doctors treating children most often have to use medical products 
without important information about correct dosage or safety and 
effectiveness. Today, using the tools that Congress provided with BPCA 
and PREA, we have worked with industry to add new pediatric information 
to the labels of 385 products.
    The Food and Drug Administration Amendments Act of 2007 (FDAAA) 
established the Office of Pediatric Therapeutics (OPT) within FDA's 
Office of the Commissioner. Its primary mission is to ensure access for 
children to innovative, safe, and effective medical products. OPT 
includes four distinct yet interrelated programs to support FDA efforts 
to improve pediatric access to medical products:

     The OPT Ethics Program supports FDA efforts to ensure that 
children are only enrolled in clinical studies which are both 
scientifically necessary and ethically appropriate.
     The OPT Safety Program coordinates the mandated review by 
the Pediatric Advisory Committee of the safety of drug and biologic 
products 1 year after labeling changes, in response to voluntary and 
required pediatric studies.
     The OPT Scientific Activities Program works with FDA 
scientists and reviewers to ensure that pediatric studies are 
rigorously designed and conducted in accord with current scientific 
understanding of such issues as exposure-response and extrapolation.
     The OPT International Program facilitates communication 
and collaboration between FDA and partner regulatory agencies around 
the world as well as other regions, such as Europe.
The Priority Review Voucher Program
    FDA has long had in place a review system to ensure that the most 
critical medical products are reviewed on a priority basis. Priority 
review applications for products that treat life-threatening and 
serious diseases are reviewed in a 6-month period, compared to the 10-
month period for other products. Most products to treat pediatric rare 
diseases are entitled to get this quicker review cycle, which does 
assist in getting needed products to market more quickly
    Thanks to the leadership of Senator Brown and others, the FDAAA 
granted FDA the authority, beginning in 2009, to award priority review 
vouchers to a company that submits and, after review, receives 
marketing approval for a product for 1 of 16 neglected ``tropical'' 
diseases listed in the legislation. While these diseases are not rare 
in the global context, they often affect fewer than 200,000 individuals 
in the United States and are therefore eligible for orphan drug status 
designation. If transferred to apply to a blockbuster drug, the 4 
months of earlier market access available when a priority review 
voucher is redeemed could translate into an incentive worth hundreds of 
millions of dollars. Already, one such voucher has been issued to 
Novartis, for its anti-malarial drug Coartem (artemether, 
lumefantrine). FDA has informed major human pharmaceutical companies 
that also own veterinary medicines that appear promising for neglected 
human diseases that they could qualify for a priority review voucher if 
evaluation for human disease indications supported marketing approval 
for 1 of 16 neglected diseases listed in the legislation.

The Humanitarian Device Exemption Program
    Also included in FDAAA is the Pediatric Medical Device Safety and 
Improvement Act, which expanded the Humanitarian Device Exemption (HDE) 
program. The HDE program provides an exemption from the otherwise 
applicable effectiveness requirements for devices that are designed to 
treat or diagnose diseases or conditions that affect fewer than 4,000 
individuals in the United States per year. To qualify for this 
exemption, certain criteria must be met, including a determination by 
FDA that the probable benefit outweighs the risk of injury or illness 
from use of the device. FDAAA provided an additional incentive for 
development of devices intended for treatment or diagnosis of rare 
pediatric diseases by lifting certain restrictions on charging for the 
device. An example of a device granted an HDE is the adjustable 
titanium rib for children with thoracic insufficiency syndrome, a 
condition where the child's chest cannot support normal growth of the 
lungs or spine. This device prevents the child's body from collapsing 
on itself, allowing for growth and maturation of lungs and spine in 
patients who otherwise might not survive. The inventor, an orthopedic 
surgeon, recognized the need for a device that could be adjusted as a 
child grows.
    FDAAA also established a grants program to fund pediatric device 
consortia that facilitate the development, production, and distribution 
of medical devices for children. These consortia serve to connect 
pediatric medical device innovators with potential manufacturers and 
provide advice and assistance. So far, four consortia have been 
established. Since their inception in October 2009, the consortia have 
assisted in the evaluation and development of more than 50 pediatric 
medical devices, including development of a critical pediatric 
ventricular assist device, which (at least on a temporary basis) 
partially or completely replaces heart function for children with heart 
disease while they await a transplant.

       ADDITIONAL FDA EFFORTS TO ADDRESS PEDIATRIC RARE DISEASES

Establishment of Rare Diseases Director Position Within FDA Center
    Expanding on its commitment to facilitate the development and 
approval of safe and effective drugs for Americans with rare diseases, 
in February 2010, FDA created a position of Associate Director for Rare 
Diseases in the Center for Drug Evaluation and Research (CDER). In 
conjunction with OOPD, the Associate Director for Rare Diseases 
supports collaboration among scientists and clinicians throughout FDA, 
including with the Office of Pediatric Therapeutics, promoting 
scientific and regulatory innovations to help facilitate timely 
development and approval of new treatments for patients with rare 
diseases.

Training and Collaboration to Support Rare Disease Product Development
    Since 2008, FDA has sponsored an annual course designed to teach 
FDA reviewers and other interested clinicians the science of conducting 
and analyzing small clinical trials, which are especially useful for 
testing medical products for pediatric rare diseases. In October 2010, 
FDA will co-sponsor a larger and more comprehensive Annual Rare Disease 
Investigator Training Course, in collaboration with the National 
Institutes of Health (NIH) and the National Organization for Rare 
Disorders (NORD). FDA is planning a series of scientific workshops to 
address important and difficult rare disease research issues, and is 
developing a ``rare disease database'' to establish the natural history 
of rare diseases to assist with planning trials to test rare disease 
therapies. Lastly, FDA is enhancing collaborations to increase 
transparency, share advice, and establish new programs with several 
pertinent organizations, including NORD; NIH's Office of Rare Diseases 
Research, Therapeutics for Rare and Neglected Diseases Program, and 
other NIH Institutes and Centers; patient advocacy groups; academia; 
and the Institute of Medicine (IOM).

FDA Rare and Neglected Disease Review Groups
    Section 740 of the fiscal year 2010 Appropriation Act (Agriculture, 
Rural Development, Food and Drug Administration, and Related Agencies 
Appropriation Act, 2010, Public Law 111-80) directed FDA to establish 
internal review groups to address rare and neglected diseases, to 
report to Congress 1 year after establishing the review groups and to 
issue guidance relating to rare and neglected diseases. To implement 
section 740, in March 2010, FDA established two new expert working 
groups, the Rare Disease Review Group and the Neglected Disease Review 
Group.
    Last month, a meeting was held on rare diseases, at which 26 
speakers provided comments. Those comments will be made available when 
FDA finalizes its report to Congress on March 11, 2011. A similar 
meeting to discuss neglected diseases is planned for September. 
Finally, FDA and NIH are co-sponsoring an IOM study, which began in the 
fall of 2009, to review national policy for rare disease research and 
related medical product regulation. The results and recommendations of 
that study are due at the end of September 2010, and FDA review groups 
will consider the IOM study findings in their ongoing work.

Office of Special Health Issues
    FDA's Office of Special Health Issues (OSHI) serves as a liaison 
between FDA and patients, patient advocates, health professionals, and 
their representative organizations. OSHI staff encourages and supports 
active participation of these stakeholders in forming FDA regulatory 
policy to ensure the Agency's decisions are based upon a full range of 
perspectives. OSHI also is responsible for communicating important 
safety and regulatory information to health professionals and patients. 
This office is a resource to patients with rare diseases who have 
questions about FDA-regulated products or seek access to 
investigational new products. It is also a resource for parents whose 
children are suffering from rare diseases.

The Role of Regulatory Science
    Researchers have now defined the genetic basis of more than 2,000 
rare diseases and identified potential drug targets for many rare and 
neglected diseases. However, a large gap exists between advances in 
basic scientific research and needed applied product development and 
evaluation research, a gap that contributes to the lack of real 
products getting to patients for many such diseases, despite advances 
in basic sciences. This gap can be filled in part through enhanced 
regulatory science, which is the development of tools, methods, assays, 
standards, and models that help speed and improve the development, 
review, and approval of innovative products.
    The President's fiscal year 2011 budget for FDA includes dedicated 
funding for the Agency to strengthen its critical scientific capacity 
to leverage the opportunities provided by 21st-century science and to 
enhance its scientific collaborations. In February 2010, FDA and NIH 
announced a new collaboration on regulatory and translational science 
to help speed the translation of research into medical products and 
therapies, and we see real opportunities in working together to help 
move promising therapies for rare and neglected diseases from concepts 
to realities.
    Through collaboration, FDA will foster new opportunities for 
patients and consumers. Regulatory science at FDA holds great promise 
for bridging the gap in our scientific knowledge about how medical 
treatments impact children specifically and for unlocking their 
potential for children. For example, during the 2009 influenza 
pandemic, FDA's regulatory science work on dosing of the antiviral drug 
Tamiflu (oseltamivir phosphate) in children under the age of 1 year was 
adopted by countries around the world. As another example, FDA 
scientists from the Agency's Center for Biologics Evaluation and 
Research originated a collaborative effort with the National Toxicology 
Program to improve the safety of gene therapies, in order to design 
vectors that can deliver needed curative genes to children with genetic 
diseases, but without the serious risk of malignancy seen in some 
studies.
    Enhanced regulatory science at FDA also is intended to inform and 
strengthen our review processes and interactions. Strong science, 
whether lab-based, clinical, or involving population and statistical 
sciences, is critical in supporting the kind of intensely interactive 
review processes that we know can improve the odds of success in 
product development. This is particularly true for diseases where 
experience is limited or to support product developers with more 
limited experience. FDA scientists can meet with sponsors early in 
product development, even before human studies are planned, to help 
identify and resolve critical issues and provide input on proposed 
development plans. Such meetings, and continued high quality scientific 
interactions, while labor intensive, are particularly critical in 
identifying and resolving scientific issues with respect to products 
for pediatric rare diseases.

                               CONCLUSION

    FDA's multifaceted and collaborative approach to addressing the 
obstacles of product development for pediatric rare diseases has 
resulted in many successes and real progress, but much more work 
remains to be done to meet the tremendous needs of this population. 
Through the statutes already in place, Congress has granted FDA 
important authorities that we have found very useful to help address 
this challenge. In addition, both new initiatives and enhanced efforts 
engaging many FDA components, including in interactive review and 
regulatory support for sponsors, collaboration and training, and in 
regulatory science, are underway to facilitate development and 
evaluation of needed products. We look forward to continuing to work 
with you and our colleagues in the public health arena to address the 
challenges that we face. Thank you again for this opportunity to 
discuss pediatric rare diseases. I welcome your comments and questions.

    Senator Brown. Thank you Dr. Goodman.
    Dr. Guttmacher.

    STATEMENT OF ALAN E. GUTTMACHER, M.D., ACTING DIRECTOR, 
   NATIONAL INSTITUTE OF CHILD HEALTH AND HUMAN DEVELOPMENT, 
                          BETHESDA, MD

    Dr. Guttmacher. Thank you, Senator Brown and Senators Enzi 
and Senator Franken, for your interest in this truly important 
topic, and for the opportunity to testify.
    We appreciate your interest in a topic which is so 
important to the many, many individual children who are 
affected by rare diseases, and to their families.
    I'd like to begin by illustrating this with one of the 
literally millions of stories that really bring home to me, why 
this is an important topic. It's a story of one of my former 
patients, Kevin Hartmann, whom I've known since the day he was 
born, when I became his physician. Kevin is now a young adult 
with Marfan syndrome, an inherited rare disorder that affects 
the body's connective tissue. Perhaps its most serious 
manifestation is that the aorta can become distended and 
stretched so thin that it tears, requiring emergency surgery, 
or even resulting in sudden death, as was the case with U.S. 
Olympic volleyball star Flo Hyman, several decades ago.
    Individuals with Marfan syndrome are usually counseled to 
avoid physical stress to their hearts, as is caused by many 
athletic activities, and must be monitored closely their entire 
lives. Having Marfan syndrome affects both the activity and the 
personality and lives of individuals who have it, even when 
they are children.
    The availability of a medication that could slow aortic 
growth and prevent its tearing would make an enormous 
difference to Kevin and to the many other children with Marfan 
syndrome. When Kevin was a young child, the only such drugs we 
knew of, so-called beta blockers, were not as effective as we 
wished for. However, a few years ago, groundbreaking research 
supported by the NIH showed that another drug, already on the 
market and approved by the FDA for other indications, Losartan, 
dramatically prevented aortic enlargement in a mouse model. 
Therefore, we are quite excited about the potential of an 
ongoing clinical trial, funded by the National Heart Lung and 
Blood Institute at the NIH, comparing Losartan with the beta 
blocker Atenolol to see whether Losartan is also better in 
humans at slowing the speed of aortic enlargement, which would 
make a real difference in the lives of Kevin and other children 
and young adults with Marfan syndrome. Kevin hopes that this 
kind of approach will enable him to avoid the serious surgical 
complications that, for instance, his father had from this same 
condition.
    Many such examples exist across the NIH. Although the NICHD 
supports the bulk of research on child health and development, 
most of the NIH's 27 institutes and centers include pediatric 
research in their portfolios.
    In fiscal year 2009, the last for which we have complete 
data, the NIH funded nearly $3 billion in pediatric research 
from its annual appropriation, and another $500 million through 
the American Recovery and Reinvestment Act. This 2009 funding 
included over $86 million in pediatric grants in the orphan 
drug category.
    Developing and testing drugs in children has long posed a 
particular challenge because of children's particular 
vulnerabilities. The Best Pharmaceuticals for Children Act, or 
BPCA, seeks to address the lack of information on medication 
safety, effectiveness, and dosing in children. The NIH is 
authorized to identify therapeutic gaps in pediatrics and 
support the research necessary to fill them. Led by the NICHD, 
all of the NIH institutes and centers that have significant 
pediatric portfolios contribute funds and expertise to 
implement the BPCA.
    Current projects include a number on understanding and 
treating rare diseases. For example the National Cancer 
Institute's Children Oncology Group is performing five BPCA 
pediatric cancer drug studies. And the NICHD is funding a 
pharmacokinetic and safety study of baclofen to treat 
spasticity in children with cerebral palsy. Our BPCA 
implementation efforts also include training to address the 
dearth of pediatric pharmacologic researchers. In partnership 
with the National Institute of General Medical Sciences, the 
NICHD is now co-funding six postdoctoral trainees in pediatric 
clinical pharmacology.
    Some rare conditions affect individuals systemically, thus 
requiring the expertise of the NIH institutes. One way to deal 
effectively with such situations is a trans-NIH working group. 
For instance, NICHD leads one such effort, the NIH Fragile X 
Research Coordinating Group. Nine participating NIH institutes 
and centers meet regularly to discuss implementation of the 
research plan on Fragile X. Through support from several NIH 
institutes and the private foundations Autism Speaks and FRAXA, 
scientists are testing a compound in healthy adults as a 
potential treatment for Fragile X syndrome. Should the results 
from these adult trials prove promising, the compound will then 
be assessed for pediatric safety and in clinical trials in 
children. Such public/private partnerships can help leverage 
investment and other resources for rare disorders.
    Individually, the NIH institutes and centers are engaging 
in a wide variety of research projects on pediatric rare 
diseases, and a sampling of those projects is included in my 
written statement.
    Established in 1993, the NIH Office of Rare Disease 
Research, or ORDR, helps to coordinate and support these 
activities across the NIH. The ORDR, in collaboration with six 
other NIH institutes, oversees the Rare Disease Clinical 
Research Network, which comprises 10 consortia with more than 
70 sites across the United States. The goals of these sites are 
to make investigational studies and treatments more accessible 
to patients with rare diseases, and to facilitate the 
recruitment of patients for clinical trials. Researchers 
affiliated with the network study more than 40 rare diseases, 
many of them pediatric. The network also targets early-stage 
investigators, to encourage them to focus their careers on rare 
diseases.
    Another new NIH program specifically developed therapeutics 
for rare diseases, including pediatric condition. Launched in 
May 2009, the Therapeutics for Rare and Neglected Diseases, or 
TRND, initiative is a trans-NIH collaborative program, which 
has already been mentioned today. In most cases, a TRND 
investigator will begin with a chemical compound that is known 
to have some biological effect in the laboratory for a given 
rare disease and progress to a candidate compound suitable for 
a new drug application to the Food and Drug Administration. 
And, as Dr. Goodman has referenced, this is one of a number of 
new endeavors where NIH and FDA are increasingly working 
closely together to try to overcome the many obstacles in drug 
development for rare diseases.
    In terms of TRND, often the candidate compound will be 
licensed to pharmaceutical companies for clinical testing, 
permitting the TRND program to remain focused on the more 
scientifically challenging stages of preclinical development. 
Our goal is to derisk development of new drugs for less common 
diseases, to make them more attractive to private companies.
    Among the projects initiated in 2010 is a re-purposing 
project. That is, testing a drug previously developed for 
another purpose, this time for the rare pediatric 
neurodegenerative disease Niemann-Pick Type C.
    Newborn screening is a mainstay for improving the lives of 
many children with rare diseases. It permits referral to 
medical specialists and treatment for numerous pediatric rare 
diseases to occur as soon after birth as possible. The NICHD 
leads NIH efforts to increase the number of rare and common 
conditions for which newborn tests are available through the 
Hunter Kelly Newborn Screening Program, aimed at identifying 
new screening technologies and furthering research on managing 
and treating conditions that newborn screening can detect.
    For families whose children have a rare disorder, obtaining 
a diagnosis can be a devastating process requiring years of 
frustrating effort. For many conditions, even if there is no 
cure, a diagnosis is essential to receive appropriate 
treatment. Together, the ORDR, the National Human Genome 
Research Institute, and the NIH Clinical Center recently 
organized the NIH Undiagnosed Diseases Program. The goals of 
this new program, which sees both pediatric and adult patients, 
are to provide answers to patients with mysterious conditions 
that have long eluded diagnosis, and to advance our basic 
understanding of rare diseases.
    With this breadth of NIH-funded research, and armed with 
new resources such as the Human Genome sequence, we are 
entering an historic era of greater understanding of the 
biology of many rare diseases, and thus, for the development of 
more effective therapies.
    Thank you, again, for the opportunity to testify today, and 
I would be pleased to answer any questions you might have.
    [The prepared statement of Dr. Guttmacher follows:]

             Prepared Statement of Alan E. Guttmacher, M.D.

    Good morning, Mr. Chairman and members of the committee, my name is 
Alan E. Guttmacher, and I am representing the National Institutes of 
Health (NIH), an agency of the Department of Health and Human Services 
(HHS), at today's hearing on pediatric rare diseases. By background, I 
am a pediatrician and medical geneticist and currently serve as Acting 
Director of the Eunice Kennedy Shriver National Institute of Child 
Health and Human Development (NICHD) at the NIH. We appreciate the 
committee's interest in this topic, which is so important to the 
individual children who are affected by rare diseases and to their 
families. A rare (or orphan) disease is generally considered to have a 
prevalence of fewer than 200,000 affected individuals in the United 
States.
    Let me begin by offering a specific example: one of my former 
patients, Kevin Hartmann, has Marfan syndrome. This is a genetically 
inherited disorder which affects the body's connective tissue. 
Individuals with this condition tend to grow extremely tall and thin, 
have unusually lax joints and share certain other physical features. 
One of the most serious issues associated with this condition is that 
the aorta can become stretched so thin that it tears, requiring 
emergency replacement of the aortic root or sometimes resulting in 
sudden death, as was the case with the U.S. Olympic volleyball star, 
Flo Hyman. Individuals with Marfan syndrome are usually counseled to 
avoid physical stress to their hearts or other tissues caused by many 
sports, and must be monitored closely all their lives. Kevin has made a 
terrific video about his life with Marfan syndrome, http://vimeo.com/
12005105.
    Clearly, the availability of a medication that could slow aortic 
growth and prevent tearing would make an enormous, literally 
potentially lifesaving difference to Kevin, his family, and others with 
Marfan. In 2007, a clinical trial began, funded by the National Heart, 
Lung, and Blood Institute (NHLBI) at the NIH and conducted through its 
Pediatric Research Network, comparing two drugs--Atenolol and Losartan, 
which are already on the market--to see if one is better than the other 
at slowing the speed of aortic enlargement. Both of these drugs are 
commonly used to lower high blood pressure, but groundbreaking research 
using a mouse model and published in 2006, supported by several NIH 
Institutes and Centers (ICs), showed that Losartan prevented aortic 
enlargement and other features seen in individuals with Marfan 
syndrome.
    Many such examples exist across the NIH. Although the NICHD 
supports the bulk of research on normal and abnormal child health and 
development, most of the NIH's 27 ICs include pediatric research in 
their portfolios. In fiscal year 2009, the last year for which we have 
complete data, the NIH funded nearly $3 billion in pediatric research, 
with another $505 million for pediatric research from funding under the 
American Recovery and Reinvestment Act. Although the NIH does not 
report specific funding information on rare diseases, it does collect 
and report on the category of orphan drugs; in fiscal year 2009, the 
portion of grants funded by the NIH in the Orphan Drug category that 
was also reported in the Pediatric category was just over $86 million.
    Developing and testing drugs in children has long posed a 
particular challenge, even for drugs used to treat more common 
conditions, because of the vulnerable nature of this population and 
because children change substantially as they grow. The Best 
Pharmaceuticals for Children Act (BPCA), most recently reauthorized in 
2007, sought to redress the lack of information on medication safety, 
effectiveness, and dosing in children through several means. Under the 
act, the NIH is authorized to identify therapeutic gaps in pediatrics 
and support the research necessary to fill those gaps. Led by the 
NICHD, all of the NIH ICs that have a significant pediatric portfolio 
contribute funds and expertise to implement the BPCA. Current co-funded 
projects include many studies on understanding and treating rare 
diseases: the National Cancer Institute's (NCI) Children's Oncology 
Group is performing five BPCA pediatric cancer drug studies, the NHLBI 
is supporting the ``Baby HUG'' trial, aimed at demonstrating whether 
the drug hydroxyurea is effective at decreasing painful crises and 
preventing chronic organ damage in young children with sickle cell 
disease, and the Foundation for the NIH has contributed to NICHD's 
pharmacokinetic and safety study of Baclofen to treat spasticity in 
children with cerebral palsy.
    Some rare conditions affect individuals systemically, thus 
requiring the expertise of several of the NIH ICs. One mechanism used 
at the NIH to deal effectively with such conditions, is the 
establishment of a trans-NIH working group. The NICHD leads one such 
group, the NIH Fragile X Research Coordinating Group. Fragile X 
syndrome (FXS) is the most common inherited cause of intellectual and 
developmental disabilities. Nine participating NIH ICs meet regularly 
to discuss implementation of the Research Plan on Fragile X and 
Associated Disorders, which the group developed with the input of 
outside experts and published in fiscal year 2008. Each goal area of 
the plan is being addressed by grants funded across the member 
institutes. One excellent example is a Phase I trial of a novel drug 
that may effectively compensate for the missing protein in individuals 
with Fragile X; through support from several NIH ICs [the NICHD, the 
National Institute of Mental Health (NIMH), the National Institute of 
Neurological Disorders and Stroke (NINDS)] and the private foundations 
Autism Speaks and FRAXA, scientists at Seaside Therapeutics are testing 
a leading compound in healthy adults as a potential treatment for FXS. 
Results suggest that the medication is safe and tolerable; a Phase II 
clinical trial study of dosage and efficacy in adults with FXS is 
planned. Should the results from these adult trials prove promising, 
the compound will be assessed for pediatric safety and clinical trials 
in children. Such public-private partnerships can help leverage 
investment and other resources for rare disorders for which no 
treatment is currently on the market.
    Individually, the NIH ICs are engaging in a wide variety of 
research projects on pediatric rare diseases. Established in 1993, the 
NIH Office of Rare Diseases Research (ORDR) helps to coordinate and 
support these activities across the NIH and to provide information to 
the research and patient communities about these conditions, potential 
treatments, and ongoing research opportunities. Among other activities, 
the ORDR, in collaboration with six other NIH ICs, oversees the Rare 
Diseases Clinical Research Network, which comprises 10 consortia with 
more than 70 sites across the United States. The goals of these sites 
are to make investigational studies and treatments more accessible to 
patients with rare diseases, and to facilitate the recruitment of 
patients for clinical trials. Researchers affiliated with the Network 
study more than 40 rare diseases, many of them pediatric, such as 
intellectual and developmental disorders, rare bone marrow failure 
conditions, and rare pediatric liver disease. Many Network members are 
testing the safety and efficacy of new therapeutic agents, including 
pediatric therapeutics. For example, the NINDS supports several of the 
research consortia within the Network, including the Inherited 
Neuropathies Consortium and the Lysosomal Disease Network, both of 
which include research on disorders affecting children. The Network 
also is targeting early stage investigators to encourage them to center 
their careers in rare diseases; in September 2010, the Network and the 
NIH Clinical and Translational Science Awards (CTSAs) are cosponsoring 
a conference to teach new researchers and junior faculty about rare 
disease research methodology.
    Another new NIH program is aimed specifically at the issue of 
development of therapeutics for rare and neglected diseases, including 
pediatric conditions. Announced in May 2009, the Therapeutics for Rare 
and Neglected Diseases (TRND) initiative is a trans-NIH, collaborative 
program overseen by ORDR and administered by the National Human Genome 
Research Institute (NHGRI). TRND investigators will begin with a 
chemical compound that is known to have some biological effect in the 
laboratory on a given disease, and progress to a candidate compound for 
a new drug application to the Food and Drug Administration. Often, the 
candidate compounds will be licensed to pharmaceutical companies for 
clinical testing, permitting the TRND program to remain focused on the 
most scientifically challenging stages of preclinical development. The 
goal is to ``de-risk'' development of new drugs for less common 
diseases to make them more attractive to private companies. At the same 
time, this innovative program will advance the entire research 
enterprise by allowing open dissemination of the information learned 
during the initial testing phases, expanding the overall research base 
and potentially shortening the time period for the development of new 
drugs. Among the new projects initiated in 2010 is a mid-stage ``re-
purposing'' (testing a drug developed for another purpose) project for 
the rare pediatric condition, Nieman-Pick Type C (NPC), a neurodegen-
erative disease. As will be true of many of TRND's efforts, this 
project is a collaboration of government, academic scientists, and 
patient advocacy groups.
    In addition to the research activities already mentioned, a 
sampling of the types of research across the NIH illustrates the range 
of basic to clinical research activities underway and also provides a 
sense of why therapeutics for some pediatric rare conditions remains so 
elusive.

     The NCI's Childhood Cancer TARGET Initiative is a public-
private partnership developed to harness the power of cutting-edge 
genomics technologies to identify valid therapies for childhood cancers 
rapidly. The program's initial focus was on neuroblastoma and acute 
lymphoblastic leukemia (ALL) but was expanded with ARRA funds to 
include several other conditions. As a result of TARGET, there will be 
a virtually complete catalogue of gene mutations and other gene 
alterations that occur in these childhood cancers.
     The Children's Oncology Group (COG) develops and 
coordinates cancer clinical trials at over 200 member institutions 
throughout the United States and around the world. Through the COG 
network, children with cancer can access state-of-the-art therapies 
regardless of where they live. One of the many consortia of 
investigators within COG, the Pediatric Brain Tumor Consortium, aims to 
rapidly conduct phase I and II clinical evaluations of new therapeutic 
drugs, biological therapies, and radiation treatment strategies for 
children.
     The National Eye Institute has sponsored research that 
provides health care professionals with improved prognostic indicators 
and treatments options for retinopathy of prematurity, a blinding 
disease that affects premature infants. The Early Treatment for 
Retinopathy of Prematurity study demonstrated that therapy administered 
in the early stages produced far better outcomes than traditional 
timing of treatment. The study also resulted in an improved risk 
assessment model to identify those infants at highest risk for 
developing severe vision loss.
     In addition to its research on rare pediatric genetic 
diseases, such as cystic fibrosis, sickle cell disease, thalassemia and 
hemophilia, which has resulted in many individuals with these 
conditions living into adulthood, the NHLBI also supports research on 
rare acquired pediatric diseases. For instance, the NHLBI funded the 
development of recombinant surfactant to improve the lung function of 
the children with bronchopulmonary dysplasia, a serious lung condition 
that primarily affects children who received oxygen therapy when they 
were premature neonates.
     Medulloblastoma, the most common form of pediatric brain 
tumor, is relatively responsive to traditional cancer treatments 
(surgery, chemotherapy, and radiation), but long-term survivors often 
suffer from life-long developmental, behavioral and cognitive 
disturbances. Investigators supported by the National Institute on 
Aging are working to understand the basic mechanisms underlying 
medulloblastoma, so novel treatments can be developed to target tumor 
cells specifically, without damaging the developing brain.
     The National Institute of Allergy and Infectious Diseases 
(NIAID) conducts and supports a broad portfolio of basic, 
translational, and clinical research on primary immune deficiency (PID) 
diseases. PID diseases, such as DiGeorge syndrome, Hyper-Immunoglobulin 
E syndrome, and Severe Combined Immunodeficiency (SCID), are rare 
genetic diseases that lead to recurring, often life-threatening 
infections in affected individuals. Among other research-related 
activities, the NIAID-supported Primary Immune Deficiency Treatment 
Consortium is a multi-center collaborative network focused on studying 
children with PID diseases and the treatment, with hematopoietic stem 
cell transplantation, of these diseases.
     Epidermolysis bullosa (EB) is a group of rare, inherited 
blistering conditions. Recessive dystrophic EB (RDEB) is a particularly 
severe form of the disease, with debilitating, chronic wounds of the 
skin, mouth, and esophagus. Researchers supported by the National 
Institute of Arthritis and Musculoskeletal and Skin Diseases (NIAMS) 
have succeeded in healing wounds in a mouse model of this disease by 
injecting the mice with RDEB patient cells in which the gene defect has 
been corrected. This approach may be useful in developing therapies for 
RDEB. On another front, the NIAMS helped to establish the Childhood 
Arthritis and Rheumatology Research Alliance, a nationwide network of 
pediatric rheumatologists. The group is completing a clinical study of 
the effects of statins (drugs used to lower ``bad'' cholesterol) 
against fat buildup in the blood vessels of children with lupus, which 
could lead to preventive treatments for these pediatric patients.
     Recurrent respiratory papillomatosis (RRP) is a disease in 
which non-cancerous tumors grow in the air passages leading from the 
mouth and throat into the lungs. The tumors may grow quickly, requiring 
surgical removal to prevent blockage of the respiratory tract and 
suffocation. Caused by a virus possibly contracted during childbirth, 
the tumors often recur, requiring additional surgeries. Researchers 
funded by the National Institute on Deafness and Other Communication 
Disorders are exploring whether the use of a common anti-inflammatory 
drug may delay or prevent the recurrence of these tumors, as well as 
examining the genetic makeup of individuals of those who are exposed to 
the virus but do or do not develop RRP.
     In the early 1960s, the life expectancy of a child born 
with cystic fibrosis (CF) was just 10 years; current life expectancy 
for individuals with CF has almost quadrupled to 37 years. The 1989 
discovery of the CF gene by now-NIH Director Francis Collins opened 
important windows into understanding the CF disease process, and 
suggested potential therapeutic approaches. While there is, as yet, no 
cure for CF, ongoing research provides hope for continued improvement 
of medical care for CF. Scientists supported by the National Institute 
for Diabetes and Digestive and Kidney Diseases recently developed a pig 
model of the disease, which provides an important tool for testing 
therapeutic strategies. New medications are currently in development, 
including one which may provide a protein for patients with some 
versions of the gene, and others to improve the salt-water balance in 
people with CF to enable them to clear mucus from their lungs.
     Understanding environmental exposures that can lead to 
clinical disease is critical to the prevention of those diseases or 
development of therapies to treat them. For example, investigators 
funded by the National Institute of Environmental Health Sciences are 
studying cognitive and motor development related to prenatal exposure 
to organophosphate pesticides in 3- to 9-year-olds. The study is 
evaluating the effects of these exposures on brain structure, 
metabolism, and connectivity among regions of the brain, and assessing 
attention deficit hyperactivity disorder, pervasive developmental 
problems and sleep disorders in these children.
     To build on new opportunities made possible through gene 
discoveries and other basic science advances, the NINDS supports 
translational research programs to develop therapies for spinal 
muscular atrophy, muscular dystrophies, and other rare pediatric 
neurological diseases. Some of these therapies are now entering early 
clinical trials, and a new clinical trials network that will help 
expedite such research for these disorders is underway. In May 2010, 
the NINDS and the NIAMS launched a 5-year natural history study of 
Duchenne muscular dystrophy, which aims to validate non-invasive 
approaches to monitor the progression and treatment of this disease, 
with the potential to facilitate the development of promising new 
therapies.

    For many parents whose children have just been diagnosed with a 
rare condition, it is difficult to find reliable information about that 
condition. The Genetic and Rare Diseases Information Center (GARD) was 
created in 2002 by the NHGRI and the ORDR to help people find useful 
information about these diseases by providing timely access to 
experienced information specialists who can offer information on what 
research is being conducted, what genetic testing services are 
available, and which patient advocacy groups to contact for a specific 
rare or genetic disease (see http://rarediseases.info.nih.gov/GARD). 
Genetics Home Reference is a free online health resource from the 
National Library of Medicine (NLM). It is designed to give patients, 
families, and caregivers basic information about genetic conditions and 
the genes or chromosomes related to these conditions. This Web site 
includes summaries of more than 500 rare genetic disorders, many of 
which directly affect the health of infants and children. The site also 
provides background materials to help the public understand the 
significance of genetic disorders and newborn screening. Genetics Home 
Reference is available at http://ghr.nlm.nih.gov.
    For many families whose children have a rare disorder, even 
obtaining a diagnosis can be a devastating process taking years of 
frustrated effort. For many conditions, a diagnosis can be essential in 
allowing the patient to receive appropriate treatment, even if there is 
no cure. Early treatment or other intervention can often ameliorate the 
full impact of the disease. The NIH is taking steps to expand 
scientific knowledge around rare diseases and diagnoses.
    Together, the ORDR, the NHGRI, and the NIH Clinical Center recently 
organized the NIH Undiagnosed Diseases Program. Using a combination of 
the extensive scientific and medical expertise available at the NIH, 
the twin goals of this new program are to provide answers to patients 
with mysterious conditions that have long eluded diagnosis, and to 
advance medical knowledge about rare diseases. Any patient, whether a 
child or adult, with an undiagnosed medical condition can be referred 
by his or her physician for possible evaluation in the program.
    Genetic screening shortly after birth permits referral to medical 
specialists and treatment for pediatric rare diseases to occur as soon 
as possible. Starting in the 1960s, with a screening test for a rare 
disorder (phenylketonuria, or PKU), a majority of States now screen for 
29 conditions. The NICHD is leading research efforts to increase the 
number of genetic tests for a wide range of rare and common conditions 
through the Hunter Kelly Newborn Screening Program, formally 
established in 2009 to honor the son of National Football League Hall 
of Fame quarterback Jim Kelly, who died in 2005 of Krabbe disease, a 
rare, fatal genetic disorder affecting the nervous system. The NICHD 
program is aimed at identifying new screening technologies and research 
on managing and treating conditions that newborn screening can detect.
    Because most conditions targeted by newborn screening are rare, 
large sample sizes are needed for research, and standard coding and 
terminology are required so data can be compared and pooled across 
State jurisdictions. In collaboration with other HHS agencies, the NLM 
created a Newborn Screening Coding and Terminology Guide, a free online 
resource that provides guidance to promote efficient electronic 
exchange of standardized newborn screening data. The goal is to 
encourage widespread use of these national data guidelines for 
transmitting newborn screening results to support the creation of 
regional and national data registries that will be used for detection, 
prevention, and treatment of rare conditions that affect the pediatric 
population, and facilitate more timely diagnosis and follow-up in the 
medical home.
    Research on pediatric rare diseases, and future breakthroughs, are 
dependent on the interest and expertise of well-qualified scientists. 
In addition to the NIH's ongoing research training and career 
development programs, the NIH's Office of Science Education, in 
collaboration with ORDR, has developed a science education module for 
middle schools focused on medical genetics and rare diseases such as 
Marfan syndrome, childhood leukemia, and flesh-eating bacteria. After 
taking the lessons, students will have investigated what constitutes 
scientific evidence, will understand the fundamentals of inheritance 
and learn that this explains why some rare diseases are more prevalent 
in some groups than others, and will understand that many people with 
rare diseases can lead meaningful lives and should not be stigmatized. 
This curriculum will be available in September and free to teachers, in 
the hopes that it will engage young people on these topics and catalyze 
their thinking about choosing scientific careers.
    With this breadth of NIB-funded research, and armed with such new 
resources as the human genome sequence and approaches such as the TRND 
program, we are poised for an era of greater understanding of the 
biology of many rare diseases and thus, more effective therapies. Thank 
you for the opportunity to present today, and I would be pleased to 
answer any questions you may have.

    Senator Brown. Thank you, Dr. Guttmacher.
    The testimony from both of you really underscores the 
importance of coordination in research. Senator Bond and I 
introduced legislation to create a nationally coordinated 
research network to pursue new treatments and cures for 
childhood diseases, the Pediatric Research Consortia 
Establishment Act, based in part and modeled after the highly 
successful NCI sort of efforts to coordinate.
    And in light of that, I'd like to ask--starting with Dr. 
Gutt-
macher--a concern I've heard a number of times is, ``The 
current research environment does not include adequate 
incentives to encourage better sharing of information among 
researchers.'' And I think that's especially a problem on rare 
pediatric diseases, where the population base is so small, and 
collaborative efforts are that much more important for learning 
more about diseases, making that lack of cooperation and 
coordination and sharing especially troublesome.
    Talk to me about what steps NIH is taking to make sure that 
important research into rare pediatric diseases is made more 
widely available among researchers in the scientific community.
    Dr. Guttmacher. You raise several very important issues. 
One of them is this question about cooperation, collaboration 
in scientific research. And I think, in some ways, the most 
fundamental advance that we've made in scientific research in 
the last decade is changing the culture of scientific research. 
The Human Genome Project, which has been mentioned previously, 
and for which the Congress should be justifiably proud for 
funding it and really sparking it, in many ways, many people 
make the obvious sort of observation that the reason for doing 
this was to sequence the human genome. That was the reason for 
doing it, but I would argue that its most fundamental 
contribution to science has been helping to change the culture 
of science.
    A fundamental aspect of that program was that, every 24 
hours, all of the research data developed was made publicly 
available for anyone who had a computer and paid their 
electricity bill, and therefore, could download the data. That 
has been instrumental, along with a number of other advances, 
in changing the culture to say that data that's derived in 
biomedical research, particularly biomedical research that's 
funded by the Federal Government, does not belong to the 
principal investigator, it belongs to society, and that we need 
to come up with ways to encourage collaboration, to make 
research data available not just to the person who developed 
it, but to the entire research world.
    This is particularly important, this cultural change, when 
we talk about rare diseases. Because there will be a relatively 
small group of researchers involved in these diseases, it's 
particularly important that they work collaboratively to tackle 
this.
    I think it also has caused the NIH to think of new and 
creative ways to work across the silos that are the NIH 
institutes too often. NIH institutes were founded for various 
reasons, but today's science tends to go to looking at the 
basic sort of biological causation of disease, and that does 
not observe the silos that we happen to have at NIH. So, NIH 
has come up with many ways to make sure that we fund creative 
research that goes across the traditional boundaries that we've 
had, which, again, is particularly important, I think, when we 
talk about both pediatric research and rare disease research, 
let alone the combination of the two.
    Senator Brown. Thank you.
    Dr. Goodman, you mentioned, in your opening statement that 
conducting clinical trials for rare pediatric diseases, 
presents particular challenges. Our second panel's witnesses 
will talk about the need to ensure that requirements for 
clinical trials are stringent enough to provide reasonable 
assurances of safety and efficacy, but also take into account 
that patients with rare diseases might be--and, I think, are, 
in many cases--willing to accept higher levels of risks than 
other patients might be willing to do. So, speak to that issue 
for a couple or 3 minutes, if you would.
    Dr. Goodman. Yes, I think--this is a very important point--
I think, not just in pediatrics, but, I will say, quite 
generally, the clinical trial enterprise and developing the 
clinical information we need to develop products in this 
country is very threatened. And it's a whole other subject that 
I think we could spend a lot of time on.
    With respect to clinical trials in general, we do look at, 
and we must look at this, in a risk-benefit manner. Obviously, 
the equation of what could go on, and at what point in a 
product's development, really depends on, What are the 
available treatment options for that individual? What do we 
know about the product? So, we approach looking at proposed 
clinical trials in very much of a risk-based manner. We've 
recently made it possible to test compounds, certain compounds, 
where appropriate, earlier in individuals. We had a number of 
initiatives to increase access to investigational therapies, 
where appropriate. So, we're really behind this.
    I would also say there's a whole science behind clinical 
trials. And I think we need--we are moving, as part of both 
personalized medicine and as we incorporate genomic information 
into clinical studies, from very--the necessity for very large 
trials that might observe a benefit only in a proportion of the 
population, to much more targeted trials that can be much more 
efficient and effective. And we're developing science around 
how to analyze data from much smaller numbers of patients to 
reach conclusions.
    So, I think there's a lot of promise in this area, but 
there's a lot of need. Bottom line: we do look at what patients 
need and the specific product and trial in mind when they come 
to FDA.
    Senator Brown. Thank you, Dr. Goodman.
    Senator Enzi.
    Senator Enzi. Thank you, Mr. Chairman.
    And I do have a number of questions, for both of you, which 
I won't have time to be able to do this morning. So, I will 
submit a number of the more technical ones in writing, and 
would hope that you would respond on them. It will be helpful 
as we proceed on this.
    But, I'll begin with Dr. Goodman. I like the idea of these 
NIH and FDA initiatives linking up to cover the span of product 
research, development, and then commercialization. It seems 
that the baton is passed well from initiative to initiative, 
but are there any gaps?
    Dr. Goodman. Yes. I think there are huge gaps. And 
essentially, there's been a--the academic and basic science 
enterprise has been a very distinct one with a distinct culture 
and in distinct locations, and it's very different from the 
product evaluation and development and manufacturing 
enterprise, where industry and FDA are major players. And I 
think one of the things we really want to look at in our new 
NIH/FDA partnership--and frankly, we've been doing, in targeted 
areas--is how we can identify the biggest opportunities to fill 
that gap and increase the success of the enterprise.
    So, I would say, in general, there are many gaps there. 
And, as I mentioned, there are also scientific gaps. How do we 
move an idea for a product, or something in an academic 
laboratory, into a product we can safely give people, study and 
understand its safety and effectiveness.
    What we want to do is not try to do everything--we'd love 
to do everything, but obviously there are resource 
constraints--but, identify, where we can, where we can bridge 
this gap to really meet the needs of our medical system, public 
health, and also of these terrible needs of patients with rare 
diseases. So, we're very interested in doing that. A lot of it 
is about how we do things and how we work together.
    Senator Enzi. Thank you.
    Dr. Guttmacher, how has the NIH Common Fund improved the 
Agency's ability to fund research on rare and neglected 
diseases? And what about pediatric research?
    Dr. Guttmacher. Sure. I think, Senator Enzi, that's a 
wonderful example of this very problem that I was mentioning 
before of following the way that's--scientific discovery goes 
these days, which is across the traditional divisions that 
we've had between and among NIH institutes. The Common Fund 
allows us to approach biological issues in a more creative kind 
of way, to have funding that can look at the various 
manifestations.
    What happens with many rare diseases is that they are 
multisystem diseases, so that, while one NIH institute, 
historically, may have taken the lead in working with that 
disease, it's very important that the community of researchers 
involved in that disease come from very different perspectives, 
very different disciplines. And the Common Fund allows a form 
of funding that really is better, often, at bringing these 
somewhat large and very broad teams together to look at 
diseases.
    One of the rare diseases I've had a particular research 
interest in, myself, is one called hereditary hemorrhagic 
telangiectasia. It's even rarer to find someone who can spell 
it. But, it's a rare disease, and that's one that affects the 
lungs, the brain, the skin, the GI tract, etc. So, I know full 
well, from my own experience, that it's been important to come 
up with ways to fund research that goes across many areas. And 
the Common Fund has been a very good mechanism for doing that.
    Senator Enzi. Good. How many therapies or research projects 
will the Agency be able to conduct and complete with the $24 
billion? On average, how much is necessary to--and I realize 
averages don't work very well--but how much, on average is 
necessary to successfully develop a candidate compound that's 
ready to be tested in patients and licensed to the private 
sector?
    Dr. Guttmacher. To some degree, we don't yet know the 
answer to that question. And that's because both--that the 
costs do vary significantly, depending upon exactly what 
compound you're looking at and what disease you're looking at. 
But also, part of what the TRND program is trying to do is to 
come up with some new processes for going through these steps 
in developing new medications. And so, it's both an experiment, 
in terms of finding some new therapies, but also an experiment 
in seeing if we can't do the process somewhat more efficiently 
than has been done historically.
    We're hoping that--to get to that stage in drug 
development, it will cost somewhere, we would suspect, between 
$5 million and $8 million per compound. But, we don't really 
know until we have enough of them out of the pipeline.
    Senator Enzi. OK. Thank you.
    And my time is expired.
    Senator Brown. Thank you, Senator Enzi.
    Senator Franken.
    Senator Franken. Thank you, Mr. Chairman.
    Thank both of you gentlemen, for your testimony.
    And this is to both of you. There seems to be significant 
differences between the incentives for developing orphan drugs, 
on the one hand, and humanitarian-use medical devices, on the 
other. Could either, or both, of you please comment on these 
differences?
    Dr. Goodman. Yes. Well, I think, you know, we do operate 
under the laws that we have. And, you know, I would say it's 
good that it has been recognized that devices intended for 
small populations and rare diseases face some of the same 
economic and development challenges that drugs do. This is 
recognized in the humanitarian device legislation. I think it's 
good that that's recognized. And it is having an effect. We're 
seeing--I think there's been about 50 devices approved under 
the humanitarian device exemptions. So, that's good.
    Drugs and devices are different, so it's understandable 
that you have some differences in this legislation. But, I 
would say, many of the challenges are the same.
    Senator Franken. What are some differences that you see? 
For example, I know that a drug developed under this system has 
a long life, and so the patent on it is valuable.
    Dr. Goodman. Right.
    Senator Franken. But, the devices tend to have a shorter 
life. So, that's a difference, isn't it?
    Dr. Goodman. That's right. One of the very exciting and 
interesting things about the device development process is they 
tend to be frequently improved. There's a lot of innovation 
around engineering and technology.
    Senator Franken. So, you don't have quite the same 
incentive there.
    Dr. Goodman. So, the----
    Senator Franken. I'm trying to find----
    Dr. Goodman. Right. And the original approval paradigms are 
different, so that, for example, the major incentive in the 
orphan program, of the additional exclusivity, is not applied 
to devices. So, I think that's definitely one difference there.
    Senator Franken. I'm proud that many humanitarian-use 
devices have been generated by companies with Minnesota ties. 
But, I think they could do more, under the right conditions. 
I'd like to ask GAO to look into this issue further and do a 
thorough analysis of how the incentives in the drug industry 
compare to those in the device industry. We need to make sure 
that we're doing all we can to get devices to the kids who need 
them. I'll be following up with the GAO shortly to pursue this 
question. And I look forward to revisiting the issue with the 
committee.
    Dr. Guttmacher, I'm sorry, I want to ask you a specific 
question. I was pleased to work with Senator Brown to request 
appropriations for research on epidermolysis bullosa, which is 
a terrible genetic--skin disease that affects about 30,000 
Americans, mostly children. But, in reality, we can't do a 
separate request for each disease.
    In Congress, we hear from many groups advocating or 
progress on rare disease--parents, family members, and patients 
themselves. And there are a lot of disease-specific bills to 
advance research on these rare conditions, which is difficult, 
because there are really so many of them--really thousands.
    Would you agree that we need more of an overarching plan 
for rare and neglected diseases, to enable the basic science 
and clinical research for these diseases? And, if so, what do 
you think that would look like, or should look like?
    Dr. Guttmacher. I think we already have some elements of 
such a plan, and I think it is the way to approach this. 
Because, what one really wants to be able to do is to follow 
the scientific opportunities, the ones that are most likely to 
be able to make advances. And sometimes, particularly when 
one's talking about basic science, you're not even exactly sure 
where it's going to lead--what disease it's going to have an 
impact on, for instance.
    So, I think having both funding and programs in place, it 
allows one to look broadly across rare diseases. Many rare 
diseases do have relationships to others so that sometime one 
can make an advance in one area that also goes to benefit 
another. I think that one needs to follow the scientific 
opportunities.
    I think, also, though, that there, increasingly, have been 
partnerships between, for instance, the NIH and various 
specific disease advocacy organizations and groups, looking at 
creative ways together, and moving forward research in that 
area. That can be very important, not simply in terms of 
providing resources, though that is helpful, but also often 
bringing together communities of researchers who may not be 
paying attention to a specific disease. The public advocacy 
groups, the patients themselves, in working in concert with the 
NIH and the FDA, can often make real progress that neither 
could make by themselves. Sometimes these programs, and often, 
simply relationships, and having discussions, and making sure 
that one is getting the perspectives of multiple groups 
involved in doing it.
    Senator Franken. Yes.
    Dr. Goodman. I'd like to add an example to that, if 
possible. One of the things we can do, and we've done with our 
colleagues at NIH--it's involved patient groups, product 
developers--is where we see an area where the science isn't all 
there yet, but there's a lot of interest, there's a lot of 
innovation. People have new products.
    We will frequently hold workshops that essentially bring 
all the developers together, all the scientists--basic and 
applied, the clinicians--and say, you know, ``What is the best 
approach to moving this field forward?'' For example, we've 
done this in a number of areas of stem cells. So, if we want to 
investigate stem cells for cancer, for heart disease, for 
replacing insulin in diabetes, to get islet cells, for example. 
What are the things--build in, up front--What are the things 
we're going to need to know at FDA? What are the tools the 
scientific community needs and the issues they need to resolve 
to say, ``Does this work? Can we make this product in a way 
that can be a real product that helps people?''
    So, we have quite a number of these workshops that advance 
this applied science that really bridges to get the products to 
patients. And, you know, I think we need to be much more 
strategic, and have that be our normal practice, rather than 
the exception.
    Senator Franken. Thank you.
    Senator Brown. Thank you, Senator Franken.

                       Statement of Senator Casey

    Senator Casey. Thank you very much.
    I want to thank Dr. Goodman, Dr. Guttmacher, for your 
testimony and for the work you do on so many of these issues.
    I also want to thank both Senator Brown, Senator Enzi, and 
especially Senator Brown, for calling this hearing and 
highlighting all of the challenges that we face when it comes 
to these diseases and the strategies that we employ to deal 
with so many difficult issues here.
    For me and for, I think, a lot of Members of Congress, we 
can't go through a week, or sometimes even a day, without being 
both informed and inspired by constituents who come to us with 
a problem, or sometimes more than one problem, and they give us 
ideas about how to solve it or how to deal with a particular 
problem. Senator Specter and I had a visit, going back a number 
of years ago, from the mother of Nino Todaro. And Nino's mom, 
Lori, was what every child should have, a passionate advocate 
for her son. And in this case, he had the blessing of a 
wonderful mother, who was a fierce advocate on his behalf, and 
also the blessing of medical technology and all of the wonders 
that come with that.
    But, the problem he had was that even though the NIH was 
treating him for his illness, a rare disease known as, periodic 
fever syndrome--and he was getting that treatment--the problem 
was that after his treatment at NIH ended, the treatment was 
then denied by his insurance company because it was, 
``experimental.''
    And so, Senator Specter and I introduced Senate bill 406, 
which would deal with that kind of gap that a lot of families 
and children have to deal with everyday.
    So, I'd ask you about that basic problem, where you have 
treatment and progress made for an individual or a group of 
individuals--in this case, children--and then you have that gap 
because their treatment is considered experimental.
    Then I want to ask a second question, in the limited time 
that I have, about antibiotics. We have had spectacular success 
with infant mortality in the United States going from 20 
percent in the 19th century to under 1 percent in the most 
recent number I have here, which is 1998. But, you have 
antibiotic strategies that are then adversely impacted when you 
have resistance built up.
    So, can you speak to both of those issues? What's the 
strategy for making sure that when resistance is built up, you 
have a strategy to deal with that kind of resistance, No. 1? 
And No. 2, is the type of investment that has to take place to 
deal with that basic problem. I know that's a lot, and you've 
got a minute and 40 seconds to do it. But, we'll try to revisit 
it if your time gets short. We can do it on the second round.
    Dr. Guttmacher. I think, to address the issue of antibiotic 
resistance, there are two major steps. One is to make sure the 
antibiotics are being used appropriately. One of the real 
reasons for antibiotic resistance is through inappropriate 
overuse of antibiotics, whether they be in humans or in other 
animals. So, one real way to prevent it is to use antibiotics 
when indicated, and not at other times, because the more widely 
they're used, the more resistant strains you're going to 
develop.
    The other one, of course, is to try to move more quickly 
than the bugs do; that is, to advance, in terms of new drugs, 
more quickly than the various bacteria are able to evolve to be 
resistant to the old ones. And that's going to be--no matter 
what else we do--it's one of the major reasons why we need to 
develop new antibiotics, because old ones do tend--not all--
but, they do tend to develop--or, strains develop resistance to 
them. So, I think it's both a question of use and in terms of 
development of new antibiotics.
    Senator Casey. But new investments are needed here?
    Dr. Guttmacher. New--I think, clearly, as in the rest of 
developing pharmaceuticals, whether it's antibiotics or other 
pharmaceuticals, it takes investment, in terms of both basic 
research and then also more translational applied research, to 
be able to do it.
    Senator Casey. Dr. Goodman, any thoughts?
    Dr. Goodman. Well, I have a lot of personal interest here, 
and passion about it. When I was at the University of 
Minnesota, we had a very strong program in how we used 
antibiotics in trying to reduce development of resistance. So, 
I agree with Alan that how we use antibiotics, in human use and 
agriculture, is very important. And that's one target.
    I would say that it's interesting you brought this up here, 
and very appropriate, because it is another area very similar 
to what we've heard about rare diseases or device development 
for small populations, where the economic incentives for 
development do not always drive the public health outcome we 
seek. So, I think it's very reasonable for you to consider that 
issue, you know, How do we incentivize development of new 
drugs?
    The other thing about appropriate use is, as we think about 
healthcare reform and having a very good learning and effective 
health system, really, How do we develop science about 
something very practical? It's not typically done in university 
laboratories, which is--What is the best way we use our 
therapies, to keep them useful and avoid problems? So, I think 
this is a very important and fertile area, and not unrelated, 
because of the incentive issue, to the issue of rare and 
neglected diseases. In fact, resistant bacteria start out rare. 
And for a developer who wants to make a product for that 
specific bacteria, the audience or market at that time may be 
very small, and the incentives may be unclear, and then, 
particularly if we in the medical system want to say, ``Use 
that very appropriately, and just for those resistant 
organisms.''
    Senator Casey. Thank you.
    [The prepared statement of Senator Casey follows:]

                  Prepared Statement of Senator Casey

    I would like to start off by thanking my colleague and 
friend Senator Brown for calling this hearing today to draw 
attention to rare and neglected diseases in children. I would 
also like to recognize the leadership of this committee for the 
past work that has been done on this important issue--and the 
progress that has followed as a result of bipartisan efforts.
    Today, we gather to discuss the challenges facing 
individuals with rare diseases, their families, friends and 
caregivers. While each of the 6,000 or 7,000 rare diseases that 
we know of affects only a small number of people, collectively 
these diseases affect 25 to 30 million Americans--almost 10 
percent of our population. Many of those affected are children.
    The diagnosis of a rare disease can be frightening even to 
an adult; for a child, it is particularly devastating. I am 
glad that progress has been made over the last two decades to 
improve children's access to treatments for rare diseases. But 
much remains to be done. Among children with the most common 
rare diseases, one in four will not live to see their first 
birthday. This startling and disturbing fact should evoke not 
just concern, but action.
    When I consider the challenges of confronting rare diseases 
and legislative actions that will protect our children, I am 
reminded of my father's work as a public official over many 
years in Pennsylvania. As a State senator in the 1960s, he 
learned that a simple test for PKU, a birth defect that 
prevents an individual from metabolizing certain foods, was not 
required in Pennsylvania. Children with undiagnosed PKU often 
end up with severe intellectual disabilities. So he introduced 
a bill requiring that all children born in Pennsylvania be 
tested at birth for PKU; the bill passed, and many children's 
lives were immeasurably improved by one simple law. Thirty 
years later, after serving as Governor, he remembered the bill 
as one of the best things he ever did as a public official.
    I, too, believe that helping every American child reach 
their full potential is one of the most important things that 
we, as public officials, can hope to do. This committee has 
shown great leadership on this issue in the past, and I am 
committed to seeing it continue to ensure progress continues 
for children with rare and neglected diseases. Too often, there 
is no effective therapy for a rare or neglected disease, let 
alone a cure. The treatments that are available are often 
experimental, ``off-label,'' meaning that in addition to 
battling the disease afflicting their child, parents must 
battle with insurance companies to pay for treatment.
    I have heard from many of my constituents about the 
challenges they face with rare diseases, including some of the 
diseases that I believe our witnesses will discuss today. In 
2007, I met with a group of mothers who shared their struggles 
and frustrations in getting ongoing and consistent treatment 
for their children, each of whom suffers from a rare disease. 
Many of these parents had been able to enroll their children in 
clinical trials at the National Institutes of Health (NIH) and 
had found experimental treatments for their children that had 
proven extremely successful. The doctors at NIH do miraculous 
work in finding treatments for children with rare genetic 
diseases. However, when the trial ends, these children and 
parents are often left on their own, with no access to the 
previously free and effective treatment that their children 
were receiving.
    If the treatment is a drug that has not been approved by 
the Food and Drug Administration or has not been specifically 
approved for a child's particular disease, then insurance 
companies typically will not cover it because the treatment is 
considered ``off-label'' or ``experimental.'' If a family has 
enough insurance and there is off-label FDA approval, sometimes 
families can get coverage of the drugs. If not, the resulting 
cost to families is astronomical--ranging anywhere from $10,000 
to $30,000 per month.
    This is what happened to Nino Todaro, a young boy from 
Carlisle, PA, and that is why Senator Specter and I introduced 
Nino's Act, S. 406, which will allow children to transition out 
of successful treatment in NIH studies without a gap in 
treatment. There are thousands of children like Nino across 
this country who desperately need the continuity of ongoing 
successful treatment for their rare disorders. These are 
children who have been very ill, sometimes incapacitated, and 
have been able to resume normal childhoods through successful 
drug treatment.
    With all our medical technology and advancements, no child 
in this country should ever be denied medical treatment that is 
available and proven effective. Nino's Act will give these 
children and their parents the peace of mind in knowing that 
when a study ends, their children's successful ongoing 
treatment will not end. To address this, Nino's Act will 
require Medicaid to cover the cost of treatment in the event 
that a child's health insurance does not.
    I hope that today's hearing will help us chart a path 
forward. I would like to thank our witnesses for their 
testimony today, and for sharing with us their insights as 
researchers, parents and advocates for children with rare 
diseases.

    Dr. Goodman. Sure.
    Senator Brown. Thank you, Dr. Goodman.
    Senator Casey, if you have further questions, you can 
submit them for the record, of course, for them.
    Thank you very much, Dr. Guttmacher and Dr. Goodman. You're 
dismissed and I'd like to call the second panel.
    [Pause.]
    Thank you all for joining us.
    I will begin the introductions, from left to right. And I 
know that Senator Sanders wants to introduce Ms. Moon, which he 
will certainly be given an opportunity to.
    Alex Silver will start off our second panel. I'd like to 
begin by welcoming him and his family, including his wife, 
Jamie, his mother, Margaret, his father, David, and his father-
in-law, Edward, and the good family and grandparents they are. 
So, thank you for joining us. He's a partner at P2 Capital, a 
private investment firm in New York, holds an MBA from Harvard 
Business School, a BA in Political Science from Brown 
University. Mr. Silver is a trustee of the Dystrophic EB 
Research Association of America, an organization dedicated to 
finding a cure for EB. He recently founded the Jackson Gabriel 
Silver Foundation, a nonprofit dedicated to both increasing 
research and finding a cure. The foundation is named after the 
Silvers' 2\1/2\-year-old son, Jackson.
    Our next witness, Diane Dorman, is vice president for 
public policy for the National Organization for Rare Disorders. 
She is the primary Washington representative for more than 20 
million Americans who have one of the 7,000 known rare 
diseases. Since joining NORD in October 2000, Ms. Dorman's 
advocacy has been instrumental in the passage of two new public 
laws. She's been influential in the adoption of numerous 
programs and regulations that touch the lives of patients with 
rare disorders.
    John Crowley is president and CEO of Amicus Therapeutics. 
Mr. Crowley has worked with several top pharmaceutical 
companies, and was instrumental in finding a treatment for 
Pompe disease, which is a fatal neuromuscular disorder. His 
involvement with this disease is personal, rooted in the 1998 
diagnosis of two of his children, Megan and Patrick. His 
dedication toward finding a treatment was highlighted in 
several television shows, was featured in a book entitled ``The 
Cure: How a Father Raised $100 Million and Bucked the Medical 
Establishment in a Quest to Save His Children.'' His efforts to 
develop a treatment for his children were also chronicled in 
the movie ``Extraordinary Measures.''
    Thank you, Mr. Crowley, for joining us, too.
    Senator Sanders.

                      Statement of Senator Sanders

    Senator Sanders. Thank you very much, Mr. Chairman. I am 
pleased to welcome our next witness. Ms. Suerie Moon is a 
member of the board of directors of Doctors Without Borders 
U.S.A., known internationally--forgive my French here--Medecins 
Sans Frontieres, or MSF. In 1999, MSF received the Nobel Peace 
Prize, ``in recognition of the organization's pioneering 
humanitarian work on several continents.'' MSF is an 
international independent medical and humanitarian 
organization. And I want to applaud MSF for all the wonderful 
work they do.
    In this country, MSF is most widely known for emergency 
response during armed conflict or following cataclysmic natural 
disasters. What is not so widely known is that it has been 
engaged for decades in providing care and treatment to 
impoverished people suffering from diseases so neglected that 
most people in developed countries have not even heard of them.
    Ms. Moon's own experience spans three continents over more 
than a decade, including field work in the Democratic Republic 
of Congo and China, and research and analysis on access to 
medicines and innovation policy issues.
    It is my pleasure to introduce her today.
    Senator Brown. Thank you, Senator Sanders.
    Our last witness will be Dr. Daniel Frattarelli, who's the 
chair of Committee on Drugs at the American Academy of 
Pediatrics. He's a practicing pediatrician and an expert in 
clinical pediatric pharmacology. Dr. Frattarelli is chair 
pediatrics at Oakwood Hospital Medical Center in Dearborn, MI, 
not far from my State.
    Welcome, to all of you.
    Mr. Silver try to keep your testimony close to 5 minutes. 
And if that means--we have all your testimony in the record, if 
you want to summarize, however you want to do it.
    Proceed, Mr. Silver.

  STATEMENT OF ALEXANDER J. SILVER, FOUNDER, JACKSON GABRIEL 
                SILVER FOUNDATION, NEW YORK, NY

    Mr. Silver. Thank you. I would like to thank Ranking Member 
Enzi, Senator Brown, a real champion in this area, Senators 
Casey and Sanders, and the rest of the committee for inviting 
me to speak today on behalf off of the children who have 
epidermolysis bullosa, also known as EB.
    I would like to thank the committee members who supported 
Senate Resolution 180, establishing national EB awareness week. 
With your continued support, EB can be cured. I would like to 
recognize Megan Barron, Joella Murray, Kati Ward, Michelle 
Hall, and Wyeth Carpovich, all who are here today, and all who 
suffer from EB. Thank you for being with us. Your burden, one 
that no one should face, inspires us to do what we must: cure 
this disease.
    EB is a devastating disorder that affects a child from the 
moment of birth. A child suffering from EB lacks the critical 
protein which acts as a Velcro between the layers of skin. 
Without this, skin slides apart, blisters, and sheers off, 
causing severe pain, disfigurement, including fused toes and 
fingers, shredded corneas, closed throats, and, in too many 
cases, premature death.
    To give you a sense of what EB life is like, I'd like to 
tell you about my 2\1/2\-year-old son, Jackson, who was born 
with a severe form of EB. We learned of his EB when nurses 
removed a Bandaid from his newborn heel and it ripped off all 
his skin. Every morning, my wife Jamie and I wake up and hope 
that Jackson hasn't torn the skin off his neck and face. We 
hope his mouth and throat have not blistered, preventing him 
from eating. We check his body for blisters, and we lance any, 
with large needles. Jackson takes stinging baths with bleach, 
every day, to kill the bacteria in his open wounds. He sits 
patiently through bandage changes. A fall on the playground can 
tear the skin off his palms. Every day, we witness his body 
being ravaged by this disease, and it does not have to be this 
way.
    The Government considers EB to be a catastrophic disease. 
Catastrophic only begins to describe what life with EB is like. 
Respectfully, Senators, please take a moment and imagine your 
son or daughter as one of these innocent and helpless children, 
painfully having their bodies transformed into one devastated 
by infected wounds, blisters, and scarring. Imagine the simple 
act of hugging your child could tear the skin off. This 
describes a fraction of what these children experience. 
Everything we do in life impacts our skin.
    Perhaps the most hopeful aspect of EB today is the quality 
of research being performed. EB research is at a stage where 
treatments and cures have the potential, with your help, to 
become a reality. We are not at the beginning of this journey. 
With more funding, a finish line can be in sight.
    The solution must be a combined effort between public and 
private sectors. To give EB children a chance, they need more 
research funding and incentives for private research, a 
streamlined approval process, and affordable treatments.
    Fewer than 3 percent of rare diseases have treatments 
available. Only 0.3 percent of the NIH's 2009 budget was spent 
directly on rare diseases. I estimate that only $16 per 
affected person per year is spent on searching for cures--$16.
    The 2010 Federal budget calls for $3.4 billion for carbon 
capture technology. Investing in the future of American energy 
is important. Shouldn't investing in the future of the leaders 
of America be at least as important? The authorized, but 
unfunded, Cures Acceleration Process is a good start, but we 
need to do more.
    When curing a disease is the mathematics of how many 
children are afflicted verse the profit potential of a 
treatment, we have gone far astray of our fundamental American 
values. Private funding will not cure a disease affecting too 
few people. We need you, our government, to provide incentives 
to spark private development of therapies. The proposed 
Priority Voucher Program is a fantastic example. It encourages 
companies to focus on rare drug disease development, providing 
commercial benefits without costing the taxpayers anything.
    Achieving the balance of safety of treatments and the 
devastation of rare diseases is a tremendous challenge. Because 
of the horrific symptoms of EB, individuals and their parents 
are more willing to accept risks that may be inherent in 
emerging therapies. I am not advocating that safety be cast 
aside. I am saying that a person with EB defines safety 
differently than a healthy person, because simply living is 
unsafe. As CureTheProcess suggests, the FDA should consider 
issuing new guidelines to give rare diseases an accelerated and 
streamlined approval process.
    Treatments of rare diseases often lead to discoveries with 
wider applications. By devoting the resources to protein, stem 
cell, and gene therapies to combat EB, we could be aiding many 
other Americans. This potentially includes brave veterans who 
suffer burns on the battlefield, and those suffering from 
chronic wounds and ulcers that will not heal.
    In closing, while there is promising research focused on 
helping children with EB, the current system fails them. The 
solutions are clear: more public and private funding, an 
accelerated review process, and affordable treatment. With this 
committee's help Jackson, Joella, Megan, Michelle, Kati, and 
Wyeth, and other kids with EB, can grow up to live healthy and 
pain-free lives, but only if we give them that chance. Inaction 
is not a choice. We can cure this disease. Let's turn that hope 
into a reality, and let's do it now.
    Thank you for the opportunity to testify today.
    [The prepared statement of Mr. Silver follows:]

               Prepared Statement of Alexander J. Silver

                                SUMMARY

    My testimony presents a parent's perspective of the painful day-to-
day experience of living with Epidermolysis Bullosa (EB) and conveys 
the devastation that this disease has ravaged on my son and other 
children who suffer from it. I aim to raise awareness about EB as well 
as to provide solutions that are within our grasp to treat and cure EB 
and other rare diseases. My testimony describes the current state of EB 
research and recommends the following measures be taken as soon as 
possible: (i) increase funding for EB and rare disease research; (ii) 
create and refine private market incentives to spur development of 
treatments and cures; (iii) re-
design and streamline the approval process for rare diseases; and (iv) 
ensure treatments are attainable to those who need them.

                     WHAT IS EPIDERMOLYSIS BULLOSA?

     EB is a disorder that impairs a child's layers of skin 
from staying together. This child is missing a protein that acts as the 
``velcro'' between the layers of skin causing his or her skin to 
blister and shear off with movement. There are three major EB 
subtypes--Simplex, Junctional and Dystrophic. Only 2 to 4 out of every 
100,000 children are born with EB. My son Jackson was born with 
Recessive Dystrophic EB (RDEB), one of the most severe subtypes, in 
October 2007.

                         THE DEVASTATION OF EB

     EB profoundly impacts every aspect of life. Skin is the 
body's largest organ. Children with EB may be unable to walk, eat, 
play, sit, write, hug or even sleep without significant risk of skin 
shearing off their little bodies. Fingers and toes can become fused 
together forming mittens and unusable feet. The esophagus can close due 
to injury from eating. Malnutrition, infection, ocular and dental 
issues, constant pain and cancer at an early age characterize the lives 
of these children.

      CURRENT EB RESEARCH AND THE REASONS EB PATIENTS CONTINUE TO 
                           SUFFER NEEDLESSLY

     There is high quality research being performed today that 
can render this disease livable and curable. Researchers know exactly 
what causes this disease and have encouraging knowledge of how to fix 
it. We are failing to marshal the resources needed to get there. EB is 
at a stage where treatments and cures have the potential, with more 
funding, to become a reality.
     Major areas of research being conducted include protein 
replacement as well as stem cell and gene correction therapies. Many of 
these researchers are hoping to commence Phase I trials as soon as 
possible.
     Children with EB needlessly continue to suffer because the 
target market of EB children is not large enough to attract commercial 
interest on its own. When curing a disease devolves into the 
mathematics of how many children are afflicted versus the profit 
potential of developing attainable treatments, we have gone astray from 
our fundamental American values.

   WHAT IS NEEDED TO BEAT EB, OTHER RARE DISEASES AND SAVE AMERICA'S 
                                CHILDREN

     More Funding--Of the 7,000 rare diseases affecting 30 
million Americans (10 percent of the population), less than 0.3 percent 
of the 2009 NIH budget was spent on finding cures for these diseases 
and likely less than $16 annually of Federal funds is spent per person 
suffering from a rare disease to find a cure. This is not a question of 
additional spending but one of our priorities.
     Public/Private Partnerships and Commercial Incentives--For 
a disease that affects too few people to spark commercial interest, the 
government must provide incentives for private development of drugs and 
therapies. The proposed priority voucher program encouraging drug 
development for rare pediatric diseases enables a company to focus on 
orphan drug development because it can enjoy commercial benefit and 
also serve a social good. This would bring additional solutions to the 
market quickly, which would help children with EB and other rare 
diseases without costing the taxpayers anything.
     Streamlined Approval Process--Achieving a balance between 
the safety of treatments and the devastation of rare diseases remains a 
tremendous challenge for regulators. Because of the horrific symptoms 
of EB, individuals with EB and their parents are more willing to accept 
risks that may be inherent in emerging therapies. The CureTheProcess 
campaign suggests that the FDA create a new review division for rare 
biochemical diseases; and for the FDA to issue new guidelines to give 
the rarest diseases access to an accelerated approval process. By 
working together, CureTheProcess, the NIH TRND Program, Cures 
Acceleration Network and others can ensure patients with rare disorders 
get earlier access to effective treatments.
     Affordability of Treatments--Potential treatments for EB 
and other rare diseases must be made affordable to those who need them 
most. A cure for EB is useless to the child shut out because he or his 
family cannot afford to pay for it.
     Wider Application of Treatments Developed for EB--
Treatments for rare diseases often lead to discoveries with much wider 
applications. A few examples are Remicade, Rituxan and Epogen. By 
devoting resources to protein, stem cell and gene therapies to combat 
EB, we may also aide many other Americans. This potentially includes 
brave veterans who suffered burns that resulted in blistering and 
scarring while serving our country, as well as victims of other burn 
injuries and those who suffer from wounds and ulcers that will not 
heal. These individuals share many characteristics with severe RDEB 
children. EB is worthy of curing in its own right, but many Americans 
could benefit as well.
                                 ______
                                 
    I would like to thank Chairman Harkin, Ranking Member Enzi, Senator 
Brown and the entire committee for allowing me to speak today on behalf 
of the children, and their families, who suffer from Epidermolysis 
Bullosa, also known as EB. I would also like to thank the members of 
the committee who supported Senate Resolution 180 in 2006, which 
established National EB Awareness Week. Specifically, I would like to 
thank Senator Hatch, who was a co-sponsor of this resolution. S. Res. 
180 passed the Senate by unanimous consent and without amendment. With 
your continued support, we can transform EB into a treatable and 
curable disease. I would also like to recognize Megan Barron, Joella 
Murray and Leandro Santos who are in attendance today. These 
individuals all suffer from EB. They endure more pain than one can 
imagine. Their burden, one that no child or person should face, 
inspires us to do what we must--cure this disease.

                  WHAT IS EPIDERMOLYSIS BULLOSA (EB)?

    EB is a debilitating and devastating genetic disorder that affects 
a child from the moment he or she is born. EB is not specific to any 
ethnicity or gender. A child who suffers from EB lacks the critical 
protein that binds his or her layers of skin together. This protein 
acts as the ``velcro'' that attaches one layer of his or her skin to 
the other. Without this ``velcro'' when this child moves, his or her 
skin slides apart, blisters and shears off leading to severe pain, 
disfigurement, and in too many cases, a premature death from an 
aggressive form of skin cancer called Squamous Cell Carcinoma. Within 
certain subsets of EB, the cumulative chance of developing this cancer 
is almost 100 percent. A child with a severe form of EB can have a 60 
percent cumulative risk of dying by age 15. There are three major EB 
subtypes--Simplex, Junctional and Dystrophic and within each type there 
are multiple subsets. The difference among them is the level at which a 
blister forms within the skin and which particular protein is missing 
or impaired.
    My experience with EB began on October 11, 2007. On that day, my 
wife Jamie and I were blessed with the birth of our beautiful son 
Jackson, who is the light of our lives and a joy to everyone around 
him. Yet, our lives were nearly shattered with the diagnosis that 
Jackson was born with a form of EB called Recessive Dystrophic EB (or 
RDEB for short). Despite being born at a major metropolitan hospital, 
the physicians caring for Jackson had never seen a case of RDEB before, 
which made his condition difficult to diagnose, an experience most EB 
children share. RDEB is considered to be one of the worst forms of EB. 
Jackson, like all those with RDEB, is missing the protein Collagen VII. 
This became evident on the day after Jackson's birth, when nurses 
removed a bandaid from his newborn left heel and the adhesive tore off 
his precious skin. Most of my comments will focus on RDEB, although 
there are equally horrific forms of EB which share many characteristics 
with RDEB.
    Like most people, I had never heard of EB and had no awareness that 
our son would suffer from this condition until he came into this world. 
We did not know about EB because it is an orphan disease, which is 
defined as a disease affecting fewer than 200,000 people. Figures from 
the National Institutes of Health estimate that between 2 and 4 out of 
every 100,000 children are born with EB. Based upon these figures, EB 
would be an ``ultra-orphan'' disease defined as a disease that affects 
fewer than 20,000 people in the United States. The Government considers 
EB a ``catastrophic illness.'' ``Catastrophic'' only begins to describe 
life with EB.

                         THE DEVASTATION OF EB

    To say that EB impacts every aspect of a child's life is a gross 
understatement. Skin is the body's largest organ. Among its most 
important functions, skin is the first line of defense to protect the 
body from trauma and infection. Everything we do in life impacts our 
skin--walking, eating, playing, sitting, writing, hugging, sleeping--
the list goes on. For children with EB--like our son Jackson--every 
aspect of their lives at every moment is overshadowed by this terrible 
disorder. These children are often born missing large areas of skin 
leaving gaping wounds that never heal; walking and standing are 
impaired over time because their toes become fused as the result of 
continuous injury; the simple joy of holding a crayon to draw becomes 
impossible because their fingers fuse and contract turning their young 
hands into mittens; eating is painful and sometimes impossible because 
the esophagus closes due to injury and scarring, which is only 
temporarily reprieved by a surgical procedure in which the esophagus is 
stretched open. When this solution stops working, a gastric feeding 
tube is placed in their small bellies in order to enable proper 
nutrition and hopefully stave off growth retardation and anemia. Even 
the fundamental act of sleeping is extraordinarily difficult because of 
the level of pain and discomfort that these children experience 24 
hours a day.
    Like all kids, children with EB rub their eyes when they are 
sleepy. Only in their case, rubbing their eyes can tear their eyelids 
and corneas, prohibiting these children from opening their eyes in the 
morning without suffering extreme pain. Naturally, children with EB 
also want to play alongside their peers. However, falling down on the 
playground can remove all the skin from their little palms or produce 
blisters on their knees the size of oranges. Respectfully Senators, 
please take a moment and imagine yourself, your son or your daughter, 
or a relative being one of these innocent and helpless children--slowly 
and painfully having your little body transformed into one devastated 
by infected open wounds, blisters and scarring. Imagine that the simple 
act of hugging your child could tear the skin off his or her body. This 
describes just a fraction of what these children experience, as it does 
not account for the social scrutiny and the stares they receive by 
simply walking or being wheeled down the street. In its entirety, EB 
impacts vision, speech, nutrition, mobility and indeed every single 
aspect of a child's life. Unfortunately, a recent study determined that 
approximately 50 percent of children with RDEB are always in pain.
    During a typical day, a child with RDEB undergoes a special bath 
and a bandage change. Given the large areas of skin missing from such a 
child's body, bathing is an extraordinarily painful experience. Bandage 
changes can last anywhere from 30 minutes to several hours and bandages 
can cost a family as much as an astounding $14,000 per month. An EB 
child's meals consist mostly of soft foods and liquids, assuming he or 
she has not been forced to resort to receiving nutrition through a 
feeding tube. When skin blisters or tears, it must be treated as soon 
as possible, causing parents to carry a costly arsenal of needles and 
bandages anytime that they leave the house. For a child with EB, the 
joyful act of participating in sports--such as little league or youth 
soccer--is often out of the question due to the skin tears, blisters 
and scarring that would result. For this reason, even playing with 
other children can be impossible. Simply put, this disease prevents a 
child from just being a child.
    Speaking for a moment as Jackson's dad, every morning Jamie and I 
wake up and hope that Jackson hasn't torn the skin off his neck and 
face from rubbing during his sleep. We hope he does not have a blister 
in his mouth or his throat that prevents him from eating that day. 
Throughout the day, we check his body for blisters that have developed 
and lance any with large needles when we see them. Sometimes this can 
be extremely painful to Jackson but we are forced to physically 
restrain our son and do it anyway. We dress him in special shoes and 
only soft clothing. We keep bacterial culture kits at home and use them 
all too often to check him for infection. Like many EB patients, our 
son must avoid crowded places that kids love such as zoos, museums and 
birthday parties. And we must stay indoors during the bulk of the 
summer because the heat and humidity exacerbates his blistering. Every 
day, Jackson takes a bath with vinegar or bleach to help kill the 
bacteria on his little body. This bath often causes stinging pain to 
Jackson's many open wounds. He sits patiently through his uncomfortable 
bandage changes; sadly, our little boy does not know any differently. 
He endures physical, occupational and feeding therapies as well as 
specialized nursing visits six times per week to keep his body as 
mobile and healthy as possible. And yet, through all these painful 
challenges that would cause most of us simply to give up, our brave 
Jackson's smile lights up a room even though his body is slowly being 
ravaged by this disease. Some additional examples: as noted above, our 
son lost all of the skin on his heel from the removal of a bandaid the 
day after his birth which has never grown back normally; his hands are 
severely scarred and the quality of his skin is poor due to the 
continuous damage they endure; that damage continues to progress up his 
arms everyday. It's critical to note that--despite the pain and 
discomfort I have just described--Jackson has a moderate case of RDEB. 
Children with more severe cases suffer exponentially more.
    With this background, the key questions are: (i) where are we now; 
(ii) where can we can go; and (iii) what is needed to succeed at giving 
these children the fundamental American right of a chance at living 
good lives.

      CURRENT EB RESEARCH AND THE REASONS EB PATIENTS CONTINUE TO 
                           SUFFER NEEDLESSLY

    Perhaps the most hopeful aspect of EB today for Jackson, and all 
children living with EB, is the quality of research being performed in 
the United States and internationally that can render this disease 
livable and ultimately a disease of the past. Due to research dating as 
far back as 1974, which has been funded by NIH grants as well as 
private donations; EB is at a stage where treatments and cures have the 
potential, with your help, to become a reality. Indeed, researchers 
know exactly what causes this disease and have encouraging knowledge of 
how to fix it. But where we are failing is in marshalling the resources 
needed to get there. To reiterate, we are not at the beginning of this 
journey. Technology has caught up to the research and, with more 
funding, a finish line can be in sight for the thousands of children, 
like our son Jackson, who were born with this disease.
    Some of the major areas of research currently being conducted in 
the United States include protein therapy by Doctors David Woodley and 
Mei Chen of the University of Southern California and Doctor Peter 
Marinkovich of Stanford University. The concept of this research is 
straightforward. EB researchers estimate that a person needs only 35 
percent of the typical level of Collagen VII for the skin to behave 
normally. Drs. Woodley and Chens' concept is to replace the protein 
that is missing in RDEB kids--Collagen VII--with localized injections. 
Drs. Woodley and Chen have proven in a mouse model that this method 
works. They are now looking to commence a Phase I trial as soon as 
possible. Experts indicate that with the sufficient resources, a 
commercialized therapy could be available in 5 to 8 years. Imagine what 
that would mean to a child whose skin tears off in her shoes to have a 
localized injection that renders the skin on her feet potentially 
normal. For years, doctors have administered localized injections of 
Collagen I for cosmetic purposes. Collagen VII and Collagen I are 
related. In this proposed treatment, the doctors would simply 
administer Collagen VII in a similar fashion as Collagen I is 
administered in a cosmetic setting. In other words, doctors have the 
knowledge to apply this treatment as soon as it is available. While not 
a cure, this would be a truly viable ``game changing'' treatment, 
allowing a child like my son to live a better life.
    Other potential cures are being pioneered both at the University of 
Minnesota and at Columbia University by Drs. Wagner, Tolar, Christiano 
and Cairo. These are stem cell therapies and the basic concept is to 
replace the bone marrow of an individual with EB with a donor who has 
the proper Collagen VII production capability. As the body's wounds 
heal and the skin regenerates, the theory is that Collagen VII would be 
produced, which in turn would keep an EB patient's layers of skin 
together. There are currently trials ongoing at both locations, which 
have shown promise as a systemic cure.
    At Stanford University, Drs. Lane and Khavari have labored over a 
form of gene therapy to treat EB. In this approach, a small section of 
skin is removed from a person with EB and the gene ``error'' is 
corrected to produce Collagen VII. The corrected skin is grown into 
larger amounts and then grafted back onto the body. We hope that they 
can commence a trial very soon.
    In addition to these efforts, internationally, there has been work 
by Dr. John McGrath in the United Kingdom in which individuals with EB 
received injections of donor cells that produce Collagen VII. Results, 
though early, have been promising.
    So why hasn't Collagen VII been developed commercially? Given that 
its unquestionably important life saving purpose? The answer is that 
the target market of EB children is not large enough to attract 
commercial interest on its own. Development costs--which can run into 
the hundreds of millions of dollars--trump the profit that can be made. 
Simply said, the economics do not work in most cases--and children like 
our son Jackson are the victims of this unfortunate and unfair fiscal 
reality. When curing a disease devolves purely into the mathematics of 
how many children are afflicted with EB versus the profit potential of 
developing this attainable treatment for these children, we have gone 
astray from our fundamental American values. As I described earlier, 
there are real therapies and treatments in the works that--with 
appropriate funding--can offer these children suffering from EB a 
chance at a ``normal'' life. What keeps these children in bandages is 
the lack of funds, the difficulty in attaining any funds that may exist 
and the cumbersome approval process of potential treatments.

         WHAT IS NEEDED TO BEAT EB AND SAVE AMERICA'S CHILDREN

    I believe the solution must be one of a combined effort between the 
public and private sectors. For EB children to have a chance at a life 
free of pain--one where they can ``truly'' be kids--they need more 
available funding for researchers, more incentives to fund this 
research via a public/private partnership, an approval process that 
considers both safety as well as the devastating effects of EB, and 
finally a mechanism to ensure the treatments are affordable to those 
who need them.
    The National Organization for Rare Disorders (NORD) estimates that 
there are 7,000 rare diseases affecting 30 million Americans. Of these 
disorders, only approximately 200 have FDA-approved treatments. Less 
than 3 percent of these diseases have treatments available. According 
to figures provided by the NIH, it provided only $118 million in 
research funds for orphan drugs out of its $30 billion budget in 2009. 
Unfortunately, this amounts to 0.3 percent of the NIH budget. The 
Office of Orphan Drug Development provides approximately $15 million 
annually in grants. Assuming there is additional funding via other 
Federal sources, it may be safe to assume that approximately $500 
million in Federal funding per annum is available for orphan diseases. 
To put this in context, Genzyme, a biotechnology company, estimates 
that it cost over $500 million to develop a treatment for a rare 
disorder called Pompe disease. It also means that of the 10 percent of 
the U.S. population affected by rare diseases, roughly $16 per person 
is spent per year in searching for cures. ONLY $16. The U.S. Federal 
budget is $3.5 trillion. Of that amount, the 2010 budget calls for $3.4 
billion to support carbon capture and storage technology. Investing in 
the future of American energy is very important. But it begs the 
question; shouldn't investing in the future leaders of America--
including our son and the many other bright young stars afflicted with 
this horrible disease--be at least as important? Given the current 
economic environment, I understand as well as anyone that there is 
little room for additional spending and we have many pressing issues at 
hand. It is a question of what our priorities should be as Americans 
who value human life and the right to have a ``normal'' and carefree 
childhood.
    The Government cannot provide the solution itself, nor should it be 
expected to. However, for a disease that--although devastating and 
debilitating--affects too few people to spark commercial interest, the 
Government must lead and provide incentives for private development of 
drugs and therapies. The proposed priority voucher program encouraging 
drug development for rare pediatric diseases, which is a refinement of 
the tropical disease voucher program, is a fantastic example. If this 
program is expanded to cover rare pediatric diseases, then a company 
that would not otherwise focus on orphan drug development will do so 
because it can enjoy commercial benefit while also serving a social 
good. This would bring additional solutions to the market quickly, 
which would help every child with EB and indeed any other rare disease. 
Corporations will follow the Government's lead. Public interest, 
awareness and incentives can shape private behavior. Creative solutions 
that provide direct or indirect incentives are effective and 
indispensable methods to spur the pace and likelihood of treatment 
developments. I--along with all other parents of sons and daughters 
suffering from rare diseases--urge you to consider the proposed 
priority voucher program. This program can improve and save the lives 
of millions without costing the taxpayers anything.
    Beyond additional funding and private market incentives, the 
process for the approval of rare disease therapies must be streamlined. 
Achieving the delicate balance between the safety of treatments 
(particularly new or developing treatments) and the devastation of rare 
diseases remains a tremendous challenge for regulators. We need a 
process which deeply considers the alternative that individuals with EB 
or other orphan diseases face in lieu of approved treatments. A child 
with RDEB lives each day with tremendous pain, hoping his fingers and 
toes do not fuse and his esophagus does not close. With this disease, 
every breakdown is one step closer to a terminal cancer. Because of the 
horrific symptoms of this disease, individuals with EB and the parents 
of children with EB are more willing to accept risks that may be 
inherent in emerging therapies because the alternative is a painful and 
debilitating life. I am not advocating that safety be cast aside. I am 
saying that a person with EB defines safety differently than a healthy 
person; to a person with EB, simply living life is inherently unsafe. 
The CureTheProcess campaign by the Kakkis Foundation has promising 
ideas on how to address this issue. CureTheProcess suggests that the 
FDA create a new review division for rare biochemical diseases; and for 
the FDA to issue new guidelines to give the rarest diseases access to 
the accelerated approval process. We can quickly and dramatically 
improve the current regulatory process for rare diseases. The result 
should be a surge in development activity for even the rarest 
disorders. An improved regulatory path working together with the NIH 
TRND Program, Cures Acceleration Network and other new incentive 
programs will help ensure more patients with rare disorders will get 
earlier access to specific, effective treatments.
    These potential treatments for which we seek funding must also be 
made affordable to those who need them most. A cure for EB is useless 
to the child shut out because he or his family cannot afford to pay for 
it.
    One additional area that is often overlooked is that treatments for 
rare diseases often lead to discoveries with much wider applications. 
For example, Remicade--which was developed for the treatment of Crohn's 
disease, a population of 500,000 people--has been found to effectively 
treat Rheumatoid Arthritis and forms of Psoriasis, a population of over 
5 million people. Rituxan, developed for non-Hodgkin's lymphoma--a 
group of 70,000 people per year now helps the 1.3 million Americans who 
suffer from Rheumatoid Arthritis. Epogen, now used for Anemia, is 
another illustration.
    As these examples demonstrate, funding of orphan diseases can 
frequently have the unintended consequence of benefiting a much broader 
population than those suffering from the orphan disease itself. By 
devoting the resources to protein, stem cell and gene therapies to 
combat EB, we may also indirectly aide many other Americans. This 
potentially includes brave veterans who have suffered burns that 
resulted in blistering and scarring while serving our country on the 
battlefield, as well as victims of other burn injuries. These 
individuals share many characteristics with severe RDEB children. EB is 
worthy of curing in its own right, but many Americans (including many 
of America's Finest; the men and women of our military) could benefit 
along the way.

                               CONCLUSION

    In closing, while there is promising research focused on helping 
children with EB, the current system fails them. It does not provide 
enough funding, sufficient private market incentives or a review 
process that is appropriate for the severity of the disease. The 
solutions are clear--more public and private funding and partnerships, 
a streamlined and accelerated review process and affordable treatments. 
We know the solutions and now, with this committee's help and support, 
Jackson, Joella, Megan, Leandro and every child with EB can grow up to 
live healthy and pain-free lives. But only if we give them that chance. 
Inaction is not a choice. This can be done. We can cure this disease. 
Let's turn hope into reality, and let's do it now. Thank you for 
inviting me to testify today.
                                 ______
                                 
                                Appendix

                  I. FORMS OF EPIDERMOLYSIS BULLOSA\1\

    There are three main forms of EB: Eli Simplex. Junctional Eli and 
Dystrophic EB. These different subtypes are defined by the depth of 
blister location within the skin layers. Blister formation of EB 
simplex is within the epidermis. Sometimes EB simplex is called 
epidermolytic. Blister formation in Junctional EB is seen at the level 
of the lamina lucida within the basement membrane zone. Dystrophic EB 
or dermolytic EB is a scarring form of EB which occurs in the deeper 
tissue at the level the lamina densa or upper dermis.
---------------------------------------------------------------------------
    \1\ Dystrophic Epidermolysis Bullosa Research Association of 
America (DebRA).


    EB Simplex is caused by faulty proteins in the top layer of skin. 
This results in incorrectly formed keratins, deeming them unable to 
perform their normal role as a ``scaffolding'' for the top most layer 
of skin. The top layer of skin falls apart, resulting in a blister. 
Although EB Simplex is considered a non-scarring form of EB, secondary 
infection may cause scarring.
    Junctional EB is caused by mutations in the genes encoding alpha 6, 
beta 4 integrin, collagen XVII or one of the three chains of Laminin 5. 
This leads to defects in the formation of hemidesmosomes or anchoring 
filaments. Defects within any of those components of the skin allows 
for the separation of tissue and blister formation whenever there is 
friction or trauma to an area. In many instances blistering can occur 
spontaneously.
    Dystrophic EB is caused by mutations in the genes that carry the 
instructions necessary to produce the proteins in the basement membrane 
zone of the skin. This results in incorrectly formed anchoring fibrils, 
deeming them unable to perform their normal role as a ``stable 
interweave'' between the dermal and epidermal layers of the skin. 
Mutation occurs within the Collagen VII gene, which encodes the protein 
of the anchoring fibril. Anchoring fibrils hold together the two layers 
of skin. As a result, there is a lack of adherence and disruption of 
the skin when any friction or trauma occurs to an area. Where the two 
layers separate there is a blister. Blistering in the various types of 
dystrophic EB causes scarring.
    To differing degrees, EB can manifest itself in the following ways:

     Generalized blistering.
     Growth retardation and malnutrition.
     Gastrointestinal tract--may include blisters in mouth, 
esophagus and/or anal margins.
     Pseudosyndactyly--Fusion of fingers and/or toes.
     Problems with the soft tissue inside the mouth leading to 
esophageal strictures.
     Squamous Cell Carcinoma.
     Ocular (eye) involvement.
     Atrophic scarring--depressions in skin as a result of 
thinning in epidermis or dermis.
     Nail dystrophy--presence of rough, thickened or absent 
finger or toenails.
     Presence of Milia--tiny skin cysts.
     Anemia--a reduced amount of red blood cells, volume of red 
blood cells and amount of hemoglobin.
     Granulation tissue--appearance of red fleshy tissue which 
is capillary formation during tissue healing.
     Dental caries (cavities).
     Enamel hypoplasia--underdeveloped enamel upon the teeth.
     Genitourinary tract involvement including scarring and/or 
urethral stenosis.
     Scalp abnormalities--presence of blisters on scalp and/or 
scarring alopecia (areas of scarring with absence of hair growth).
     Respiratory tract involvement.

    Senator Brown. Thank you very much, Mr. Silver.
    Ms. Dorman.

 STATEMENT OF DIANE EDQUIST DORMAN, VICE PRESIDENT FOR PUBLIC 
 POLICY, NATIONAL ORGANIZATION FOR RARE DISORDERS, WASHINGTON, 
                               DC

    Ms. Dorman. Thank you, Senator Brown, Ranking Member, 
Senator Enzi, and other distinguished members of this 
committee, for inviting me to testify today regarding a topic 
that is extremely important to NORD.
    In the United States, as already been mentioned, there are 
nearly 7,000 diseases considered rare or affecting fewer than 
200,000 Americans. Some of these diseases affect only a few 
hundred people, or even a few dozen. There are certain 
challenges and issues that all people with rare diseases share, 
no matter where they fall in this spectrum.
    Since many rare diseases are genetic, more than two-thirds 
of these patients are children. Rare diseases tend to be 
serious and lifelong. Many are life-threatening.
    A recent editorial in the journal Nature noted that, among 
patients afflicted with any of the 350 most common rare 
diseases, 27 percent will not live to see their first birthday.
    My colleagues and I have a great deal of contact with 
patients and their families. Over and over again, we hear about 
the difficult issues they face, which include diagnosis delay, 
too little research, too few treatments, reimbursement issues, 
and a general sense of having been abandoned by our Nation's 
healthcare system.
    I've organized my comments and subtopics reflecting the 
most urgent issues, challenges, and opportunities that we face.
    No. 1 are preclinical challenges. Families often contact 
NORD just after having received a diagnosis. They are typically 
in a very fragile state, desperately seeking information, and 
hoping to find resources, medical experts, and clinical trials. 
All too often, we have to tell parents that there are no 
treatments for their child, and no one doing research.
    Part of the problem is a lack of natural history data, 
validated animal models, patient registries, and other tools 
that form the foundation for clinical research. The rare 
disease patient community is highly motivated and resourceful, 
but patients can't do it alone. There must be Federal funding 
and Federal guidelines to establish these basic tools for 
research. With such support, I can guarantee that patients and 
patient organizations will be active partners in moving studies 
forward.
    Then there are clinical challenges. Because patients are 
scattered around the globe, clinical research on rare diseases 
is more expensive and more challenging than other research. 
This must be taken into account in study requirements. 
Furthermore, patients with rare diseases are generally willing 
to accept higher levels of risk than other patients may be 
motivated to do.
    Also, rare-disease research today is often funded by the 
patient community, through golf tournaments, raffles, even bake 
sales and car washes. As a society, it is wrong for us to 
expect people with devastating diseases to fund the search for 
their treatments. A more significant commitment is needed at 
the Federal level.
    And there are regulatory challenges. NORD hosted a summit 
for 300 participants, in May 2009, to focus on accelerating the 
development of orphan products and ensuring patient access to 
them. A point made by several speakers was that industry 
frequently develops a second product for a disease rather than 
addressing a disease that has no treatment. This was 
attributed, in part, to a climate of regulatory uncertainty.
    A few weeks ago, the chairman of NORD's board of directors 
addressed a public hearing hosted by FDA. Noting that only 
about 200 of the nearly 7,000 rare diseases have treatments, he 
urged FDA to implement a statement of policy on rare diseases 
and orphan products. His point was that, while orphan drugs are 
reviewed with the same standards of safety and effectiveness as 
other drugs, FDA does exercise a certain degree of scientific 
judgment in reviewing products for rare diseases.
    There are reimbursement challenges, which is really 
devastating for families. Certain metabolic diseases, such as 
PKU, require specialized infant formulas and medical foods. 
Patients who don't get these special foods may suffer very 
serious consequences, including severe mental retardation. 
However, insurers, including Medicaid, don't always reimburse 
for these expenses, since these foods are not prescription 
drugs. Only about a third of the States currently mandate 
reimbursement for specialized infant formulas and medical 
foods. Since these foods are a necessary part of medical 
treatment for children with certain diseases, NORD would like 
to see a Federal mandate to ensure that no child is denied a 
needed medical food.
    Another reimbursement issue is the off-label use of drugs 
for rare diseases. It has been estimated that 90 percent of 
Americans with rare diseases are treated off-label, simply 
because there's no FDA-approved treatment for them. But, 
increasingly, insurers, both public and private, are denying 
coverage for off-label use of drugs, biologic and medical 
devices, on the basis that such therapies are experimental. For 
people with rare diseases who have no other option, this is a 
serious problem.
    Then there's the issue of humanitarian-use devices that 
Senator Franken has brought up. Pediatric medical devices are, 
similarly, very important. Children are not just small adults; 
they need both drugs and devices developed specifically for 
their unique needs. A member of NORD's medical advisory 
committee, Dr. Robert Campbell, who is a pediatric orthopaedic 
surgeon at CHOP, in Philadelphia, invented, developed, and 
brought to market a pediatric device, known as the ``expandable 
titanium rib,'' that has saved the lives of hundreds of 
children who have a rare condition known as thoracic 
insufficiency syndrome. Prior to his work, there was no 
treatment for children with this condition. Dr. Campbell's 
research was begun with a small seed-money grant from NORD and 
later funded by FDA's Orphan Product Grants Program. The device 
he developed was approved by the FDA as humanitarian-use 
device. Because no company was interested in manufacturing it, 
Dr. Campbell also took it upon himself to find a small company 
willing to do so. It took him 14 years to do so.
    This story is not unusual, and there are many children 
today desperately needing pediatric devices who don't have a 
Dr. Campbell looking after their interests. Those children need 
our help.
    In medical education, NORD worked closely with the medical 
community. And we believe that our Nation is blessed with many 
caring, dedicated medical people in the field. However, we feel 
that medical education in the United States does not adequately 
address rare diseases and related challenges at this time. We 
urge greater emphasis on rare diseases and on medical education 
centers to prepare young clinicians.
    Then there are current initiatives that we are working on. 
NORD believes significant progress has been made in recent 
months that will help to accelerate the development and 
treatment for children and adults with rare diseases. We urge 
continuation of initiatives, such as a training course for rare 
disease investigators, sponsored by FDA, NIH, NORD, and Duke 
University, that will result in development of a handbook to 
serve as a roadmap; a task force instituted by NORD, with NIH 
and FDA, collaborating to identify weaknesses in the system and 
ways for the two agencies to work closely together; and also, a 
congressional Rare and Neglected Diseases Caucus to focus on 
attention on these important issues.
    Our recommendations were as follows: continued progress in 
innovative initiatives, such as a training course; Federal 
funding and guidelines to develop natural history data; patient 
registration of their basic tools; recognition that clinical 
trials for rare diseases represent a unique set of 
circumstances and needs; reduced regulatory uncertainty; and 
increased emphasis on rare diseases in our centers of medical 
education. We endorse funding measures proposed for orphan 
product development in the current Senate appropriations bill. 
And we urge this committee to remember that research on rare 
diseases often provides fundamental breakthroughs in knowledge.
    In closing, I would like to reiterate several points. Among 
patients afflicted with any of the 300 most common rare 
diseases, 27 percent will not live to see their birthday. 
Patients and their families are willing to take on a far 
greater degree of risk than those affected by more common 
conditions. And finally, in an essay entitled ``The Keys to the 
Kingdom,'' by Dr. Fred Kaplan, the expert on one of the most 
rare and horrendous bone disorders, fibrodys-
plasia ossificans progressive, or FOP, Dr. Kaplan said,

          ``Research into the study of rare disorders will 
        provide the key that unlocks the door to the treatment 
        of the common disorders that affect the majority.''

    We all stand to improve our lives and our health by 
promoting the development of new treatments and cures for rare 
pediatric disorders.
    [The prepared statement of Ms. Dorman follows:]

               Prepared Statement of Diane Edquist Dorman

    I wish to thank Chairman Harkin, Senator Enzi and other 
distinguished members of this committee for inviting me to testify 
today regarding a topic that is extremely important to my 
organization--the development of safe, effective treatments and cures 
for the millions of American children afflicted with rare diseases.
    My name is Diane Dorman, and I am the vice president for Public 
Policy of the National Organization for Rare Disorders (NORD). NORD is 
a non-profit organization with offices in Washington, DC and Danbury, 
CT, that provides a voice to the nearly 30 million Americans with rare 
diseases. It was established in 1983 by patient organization leaders 
who served as the primary consumer advocates responsible for enactment 
of the Orphan Drug Act.
    In the United States, there are between 6,000 and 7,000 diseases 
considered rare, according to the National Institutes of Health. To be 
classified as ``rare'', a disease must be believed to affect fewer than 
200,000 Americans. This is the definition used by the Food and Drug 
Administration and by the National Institutes of Health.
    Although each individual rare disease affects no more than 200,000 
people, and some affect only a few hundred or even a few dozen, rare 
diseases in the aggregate affect approximately 1 in 10 Americans. There 
are certain issues and challenges that are common to all people with 
rare diseases, no matter where they fall on this spectrum.
    Since many of these diseases are genetic, many of the patients are 
children. It is believed that more than two-thirds of the individuals 
affected by rare diseases in the United States are children.
    Furthermore, most rare diseases are serious and chronic or 
lifelong. Many are life-threatening. A recent editorial in the journal, 
Nature, noted that among patients afflicted with any of the 350 most 
common rare diseases, 27 percent will not live to see their first 
birthday.
    My colleagues and I have a great deal of one-on-one contact with 
rare disease patients and their families, as well as with patient 
organization leaders. As you might imagine, some of the most difficult 
phone conversations we have are with parents of young children who have 
rare diseases. These families are faced with very difficult issues such 
as diagnosis delay, too little research, too few treatments, 
reimbursement or other financial issues, and a general sense of having 
been abandoned by our Nation's health care system.
    We very much appreciate the invitation to speak to you today. Since 
the topic is broad, I would like to organize my comments into the 
following sub-topics to reflect what we see as the primary issues and 
challenges through our daily contact with the families of children 
affected by rare diseases.

                        PRE-CLINICAL CHALLENGES

    Families often contact NORD just after having received a diagnosis 
for a child. They are typically still in a very fragile state in which 
they are desperately seeking information about the disease and hoping 
to find resources, medical experts, and opportunities to participate in 
clinical trials.
    You can imagine how difficult it is to have to tell families, as we 
frequently do, that not only is there no treatment for their child's 
disease but there is no research in progress. The sad reality for far 
too many people with rare diseases is that no one--at NIH, at a 
teaching hospital, on a university campus, or in industry--is doing 
research on their disease at this time. And no research means no hope 
for the future.
    Part of the problem is a lack of natural history data, validated 
animal models, patient registries and prevalence/incidence data on rare 
diseases. These basic tools form the foundation for clinical research, 
and they are a necessary first step.
    The rare disease patient community is highly motivated and 
resourceful. Many of the few patient registries and other research 
resources that exist at this time have been funded or launched by 
patient organizations. But patients can't do it alone. There must be 
Federal funding and Federal guidelines and encouragement for the 
establishment of these basic tools for research. With such support, I 
can guarantee that patients and patient organizations will be active 
partners in moving studies forward.

                          CLINICAL CHALLENGES

    Because of the small patient populations, and the fact that rare 
disease patients are scattered around the globe, clinical research 
aimed at developing treatments for the rare disease community is by its 
very nature more expensive and more challenging than other research. 
The requirements for clinical trials need to be stringent enough to 
provide reasonable assurance of safety and efficacy for patients, but 
they must also take into account the fact that these diseases present a 
unique set of challenges for researchers. In addition, patients with 
rare diseases are generally willing to accept higher levels of risk 
than other patients may be motivated to do.
    At this time, a significant portion of rare-disease research is 
funded by the patient community. While NIH and particularly the NIH 
Office of Rare Diseases Research have made admirable strides in recent 
years in focusing greater attention on the need for research on these 
diseases, for many of the very rare diseases it is still too often the 
patient community that funds and drives research through golf 
tournaments, raffles, even bake sales and car washes. As a society, it 
is wrong for us to expect people with devastating diseases to fund the 
search for their treatments. We need to make a more significant effort 
at the Federal level to fund studies of rare diseases and incentivize 
researchers to pursue them.

                         REGULATORY CHALLENGES

    NORD hosted a Summit in May 2009 at which we drew together 
approximately 300 participants from NIH, FDA, patient organizations and 
industry to focus on how to accelerate the development of treatments 
for rare diseases and how to ensure patient access to treatments. A 
point made by several speakers was that industry frequently develops a 
second product for a disease that already has one or more treatments 
rather than addressing a disease that has no treatment at all. This was 
attributed, at least in part, to reduced regulatory uncertainty once 
the first product is brought to market.
    A few weeks ago, the chairman of NORD's board of directors 
addressed a public hearing hosted by the FDA. His recommendation, on 
behalf of NORD, was for FDA to reduce regulatory uncertainty and 
increase consistency by implementing a statement of policy on 
regulation of therapies for rare diseases.
    Only about 200 of the nearly 7,000 rare diseases currently have 
FDA-approved treatments. To NORD and the patient community, it appears 
as if the low-hanging fruit have been harvested since enactment of the 
Orphan Drug Act in 1983, but much more remains to be done.
    While orphan drugs are reviewed with the same standards of safety 
and effectiveness as other drugs, FDA publicly acknowledges that it 
exercises its scientific judgment in taking into account the special 
challenges of developing treatments for very small patient populations. 
However, without a statement of policy on rare diseases and orphan 
products, it is not possible to ensure consistency in that process.
    Other uncertainties in the regulatory arena include the need for 
identification and agreement on clinical endpoints and surrogate 
markers, the need for greater transparency and understanding of the 
regulatory process, and the need to have regulators who understand the 
special challenges of developing orphan products. NORD applauds the 
recent creation of an Associate Director for Rare Diseases position in 
FDA's Center for Drug Evaluation and Research (CDER) and the inclusion 
in the current Senate Appropriations bill of funding for staff to 
assist the associate director.

                        REIMBURSEMENT CHALLENGES

    Certain metabolic diseases, such as phenylketonuria, require 
specialized infant formulas and medical foods as a very important part 
of treatment. Patients who don't get these special foods may suffer 
very serious consequences, including severe mental retardation. 
However, insurers (including Medicaid) don't always reimburse for the 
cost of these foods since they are not prescription drugs.
    Only about a third of the States currently mandate reimbursement 
for the costs of specialized infant formulas and medical foods. Since 
these foods have been demonstrated to be an important part of medical 
treatment for children with certain diseases, NORD feels strongly that 
access should not be hindered as a result of inability to pay. We would 
like to see a Federal mandate to ensure that no child is denied a 
needed medical food because of failure by insurers to provide coverage.
    Another reimbursement issue is the off-label use of drugs for rare 
diseases. It has been estimated that 90 percent of the nearly 30 
million Americans with rare diseases are treated off-label simply 
because there is no FDA-approved therapy for them. As the cost of 
healthcare continues to skyrocket, insurers (both public and private) 
increasingly are denying coverage for off-label use of drugs, 
biologics, and medical devices on the basis that such therapy is 
experimental. For people with rare diseases who have no other options, 
this is becoming a serious problem.
    NORD does not want to discourage pharmaceutical and biotechnology 
companies from conducting clinical trials to obtain FDA approval for 
these additional uses. However, we feel that legislation might be 
employed appropriately to help rare-
disease patients and families obtain reimbursement for off-label 
treatment that is medically necessary when no FDA-approved options are 
available to them.

                        HUMANITARIAN USE DEVICES

    While we've been speaking primarily of orphan drugs and medical 
foods, clearly there is a need for the development of pediatric medical 
devices for many children with rare diseases. And NORD feels strongly 
that it is important to emphasize that children are not just small 
adults. Sick children need medical devices and drugs developed 
specifically for their unique needs, taking into account their smaller 
size, growing bodies, and active lifestyles.
    To illustrate the challenges inherent in development of medical 
devices for this particular population, we cite the experience of Dr. 
Robert Campbell, a pediatric orthopedic surgeon on NORD's Medical 
Advisory Committee, who is affiliated with the Children's Hospital of 
Philadelphia.
    Dr. Campbell invented, developed and brought to market a pediatric 
device known as the expandable titanium rib that has saved the lives of 
hundreds of infants and children who have a condition known as thoracic 
insufficiency syndrome. Prior to his work, there was no treatment for 
children with this condition, and most ultimately died because there 
was not enough room for their lungs to expand as the children grew. 
(Please see attachment 1)
    Dr. Campbell's research was made possible by a small seed-money 
grant from NORD, when no other funding was available. Later, he was 
able to obtain funding to continue the research through the FDA Orphan 
Product Development grant program. Ultimately, the device he 
developed--the titanium rib--was approved by FDA as a Humanitarian Use 
Device. Because no company was interested in manufacturing it, Dr. 
Campbell also took it upon himself to find a small company that would--
essentially for humanitarian reasons--agree to manufacture and market 
the titanium rib.
    The families helped by this medical device remain tremendously 
grateful to Dr. Campbell and his colleagues. But there are many others 
with other rare diseases who may not have a Dr. Campbell, and they need 
help, too.
    A complicating factor is that, while FDA considers HUDs to be 
approved, they must still be reviewed by IRBs. As a consequence, 
insurers (both public and private) consider them experimental and may 
not reimburse for them. In addition, while pediatric HUD developers can 
now realize a profit, this is not the case for all humanitarian 
devices. The prohibition against developers profiting from these 
devices needs to be lifted.

                           MEDICAL EDUCATION

    NORD works very closely with the medical community, and we know 
that our Nation is blessed with a caring and dedicated medical 
establishment. However, we feel that medical education in the United 
States does not adequately address issues and challenges related to 
rare diseases, and is not at this time encouraging enough young 
scientists to engage in both research and clinical care related to rare 
diseases. Given the fact that approximately 1 in 10 Americans are 
affected by rare diseases, we believe a greater emphasis on these 
diseases is warranted in our centers of medical education.
    One of the primary problems encountered by rare-disease patients 
and families is delay in obtaining an accurate diagnosis. In 2003, NORD 
partnered with Sarah Lawrence College on a study to replicate, on a 
smaller scale, an earlier study by the Federal Government of problems 
experienced by people with rare diseases. Sadly, our study showed that 
the diagnosis problem remained essentially unchanged since the Federal 
Government's study done in 1989.

          SOME CURRENT INITIATIVES THAT BRING HOPE TO PATIENTS

    Currently, NORD is working with FDA, NIH and others to address some 
of the problems outlined above and to accelerate the development of 
rare disease therapies. These initiatives include:

     A three-day training course for investigators from 
academia and small biotechnology and pharmaceutical companies involved 
in conducting research to develop treatments for rare diseases. This 
course will be taught by experienced faculty from academia, industry, 
NIH and FDA, and is being sponsored by NORD, FDA, NIH and Duke 
University. It will result in the development of a handbook for rare-
disease investigators.
     A task force instituted by NORD, in which NIH and FDA have 
agreed to work together to examine the interface between the two 
agencies, identify weaknesses, and find ways to work together more 
effectively to facilitate the development of safe, effective treatments 
for patients. This task force has already had several meetings.
     A series of orphan designation workshops being hosted by 
the FDA Office of Orphan Products Development, in partnership with NORD 
and others, to de-mystify the process of getting orphan designation for 
a product in development as a rare-disease treatment.
     A series of focus groups, hosted and sponsored by NORD, to 
gather information from academic researchers, patient advocates, the 
investment community, and the biopharmaceutical industry to help NIH 
and FDA review current practices and consider possible improvements.
     An increasingly global response to the needs of rare 
disease patients, as evidenced by the partnership of NORD and its 
European counterpart, the European Rare Disease Patient Organization or 
EURORDIS.
     The launch of a Congressional Rare and Neglected Diseases 
Caucus, advocated by NORD and its partners, to help focus attention on 
these important issues and how to address them.

                          OUR RECOMMENDATIONS

    In general, our recommendations to this committee, reflecting what 
we've learned over the past 27 years as well as our current assessment 
of the most critical needs of patients at this time, are as follows:

     Continued progress in areas such as the NORD Task Force 
through which NIH and FDA are identifying ways to work together more 
effectively; the Rare and Neglected Diseases Congressional Caucus; and 
the development of a handbook to serve as a roadmap for rare-disease 
clinical investigators.
     Federal funding and guidelines to develop natural history 
data, patient registries, epidemiological data and other basic tools to 
support research.
     Recognition that clinical trials related to rare diseases 
are, by their nature, different from studies of more common diseases 
and that they represent a unique set of circumstances and needs.
     A renewed Federal commitment to funding research on rare 
diseases through offices such as the NIH Office of Rare Diseases 
Research.
     Reduced regulatory uncertainty through steps such as 
greater transparency of FDA practices and creation of an FDA statement 
of policy on rare diseases and orphan products.
     Incentives to encourage young investigators to study rare 
diseases.
     Increased emphasis on rare diseases in our centers of 
medical education.
     Adoption of the funding proposed in the current Senate 
Appropriations bill for the FDA Orphan Products Research Grants Program 
and to staff the new associate director function in FDA CDER.
     Assessment of reimbursement issues related to medical 
foods and off-label treatment for children with rare diseases.
     Training in rare diseases and orphan product development 
for FDA reviewers and staff involved in review of orphan products.

    In closing, I would like to reiterate several very important 
points:

    1. Among patients afflicted with any of the 350 most common rare 
diseases, 27 percent will not live to see their first birthday.
    2. Patients and their families are willing to take on a far greater 
degree of risk than those affected by more common conditions.
    3. Understanding the pathogenesis of rare diseases will advance the 
scientific and medical understanding of common conditions.

    Chairman Harkin and Ranking Member Enzi, thank you once again for 
allowing NORD to testify before you today.

    Senator Brown. Thank you, Ms. Dorman.
    Mr. Crowley.

    STATEMENT OF JOHN F. CROWLEY, PRESIDENT AND CEO, AMICUS 
                   THERAPEUTICS, CRANBURY, NJ

    Mr. Crowley. Great. Thank you, Senator Brown.
    Senator Brown. Thank you.
    Mr. Crowley. Thank you, Senator Brown--and thank you for 
the leadership in the Rare Disease Caucus--Senator Enzi, 
Senator Sanders, Senator Casey.
    I come here wearing a number of hats today. I come as the 
chairman and chief executive officer of a small biotechnology 
company, Amicus Therapeutics, a 100-person company in Cranbury, 
NJ, developing novel medicines for human genetic diseases. I 
come also as a member of the board of directors of the Biotech 
Industry Organization. But, most importantly, I come as the 
father of two children with a rare disease, as you alluded to 
in your kind introduction, Senator, Megan and Patrick.
    My whole involvement in this industry goes back to that 
1998 diagnosis. My wife and I were a year out of graduate 
school, 31 years old, and we are recessive carriers for a gene 
to cause this fatal neuromuscular disease, Pompe, so there's no 
history of it in our family. We were told, in March 1998, that 
our then 15-month-old daughter, Megan, and our then 7-day-old 
son, Patrick, had this rare form of a muscular dystrophy. We 
were told that there was very little research, there was no 
drug in clinical development, and the doctor said, most 
apologetically--he said, ``I'm sorry. There's nothing we can 
do. They'll live maybe another year or two.''
    What has happened in the last 12 years, I think, could only 
happen in the United States. It was a common effort by a lot of 
people who worked incredibly hard, tirelessly. And I think it's 
representative of what is very unique about drug development in 
America, this virtuous circle, where it was years of academic 
research; it was researchers at the NIH; it was reviewers at 
the FDA; it was philanthropist patient advocates; a small 
biotechnology company that I started; more out of frustration 
with the pace of development than anything, to just try to move 
the ball a little bit; it was venture capitalists; it was 
eventually large biotech companies. And from 1998 to 2006, we 
helped to develop a drug eventually brought to market by a 
large biotechnology company, Genzyme. And with that, it was 8 
years of clinical development, almost $500 million of 
investment--almost exclusively private industry investment--to 
bring the medicine to just a couple thousand people in the 
United States and around the world.
    With Pompe disease in children, there is a severe 
enlargement of the heart. Our kids' hearts were two to three 
times normal size when they went into the clinical study. 
Within months, their hearts shrunk back down to normal. We saw 
significant improvements in their muscle strength.
    Years later, they still take that medicine--every other 
week, a 6-hour infusion. It maintains their strength. It keeps 
their heart healthy. It is still not a cure. It is a first-
generation approach. They're still in wheelchairs. They're 
still on ventilators. They are now, I'm happy to report, 13 and 
12 years old, going into the eighth and seventh grades--
amazingly smart and vibrant and precocious little kids.
    We had the incredible experience of having this movie, 
``Extraordinary Measures,'' made about our lives that came out 
just earlier this year. And it was a very positive experience 
for our family--at times, very surreal. But, in many ways, 
Megan and Patrick, in that film, are proxies for millions of 
other children, some of whom have received life-saving 
medicines, medicines that never would have come about without 
the efforts of a lot of people and the Orphan Drug Act, 27 
years ago. But, probably even more significantly, I think they 
really represent the millions of children who still strive for 
therapies, who need cures, who need development, who need that 
virtuous cycle of development that we've put in place, in the 
last many decades in the United States, to not only continue, 
but to grow and to thrive.
    And with all those different hats I wear, I can tell you 
I'm very concerned that, on one hand, we sit on what I think is 
a Golden Age of Medicine, in the next 10 or 20 years, as we 
look at all the technologies in development in universities, at 
the NIH, in private industry--so much potential to 
fundamentally alleviate human suffering, to cure these 
diseases, to provide breakthroughs that could ultimately affect 
much more broadly prevalent disorders, like Parkinson's and 
Alzheimer's, diseases that really are genetic diseases at their 
core.
    But, as an industry, we look at things like the financial 
markets. For small biotechnology companies, venture capital 
funding is down 30 percent. Much of that doesn't go into the 
risk-taking enterprises that are typically involved in this 
development.
    IPOs in our industry--there were 35--our company was one of 
them, in 2007. In the last 5 years, there have been five. Our 
company, in 5\1/2\ years, has raised $300 million, and spent 
over $200 million, to develop a handful of drugs for very rare 
human genetic diseases, none of which are still approved. Our 
lead drug has been in clinical studies now for 5 years, through 
phase 1; safety studies through phase 2; proof-of-concept 
studies; and now, in what will be a fairly lengthy time to 
enroll, hopefully by the end of this year, a phase-3 study to 
prove its safety and efficacy. All in, my guess is, it will be 
$200 million to develop that drug, and that it will have taken 
7 years of clinical studies for a drug that's probably going to 
help a couple thousand people with a rare disease called Fabry 
disease.
    That paradigm can't continue. We can't raise that type of 
money. We can't do 7 years of clinical work.
    In 1992, the AIDS community was very active, and they got a 
drug called AZT approved, the first treatment that started to 
check the disease, HIV. In the 20 years since, under the 
subpart H regulations of the FDA for accelerated approval, 
approval based on a surrogate endpoint, almost 20 drugs for 
AIDS have been approved, much, much to the benefit of that 
community, and rightfully so.
    In those 20 years, just one drug for a human genetic 
disease has been approved under those accelerated standards.
    I think, with that, some of the proposals that, as a dad, 
as an entrepreneur, and as an industry representative, we 
support are: urging the FDA to issue new guidance and review 
standards for demonstrating the efficacy and safety of rare 
diseases; greater use of surrogate endpoints likely to predict 
clinical benefit; much faster timelines; ultimately, I think, 
the ability to accept higher levels of risk--I think the mantra 
should be ``approve fast and follow long.'' We should look at 
funding the Cures Acceleration Network. I think that's a good 
example of public/private partnership that can play a role for 
the most rare of the rare diseases. I think, too, promoting 
industry--in the fact that industry is the one that develops 
all of these drugs through capital markets incentives, 
extending and expanding the Qualifying Therapeutic Discovery 
Project Tax Credit, I think will be incredibly important.
    I thank all of you for the time. This is obviously an 
incredibly important issue to all of us. I think it will be 
incredibly important going forward. And I look back to 1984, 
when Ronald Reagan signed the Orphan Drug Act into law. It was 
a very bold move, and it was with full Democrat and Republican 
support. When he signed that bill in the White House, he said, 
``I only wish, with the stroke of this pen, that I could also 
decree that the pain and suffering of people living with these 
diseases would cease, as well.'' It didn't, with the stroke of 
that pen, but it set in place a whole new framework, a system 
of incentives, the patient advocacy movement, itself, that has 
led to a significant number of cures. We need to take it to the 
next level. Maybe we need a second Orphan Drug Act to address 
these challenges.
    But, hopefully we can get to the day where fewer and fewer 
parents have to sit in that doctor's office and hear what we 
heard 12 years ago, a doctor saying, ``I'm sorry, there's 
nothing we can do.'' I think we can do much better.
    Thank you.
    [The prepared statement of Mr. Crowley follows:]

                 Prepared Statement of John F. Crowley

                              INTRODUCTION

    Good afternoon Chairman Harkin and members of the committee. My 
name is John F. Crowley of Princeton, NJ. I am the chief executive 
officer and chairman of Amicus Therapeutics, Inc. and I serve on the 
board of directors of the Biotechnology Industry Organization (BIO). 
More importantly, I am the father of two children diagnosed in 1998 
with Pompe disease--a rare and devastating neuromuscular disorder. I 
appreciate the opportunity to be here today to talk about ways in which 
the Federal Government can encourage and speed the development of 
drugs, vaccines, and diagnostic tests for rare and neglected diseases.
    Amicus Therapeutics is a 100-person biopharmaceutical company 
developing orally administered, small molecule drugs called 
pharmacological chaperones, a novel, first-in-class approach for 
treating a broad range of human genetic diseases. Amicus' lead program 
is in Phase 3 testing for the treatment of Fabry disease, a rare and 
severe lysosomal storage disease affecting an estimated 10,000 
individuals worldwide. My involvement with the biotechnology industry 
stems from that 1998 diagnosis of our two youngest children, Megan and 
Patrick.
    BIO represents more than 1,200 biotechnology companies, academic 
institutions, State biotechnology centers and related organizations 
across the United States and in more than 30 other nations. BlO members 
are involved in the research and development of innovative healthcare, 
agricultural, industrial and environmental biotechnology products, 
thereby expanding the boundaries of science to benefit humanity by 
providing better healthcare, enhanced agriculture, and a cleaner and 
safer environment.
    From my perspectives as both a biotechnology entrepreneur and as a 
father, I am most appreciative that the committee is undertaking this 
broad inquiry into the state of rare and neglected pediatric diseases. 
The time to consider change and to build on past successes could not be 
better. We have come a long way but we have much further to go to 
address the severe unmet medical needs of people who bravely live with 
these rare diseases, especially children. Research and drug development 
in this crucial field is at a precarious tipping point.

             THE FOUNDATION OF SUCCESS: THE ORPHAN DRUG ACT

    The Orphan Drug Act (ODA) of 1983 has brought unprecedented 
success. It contained several market-based incentives for biotechnology 
and pharmaceutical companies to develop and market products for rare 
diseases. To date, in excess of 1,000 orphan product designations have 
been granted by the FDA's Office of Orphan Product Development and more 
than 250 drugs and biologics have received approval by the FDA with 
Orphan designation, collectively helping millions of adults and 
children with rare diseases worldwide. We have come a long way, indeed. 
In the decade prior to enactment of the ODA fewer than 10 products for 
rare diseases came to market. Among these advancements are 
accomplishments that I have participated in professionally and, in the 
case of my own children, have witnessed most personally. Today, there 
are an estimated 7,000 rare diseases, each one affecting 200,000 or 
fewer individuals, but collectively affecting nearly 30 million 
Americans. Treatments exist for only a fraction of these devastating, 
life-threatening diseases leaving so many people of all ages with 
significant unmet medical needs. And of those treatments, the majority 
of approved orphan drugs are for those rare diseases with higher 
prevalence.
    BIO believes that the lesson we can learn from the ODA is that 
government policies can effectively foster research and development of 
products for rare diseases--and create an entirely new marketplace to 
meet severe unmet medical needs. The challenges of developing orphan 
products are great and they require innovative policy and regulatory 
solutions. Further, many rare diseases affect far fewer patients than 
the 200,000 threshold in the ODA. For these diseases, the challenges 
are even more daunting.

                      CONTINUED UNMET MEDICAL NEED

    The gap in development for pediatric rare diseases is particularly 
acute for the most uncommon disorders, which collectively still affect 
the majority of children with rare diseases. Most all rare or orphan 
diseases with lower prevalence remain without treatment. According to 
an Orphan Drug Development Trends report published by BioMedical 
Insights in January of this year, 83 percent of rare diseases are 
``ultra-rare,'' yet only 11 percent of orphan designations issued 
between 1997 and 2009 were for these ultra-rare diseases (144/1,310). 
What do these numbers translate to for the average patient family in 
the rare disease community? No treatment options and the invariable and 
painful words from a physician that are all too common: ``I am sorry. 
There is nothing we can do. There are no treatment options for your 
child.''
    For most of these rare and extremely rare diseases, perhaps as many 
as 2/3, medical research is absent--completely. Affected patients, 
their families and friends strive to bring attention to their causes. 
For other diseases, such as Tay-Sachs, for example, medical research is 
just now gaining momentum, despite it being one of the most commonly 
known rare, genetic diseases, with one of the oldest advocacy groups in 
the country, and the first disease for which a carrier genetic test was 
perfected back in 1970. Yet it could be many more years before a safe, 
effective treatment is ready for the clinic, and tens of thousands of 
children and adults will still die from this deadly neurodegenerative 
disease. As a past-president of the National Tay-Sachs & Allied 
Diseases Association, I've seen the hope sustained by parents listening 
to academic researchers, while they watch Tay-Sachs ravage their young 
children physically and mentally. And for those rare diseases fortunate 
to have a treatment, not all is perfect. As can be the case with Pompe 
disease, for example, many patients cannot tolerate the treatment due 
to immunogenicity or other significant issues. For others, the 
treatment may be of limited effectiveness but there are no other 
options. Much work remains to be done in orphan drug development to 
evolve the unmistakably critical work already achieved for rare 
diseases.

                     ABILITY TO MEET THE CHALLENGES

    In the year 2010, we have the collective ability to tackle the 
challenges of understanding and developing viable treatment options for 
rare and ultra-rare diseases with unmet medical need, especially for 
children. Basic scientific, biomedical and preclinical research is 
taking place with groundbreaking technology in laboratories at colleges 
and universities, independent academic medical centers, at the National 
Institutes of Health, and in the biotechnology industry. Initiatives 
such as the Therapeutics of Rare and Neglected Diseases (TRND) Program 
at the National Human Genome Research Institute (NHGRI) have impressive 
capabilities and hold great promise for discovery at the level of 
public/private collaboration that is necessary to help address many of 
these challenges. In particular, this is a new and exciting approach to 
moving forward from screening and developing compounds through the 
junctures of pre-clinical and clinical work, optimizing resources and 
harnessing the varied expertise of collaborators along the way.
    Though just getting off the ground, the TRND program has the 
potential to help companies bring promising products forward. Many of 
these products stall in development because biotech companies lack the 
financing to advance them. The TRND program could fill some of these 
funding gaps. BIO is encouraged by this effort. We pledge to work with 
the NIH on intellectual property concerns, technology transfer rules, 
and other matters to make sure the program accomplishes its goals.
    Patient advocacy for pediatric rare diseases is increasingly 
important. Families and friends of children and adults affected by 
these debilitating, horrific, often fatal rare diseases no longer 
passively sit around sick rooms and hospital rooms. They--we, because I 
am one of them, are well aware of the promising developments taking 
place in the research labs of the biotechnology industry and at 
academic institutions and are confident that technology can match our 
sense of urgency. Patient advocates are proactive agents for changing 
how this research can be conducted and how quickly it gets translated 
to the clinic, all with the hope that it will positively influence 
their loved one's clinical outcome. Today's patient advocacy and 
disease organizations are partners in social and venture philanthropy 
with industry. They want the exciting and promising technology that 
exists for their diseases to see the light of day, and even more they 
want treatments and potential cures to be realities in their lifetimes. 
Here are just two examples.
    The Cystic Fibrosis Foundation is one such health venture 
philanthropist. In 2000, there were few potential treatments in the CF 
pipeline. Today, there are more than 30 treatments in development, a 
few already available to patients, with a pipeline portfolio ranging 
from gene therapy, protein rescue, mucus alteration, restoring airway 
surface liquid (ion transport), anti-inflammatory, anti-infective, 
transplantation and nutrition. In the area of protein rescue alone, the 
CF Foundation invested more than $100 million with Vertex 
Pharmaceuticals and $25 million with PTC Therapeutics, both fellow BIO 
member companies, for two different small molecules in the past few 
years.
    ``Fight Spinal Muscular Atrophy'' (FightSMA) dedicates itself to 
research for a cure for this group of diseases which affect the motor 
neurons of the spinal cord and brain stem. In its infantile form, SMA 
kills more babies than any other genetic disease. With grants up to 
$250,000 each, FightSMA is a social philanthropy funding about 20 
academic and medical institutions in the United States and 
internationally. The organization brings approximately 25 SMA 
researchers together for an annual scientific conference to encourage 
collaboration at the same time that SMA-
affected families come to meet each other for support and learn from 
these researchers.
    It is exactly this type of community-driven, cross-fertilization 
and financial support of ideas, and sharing of disease experience that 
has occurred at advocacy organization conferences for years that the 
patient community is more recently asking take place on a broader scale 
in clinical research and drug development. Patients are appreciative of 
the active role of the Office of Rare Diseases at NIH in supporting 
these meetings and of the Office of Orphan Product Development 
participation at many programs. Collaborative approaches are in the 
United States and abroad, originated by highly respected organizations 
such as NORD and now assumed by their counterparts, such as EURORDIS, 
CORD and ICORD. The 2010 European Conference on Rare Diseases held last 
month in Krakow, Poland, attracted more than 600 participants from 43 
countries, with one-third from Eastern Europe: the aim to discuss 
public policies and actions that will improve the lives of people with 
rare diseases. The rare disease community may be growing, but it 
represents a world that is getting smaller all the time. The demands of 
the diseases themselves have always been there; however, the presence 
of the diseases is augmented by the fast-paced technology available to 
researchers, the charged atmosphere of advocacy, immediate access to 
information about diseases, research and support groups, and 
connectivity through the Internet and social media for all disease 
stakeholders.
    Collectively, these activities represent a trend toward 
acceleration of all aspects of orphan drug development to ultimately, 
and most importantly, benefit patients living with rare diseases. The 
Federal Government can support new policies and programs that extend, 
leverage and enhance these global efforts.
    The biotechnology industry has made a significant contribution to 
this field over the years. Indeed, the mission of many biotech 
companies, such as my own, is to bring hope to the patients who suffer 
from rare diseases. Today, I would like to provide you with some 
thoughts about policies that will complement and advance the objectives 
of the ODA and facilitate the development of the next generation of 
orphan products for children.

   New Policies for Consideration to Accelerate Treatments for Rare 
                         and Neglected Diseases

  CHANGING THE FDA REGULATORY ENVIRONMENT FOR PEDIATRIC RARE DISEASES

    The committee must address the current regulatory environment and 
the FDA's review process for orphan products. For instance, the sheer 
size of patient populations is an important factor for consideration in 
clinical study design. Affected individuals are part of such small 
individual patient populations; they may represent disease prevalence 
of as many as 67:100,000 to as few as 2:100,000. No one rare disease 
exceeds an incidence of 200,000 in the United States. Limited 
individual disease experience makes it unlikely that there are 
organized registries from which to draw information for the majority of 
these diseases, and unrealistic to consider conducting natural history 
studies as prelude to or in parallel with clinical trials. (The topic 
of disease and product registries currently is a controversial one in 
the rare disease community and one worth exploring, as well.) Numbers 
of subjects for any orphan product study should be carefully considered 
based on current disease situations. Given that these trials, 
especially registration studies requiring larger numbers of subjects, 
typically necessitate global recruitment, protocols should be able to 
satisfy institutional review boards and ethics committees 
internationally. In the ultra-rare category, consideration also should 
be given to combined Phase 1/2 and Phase 2/3 studies with a Phase 4 
commitment from sponsor companies making these investments. The 
regulatory mantra should be: Approve fast, follow long.
    The committee should respectively consider enabling the FDA to 
focus on orphan diseases/orphan products beyond the fine work already 
being conducted by the Office of Orphan Product Development. The multi-
systemic, complex nature of the majority of rare diseases, as genetic, 
metabolic, inborn errors of metabolism, further complicates a simple 
route forward for the guidance and development of well-
designed clinical protocols. Therefore, study design guidance and 
review for rare diseases should also have an approach 
characteristically distinct from that used with common disease guidance 
and review. The FDA would benefit from a dedicated team of experts in 
the genetic and metabolic disorders that together with regulatory 
colleagues can offer guidance to study sponsors that will result in 
clinical protocols that account for limited patient numbers, the most 
current collective thinking on disease biomarkers, surrogate endpoints 
and better use of pharmacogenetics.
    I suggest that the establishment of a separate Division of Genetic 
and Metabolic Disorders at FDA is essential and long overdue. Along 
these same lines, the Agency might consider having reviewers, staff 
other than OOPD, spend more time with rare disease patient 
organizations to learn from their leadership and members what they 
think and know of clinical trials, barriers to participation, etc. This 
might be mutually beneficial for educational purposes and understanding 
the rare disease patient experience.
    Additionally, BIO urges FDA to publish further guidance regarding 
orphan drug development that provides interpretation of current 
regulations including: what are acceptable subsets of disease to meet 
the prevalence requirement; what is a ``major contribution to patient 
care'' that allows a drug to be found ``clinically superior'' even if 
it has the same active moiety of a previously approved drug; what is 
the definition of ``reasonably likely to predict clinical benefit,'' 
and whether the sponsor of the original drug can also be a ``subsequent 
sponsor.''
    Other regulatory changes should be pursued as well. For example, we 
urge that FDA review use of its standards for demonstrating efficacy of 
a rare disease product. The requirement for sponsors to use two 
adequate and well-controlled studies is the same standard used by the 
Agency for other drugs and biologicals. However, it is significantly 
harder to develop those studies for rare disease products because of 
the small patient populations available. This is particularly true for 
very rare diseases. BlO urges FDA to consider alternatives that 
include: approval based on a single adequate and well-controlled trial 
at a ps.05, if there have been NIH-conducted studies using the same 
populations; use of consortia between government, academia and 
industry; and use of patient registries for rare diseases as part of 
efficacy considerations.
    In addition, we urge FDA to support greater use of surrogate 
endpoints for product approval, either for full approval or accelerated 
approval purposes. Although they currently can be used during the 
accelerated approval process, more guidance from the Agency is needed 
on use of surrogate endpoints for registration. Amazingly, in the past 
20 years, only one drug for the treatment of a human genetic disease 
was approved under the ``accelerated approval'' provision of subpart H 
of the FDA regulations.
    Moreover, BIO believes FDA can improve communications processes for 
rare disease stakeholders. For example, once orphan designation has 
been granted, there is no communication policy for sponsors as the 
review divisions take over. This often makes interaction with the 
Agency difficult. It is important that FDA encourage reviewers to 
establish communications processes that allow reviewers and sponsor 
researchers to discuss scientific issues based on real-time data more 
efficiently. Such real-time scientific dialogue would not take the 
place of the required regulatory communications and meetings with FDA 
but rather ensure that these required communications and meetings are 
utilized more efficiently. Additionally, there is no special priority 
given to rare disease products in current FDA practices regarding 
protocol assistance, communication with the Agency and other matters. 
Given the complexity and special challenges of developing rare disease 
products, these communication gaps impede development and approval.
    Other regulatory changes should be pursued as well, such as greater 
transparency at the Agency including more meeting opportunities, and 
greater consistency among FDA's review divisions. The challenges of 
developing rare disease products require new regulatory approaches. 
Also, in light of the fact that biomedical research and development is 
a global enterprise, we urge the FDA to work with foreign regulatory 
agencies, particularly in Europe, to harmonize requirements for 
pediatric research.
    In addition, many patients suffering from rare diseases are treated 
by products that are labeled for another indication. Companies looking 
to get FDA approval for the rare disease indication are often either 
prohibited or severely restricted from performing a placebo-controlled 
trial for that indication because the commercially available (off 
label) product has become the clinical standard of care. In such 
situations, FDA should allow non-placebo controlled trials such as 
historical control or open label trials.
    Regarding FDA's approval of medical devices for rare diseases, the 
use of different threshold numbers for defining rare (``orphan'') 
disease for medical device (4,000) versus drugs and biologics (200,000) 
is illogical. The device regulations should be changed, as it is the 
disease incidence not the therapy that should define the population.
    Finally, we note that the dual statutes governing pediatric 
research, the Best Pharmaceuticals for Children's Act (BPCA) and the 
Pediatric Research Equity Act (PREA), have been remarkably successful 
in ensuring that the medications used in children are tested and 
labeled appropriately for their use. Together BPCA and PREA have 
generated a wealth of pediatric drug information for physicians and 
parents. BPCA rewards drug companies with 6 months of additional market 
exclusivity after the completion of studies in children as requested by 
the Food and Drug Administration (FDA). PREA requires new drugs to be 
studied in children and allows FDA to mandate child studies in certain 
already marketed drugs. However, despite a proven track record in 
encouraging pediatric medical research, both programs are scheduled to 
expire in 2012. BIO urges Congress to recognize the success of these 
programs, eliminate the sunset provision, and make permanent the 
incentives for ongoing pediatric research.

         UNDERSTANDING AND ACCEPTING APPROPRIATE RISK TOLERANCE

    The required pre-clinical and clinical safety studies and risk 
assessments for the development and approval of life-saving pediatric 
drugs for rare diseases is virtually the same in all instances as for 
antibiotics for common ear infections. We need to better understand the 
risk/reward ratios for these rare diseases drugs. Addressing the 
tolerance for risk in drug development in the rare disease space is 
also essential to advancing newer therapies. Individuals directly 
affected by these highly unusual disorders, or their parents, custodial 
family members and caregivers are experiencing unusual, almost unique 
and unprecedented unmet need. They have a sense of urgency few if any 
can understand, but this does not necessarily cloud their judgment or 
ability to understand the risks and benefits of clinical trial 
participation. There should be no less scrutiny of safety for patients 
with ultra-orphan diseases but many of the traditional pre-clinical and 
clinical safety studies typically required of most drugs need to be 
reevaluated in the context of the cost and time associated and the 
severity of the unmet need.
    Certainly, the protracted timelines too often impose the ultimate 
cost on affected families awaiting treatment for their rare disease--
the loss of their child or other loved one. It behooves the FDA to 
reassess the process and the extraordinary financial costs involved in 
developing orphan drugs. For example, the last five drugs developed and 
approved to treat lysosomal storage diseases have cost more than $200 
million each in research and development expenses alone to develop, 
while addressing populations in the United States of less than 3,000 
patients. Each of these drugs were for use in children as well as 
adults. There is no current economic framework that exists to promote 
this kind of investment. While the industry is appreciative of the 
existing incentives established by the Orphan Drug Act 27 years ago, it 
is time to update these to ensure ongoing and future innovation to 
benefit rare diseases. Some very practical considerations are: 
investment tax credits, permanent R&D credits and tax grants for 
companies conducting research for ultra-orphan treatments, accelerated 
clinical studies, and special tax treatments for investments in smaller 
companies with fewer than 250 employees.
    BIO companies believe that FDA has made great strides to make sure 
that safe and effective orphan products reach patients as soon as 
possible, For example, we applaud the FDA Office of Orphan Products 
Development for their sponsorship of the training program for reviewers 
on statistical methods for small patient populations. In addition, the 
``Build an Orphan''--designed to help companies properly submit the 
application for orphan drug designation in a timely fashion--holds 
promise. But more must be done.
    The ODA created a grant program administered by the FDA to fund 
companies for development of orphan products. It's called the Orphan 
Drug Grant Program. This program has not had increases in funding 
commensurate with inflation for many years. BIO urges increased funding 
for the Orphan Drug Grant Program.
    Similar to what FDA has done through its Critical Path initiative, 
we believe the Agency also needs to take affirmative steps to spur drug 
development for rare diseases. The regulatory approval pathway simply 
must be more predictable. For example, during the most recent 
negotiations surrounding enactment of the Prescription Drug User Fee 
Act (PDUFA), the FDA committed to developing a series of guidances 
regarding clinical trial design; adaptive clinical trials; and new 
methods of statistical analysis. These would be valuable for developers 
of rare disease products. We appreciate the publication of the adaptive 
clinical trial guidance and the non-inferiority draft guidances 
released earlier this year, and we look forward to timely publication 
of other pending guidances on clinical trial design.

                  FUND THE CURES ACCELERATION NETWORK

    The recently enacted Patient Protections and Affordable Care Act 
(PPACA) includes a provision called the Cures Acceleration Network 
(CAN) that is intended to speed the translation and application of 
promising new treatments for diseases from the laboratory to the 
marketplace. The CAN will be placed under the Office of the Director of 
NIH, and is authorized to make grants through the NIH to biotech 
companies, universities, and patient advocacy groups to target 
applicants that have shown promise at the laboratory level, but have 
not been able to advance enough to attract investors that are willing 
to commit to a promising discovery.
    Specifically, CAN will focus on funding the development of ``high 
need cures'', defined as those which the NIH Director determines to be 
a priority to ``diagnose, mitigate, prevent or treat harm from any 
disease and condition'' and for which commercial incentives are 
unlikely to result in timely development. The functions of CAN will be 
to not only support research that would accelerate the development of 
high need cures, but to reduce barriers of getting discoveries that are 
in the lab into clinical trials, as well as facilitate the FDA review 
process.
    In regards to providing assistance with the FDA review process, CAN 
will work to facilitate communications with the FDA on the status of a 
high needs cure approval and ensure activities are coordinated in a 
manner that would expedite their development approval. Lastly, CAN will 
work to connect those developing high need cures with additional 
technical assistance.
    PPACA authorizes $500 million for fiscal year 2010 for the creation 
of two new grant programs. Importantly, these grant awards will be 
available to biotech companies, medical centers, universities, disease 
advocacy organizations, patient advocacy organizations, pharmaceutical 
companies and academic research institutions.

  EXTEND AND EXPAND THE QUALIFYING THERAPEUTIC DISCOVERY PROTECT TAX 
                                 CREDIT

    One provision included in the health reform law that may be of 
enormous benefit to small life sciences companies is the Qualifying 
Therapeutic Discovery Project Credit program, now section 48D of the 
tax code. Modeled after existing tax credits for investments in 
advanced renewable energy efforts, this program creates $1 billion of 
tax credits or grants to encourage investments in promising new 
therapies to prevent, diagnose, and treat acute and chronic diseases. 
For qualifying companies with 250 employees or fewer, this program will 
provide immediate funding for work on therapies for cancer and other 
debilitating conditions, including a number of rare diseases, while 
providing small firms the ability to weather the ongoing economic 
storm. Without help to these companies, the effects of the financial 
crisis and the resultant capital markets contraction threatens to halt 
or significantly delay the next generation of promising therapies for 
various diseases and afflictions that affect tens of millions of 
patients and their loved ones.
    Today, July 21, is the deadline for applications for the 
therapeutic credit program. While Congress saw fit to fund this program 
with $1 billion, the Treasury Department has estimated that more than 
1,000 applications could easily be filed. In reality this number could 
be closer to 2,000. Whatever the number of applications, it is clear 
that there will be many more promising projects than can be funded 
under the initial $1 billion.

                               CONCLUSION

    I agree with President Obama's statement that,

          ``science is more essential for our prosperity, our security, 
        our health, our environment, and our quality of life than it 
        has ever been before--including [the] creat[ion of] new 
        incentives for private innovation [to] promote breakthroughs in 
        energy and medicine.''

    Change does not come easily. It was not an easy process when a 
group of parents led by Abbey Meyers, the founder of NORD, spearheaded 
the development of the Orphan Drug Act in 1983. In January 1984, when 
Ronald Reagan signed the Orphan Drug Act into law, with Democrats and 
Republicans at his side, he stated that, ``I only wish that with the 
stroke of this pen that I could also decree that the pain and suffering 
of people living with these diseases would cease as well.'' It didn't, 
but the act did create an environment with a system of special 
incentives for industry and certain government-supported programs that 
spawned a new era of research and drug development. We have come very 
far in that last quarter of a century but we have much further to go. 
The change brought about by the Orphan Drug Act improved millions of 
lives in this country and abroad, helped launch an industry and 
established the global rare disease advocacy movement. It does not come 
easily for every family that struggles with illness and then receives a 
life-altering diagnosis of a rare disease with no treatment or cure. But 
each of us committed to orphan drug development, including the FDA and 
those responsible for seeing the Agency is appropriately funded, owe 
those families a more-than-fighting chance that their medical needs 
will be met and that more and more parents will instead receive a 
diagnosis of a rare disease in their child, followed immediately by the 
words: ``There are, however, several treatments options for your 
child.''

    Senator Brown. Thank you, Mr. Crowley, for your story.
    Ms. Moon, welcome.

STATEMENT OF SUERIE MOON, BOARD MEMBER, DOCTORS WITHOUT BORDERS 
                       USA, NEW YORK, NY

    Ms. Moon. Thank you, Senator Brown, Ranking Member Enzi, 
Senator Sanders, and Senator Casey.
    My testimony today is based on our decades of experience as 
one of the only actors providing treatment and care for 
neglected diseases in the developing world. It's also based on 
our experience as a founding member of the Drugs for Neglected 
Diseases Initiative, or DNDI, which is a public/private product 
development partnership. Our support to DNDI makes us the 
third-largest philanthropic funder of neglected disease 
research in the world.
    In a nutshell, we're facing two different types of problems 
in addressing neglected diseases in developing countries. 
First, there's very limited access to the tools that already 
exist to diagnose and treat these diseases. But, at the same 
time, the tools that we have are terribly insufficient. We 
urgently need innovation and new and better products in order 
to address these diseases. We need products that are effective, 
that are easier to use, and that are well-adapted to field 
conditions in resource-poor settings.
    Globally neglected diseases affect what are often called 
the ``bottom billion,'' people who live in the most rural 
areas, who have little or no access to healthcare, and who are 
often living on as little as a dollar or less per day.
    Therefore, it was welcome news for us, in 2008, when the 
Presidential Initiative on Neglected Tropical Diseases was 
established. However, the initiative only focused on 5 of the 
14 neglected tropical diseases that were identified by the 
World Health Organization. It did not fund diagnosis and 
treatment of the deadliest neglected diseases, such as Chagas 
disease, sleeping sickness, and kala azar. These have been 
identified, in fact, as the most neglected, and are the focus 
of a number of MSF programs.
    Many of you in this room may never have heard of these 
diseases. They often occur in remote areas or in countries that 
are undergoing political instability. Because of time 
constraints, I won't go through and describe each of them to 
you, but perhaps I could tell you a little bit more about one 
of them, Chagas disease, because it infects about 300,000 
people in the United States today, as well as 15 million people 
around the world.
    It's the largest parasitic killer in the Americas, and is 
responsible for about 14,000 deaths every year. The disease is 
caused by a parasite that's transmitted by what's called the 
``kissing bug,'' because the bite of the bug is so gentle that 
victims often don't even know that they've just been infected. 
Chagas disease can also be transmitted from mother to child 
during pregnancy, so it infects infants, through blood 
transfusions and organ transplantation, as well as through oral 
transmission. If left untreated, it eventually infects the 
heart and the digestive system, and kills 30 percent of those 
who are infected.
    Despite its deadly effects, we don't have many tools to 
combat Chagas disease. For example, currently we only have two 
medicines, nifurtimox and benznidazole. Both were developed 45 
years ago, and neither of them were developed specifically in 
research aimed at Chagas disease. Neither of these drugs are 
currently adopted for use in children, although, in the coming 
months, we hope to have a pediatric formulation of benznidazole 
made available.
    Furthermore, there's no tests for cure for Chagas disease. 
So, once a patient has gone through a treatment course, we 
still don't know if they've actually been cured of the disease. 
We urgently need new diagnostic tests, better medicines, a 
vaccine, and a test for cure to help prevent, diagnose, and 
treat this disease.
    Another area where we urgently need better innovation is 
for diagnostics for tuberculosis, or TB. In 2008, there were 
12,900 cases of TB here in the United States, and 9.4 million 
cases worldwide. TB is one of the world's leading causes of 
pediatric and adult mortality, causing nearly 5,000 deaths per 
day.
    However, the current system that we have for diagnosing TB 
in most developing countries is very weak. It detects less than 
half of all TB cases, and it detects even fewer among children 
and people who are living with HIV.
    So, I think the question that comes up is, Why don't we 
have better tools available to combat neglected diseases? It's 
precisely because the patients that we're talking about are 
poor and their needs get neglected. The current system that we 
have to incentivize R&D to develop new drugs, diagnostics, and 
vaccines is driven by commercial rewards. So, generally 
speaking, a company will develop a drug or diagnostic tool, 
then they'll receive a patent that allows them to sell the 
product at a high price, and the high price is, in turn, 
expected to cover R&D costs.
    But, the system fails miserably to meet the needs of people 
who cannot pay the high prices, either because there are too 
few of them, which is the case, of course, for orphan and rare 
diseases, or because they're too poor, which is often the case 
for neglected tropical diseases that affect millions of people. 
This is the reason why, between 1975 and 2004, only 1.3 percent 
of all drugs that were developed targeted tropical diseases or 
tuberculosis, even though these diseases account for 11.4 
percent of the global burden of disease.
    It's clear to me, then, that if we want new tools to combat 
these diseases, we need new incentive mechanisms. MSF believes 
that the key principle in evaluating and designing new 
incentive mechanism should be what we call ``delinkage.'' And 
what do I mean by this term? I think this term is relatively 
new here in Washington, so I'll take a few minutes to explain.
    Delinkage refers to the idea that we can separate the 
market from R&D from the market for product manufacturing. What 
I mean is that, on the one side, we can specify the kind of R&D 
that we need, generate competition amongst researchers, and 
then reward the best innovator, once they've solved the problem 
that we've set out.
    On the other hand, we have a market for production of the 
tool, whether it's a drug or a diagnostic or a vaccine. Once 
the product has been developed by the innovators, there would 
be no need to grant monopoly rights. So, what we could do is 
encourage a number of different manufacturers to enter the 
market, and encourage robust competition, to get the lowest 
sustainable prices.
    So, when I say ``delinkage,'' the link that we're breaking 
is, in fact, the link between high medicines prices and R&D. 
Because if high medicines prices are the only incentive we have 
for R&D, we're not going to get innovation and access for the 
needs of the poorest patients.
    Delinkage can stimulate R&D where there's no profitable 
market; that is, for the neglected, rare, orphan, or pediatric 
diseases that we've been hearing about this morning. But, 
because the product development process is long and uncertain, 
we need a range of different funding mechanisms that allow 
delinkage, either to push R&D at the beginning of the pipeline 
or to pull R&D at the end, and make sure that the right 
products make it through.
    One of the proposals I'd like to put on the table in front 
of you today is for prize funds. We believe that prize funds 
are an attractive pull mechanism that incorporates the 
principle of delinkage. A prize is essentially an award that 
would be provided for different stages of the R&D process. It 
could be provided for identifying biomarkers, for proof of 
concept, for product synthesis, or for the final product. Once 
a prize is awarded, as I mentioned before, there would be no 
need to give the innovator a monopoly to recoup their R&D 
costs, because we would have just paid for it.
    A well-designed prize offers a number of benefits, 
including: No. 1, the ability to drive R&D based on health 
needs; No. 2, allowing competition to determine the path or the 
team that's most likely to succeed, rather than relying on 
government or donors to do so; No. 3, it would attract a 
broader, more diverse base of potential solvers for the problem 
that we've identified; and No. 4, it allows us to build a lot 
of flexibility into the--I'm sorry--it gives us a lot of 
flexibility to build provisions into the prize to serve the 
public interest. For example, we can encourage collaboration, 
knowledge-sharing, and affordability provisions.
    A prize fund, we believe, could quickly be established for 
a TB diagnostic test that could be used at the point of care in 
resource-poor countries.
    In summary, we welcome the increased political attention 
being paid to the needs of the most neglected patients. 
However, we urge the U.S. Government to include the most 
neglected tropical diseases, by which I mean Chagas disease, 
sleeping sickness, kala azar, and Buruli ulcer, within the 
scope of the new Global Health Initiative. We ask the 
initiative to provide support for improved access to existing 
health tools, as well as to support the development of new and 
improved ones.
    In order to develop new and improved tools, what we need is 
to explore new innovation mechanisms that address the 
shortcomings of the existing system. The key principle to keep 
in mind is delinkage; that is, breaking the link between high 
medicines prices and the funding of R&D. We believe prize funds 
are one promising mechanism for generating innovation that 
meets the health needs of the poorest people on the planet. We 
ask this committee and the U.S. Government to support 
innovative new approaches, such as prizes, that can be 
established relatively quickly, such as for TB diagnostics. We 
also ask the committee to consider prizes for other areas of 
neglected innovation, such as Chagas disease. At the same time, 
we urge the United States to support more systematic long-term 
changes that are needed to improve sustainable financing for 
health-needs-driven R&D that ensures equitable access to the 
end products. And important discussions are currently taking 
place at the World Health Organization and the Pan American 
Health Organization in this regard.
    In closing, there's increasingly widespread recognition 
that the existing R&D system is failing. I think the previous 
speakers on the panel illustrated that very clearly. It's 
failing patients with neglected tropical diseases, with orphan 
or rare diseases, and children, among others. Now is the time 
to begin testing new approaches to generate the innovation that 
we need to meet global public health needs.
    Thank you very much for this opportunity to share our 
experience.
    [The prepared statement of Ms. Moon follows:]

                   Prepared Statement of Suerie Moon

                           EXECUTIVE SUMMARY

    Doctors Without Borders/Medecins Sans Frontieres (MSF) is an 
international independent medical humanitarian organization. For 
decades, MSF has been one of the only actors providing care and 
treatment to impoverished people suffering from neglected diseases, 
such as Chagas disease, kala azar, sleeping sickness and Buruli ulcer. 
Globally, neglected diseases target the bottom billion--those living in 
the most rural locations, with poor or no access to healthcare, and 
extraordinarily limited resources. As a founding member of the Drugs 
for Neglected Diseases initiative (DNDi), a product development 
partnership (PDP), MSF is also the third largest philanthropic funder 
of neglected disease research. The problems we face are twofold: there 
is limited access to the tools that exist to diagnose and treat these 
diseases, but the existing tools are also terribly insufficient--new 
products are urgently needed.
    However, the current commercially driven system for drug, 
diagnostic and vaccine development leaves many urgent health needs 
unanswered. New medicines for sleeping sickness were not developed for 
50 years despite pressing needs. There is no test to determine whether 
patients have been cured of Chagas disease after a course of treatment. 
A diagnostic tool for tuberculosis (TB) does not exist in a form 
appropriate for resource-poor settings. The populations afflicted by 
these diseases are simply too poor to provide adequate commercial 
incentives for R&D in a system that relies almost entirely on the 
ability to sell products at high prices to incentivize drug and 
diagnostic development. New incentive mechanisms are needed.
    MSF believes that de-linking the cost of R&D from the price of 
health products needs to be the key principle used to evaluate and 
develop mechanisms to stimulate R&D and ensure access. De-linkage would 
separate the market for R&D from the market for product manufacturing. 
The concept of de-linkage fully accepts that R&D costs money, but seeks 
alternative ways to fund it. By paying for R&D through financing rather 
than through product prices, de-linkage removes the need to incentivize 
R&D through high prices. In this way, de-linkage can also stimulate R&D 
where there is no profitable market--that is, for neglected, rare, 
orphan diseases, or diseases like pediatric HIV/AIDS. From our 
experience with DNDi, we know that a range of different funding 
mechanisms that allow de-linkage are needed, either to ``push'' R&D via 
up front funding (e.g., through PDPs) or to ``pull'' R&D to ensure that 
the right products reach the end of the pipeline.
    Prizes are one attractive ``pull'' mechanism for de-linking the 
markets for R&D and product manufacturing. The key potential benefits 
of a well-designed prize include: the ability to drive R&D based on 
health needs; allowing competition (rather than governments or donors) 
to determine the path or team most likely to succeed; attracting a 
broader, more diverse base of potential ``solvers'' to a problem; and 
the flexibility to build in provisions for collaboration, knowledge-
sharing, and affordability of end products. Prize designs can vary, and 
they can also be given for different stages of the R&D process. Prize 
funds would be promising, and could quickly be established, in at least 
two areas of urgent need: a point-of-care TB diagnostic test and new 
products for Chagas disease.
    In 2008, the U.S. Government established the Presidential 
Initiative on Neglected Tropical Diseases. However, the initiative only 
focused on 5 of the 14 most neglected tropical diseases identified by 
the WHO, did not fund diagnosis and treatment of the deadliest 
neglected diseases, and did not provide support for the development of 
innovative products for these diseases. MSF urges the U.S. Government 
to include the most deadly tropical diseases (Chagas disease, sleeping 
sickness, kala azar, and Buruli ulcer) within the scope of its new 
Global Health Initiative, and to provide support for improved access to 
existing health tools, as well as for the development of new and 
improved ones.
    We also urge the U.S. Government to craft its policies and mobilize 
its financial resources to support new incentive mechanisms that 
embrace the principle of de-linkage, such as prize funds, in order to 
generate the innovation that we need to improve the lives of the 
world's poorest children and families.
                                 ______
                                 
    Thank you, Chairperson Harkin, Ranking Member Enzi, and the Senate 
Health, Education, Labor, and Pensions Committee for calling for this 
important hearing. This is a critical moment of both need and 
opportunity for innovation and access for neglected tropical diseases.
    My name is Suerie Moon and I am on the U.S. Board of Directors of 
Doctors Without Borders, known as MSF, an acronym for our French name, 
Medecins Sans Frontieres. MSF is an international independent medical 
humanitarian organization. My experience with MSF dates back to 1999 
and includes fieldwork in the Democratic Republic of Congo and China, 
as well as over a decade of research and analysis on access to 
medicines and innovation policy issues.
    We are most known for our emergency responses during armed conflict 
or following devastating natural disasters, or for our work against 
medical disasters like HIV/AIDS.
    Less visible is our engagement in providing care and treatment to 
impoverished people suffering from diseases so neglected that many in 
the world have never heard of them before--Chagas disease, kala azar, 
sleeping sickness and Buruli ulcer, to name a few. From our decades of 
experience running programs and conducting operational research, we 
know that there is limited access to the tools that exist to diagnose 
and treat these diseases. But we also know very well that these tools 
are terribly insufficient, and new products are needed.
    Globally, neglected diseases can best be thought of as the diseases 
of the bottom billion--those living in the most rural locations, with 
poor or no access to healthcare, and extraordinarily limited resources. 
People suffering from these diseases do not represent a profitable 
potential market and therefore current market incentives have proven 
insufficient to generate the development of better tools for 
prevention, diagnosis, treatment, and cure for these diseases. Between 
1975 and 2004, only 1.3 percent of all new drugs were specifically 
developed for tropical diseases and tuberculosis, even though these 
diseases account for 11.4 percent of the global disease burden.\1\ In 
addition, even when effective tools do exist, these populations can be 
difficult to reach due to geographic or social marginalization. 
Political will is often lacking, and healthcare infrastructure can be 
weak.
---------------------------------------------------------------------------
    \1\ Chirac, P., & Torreele, E. (2006). Global Framework on 
Essential Health R&D. The Lancet, 367(9522), 1560-1561.
---------------------------------------------------------------------------
    I would like to take the opportunity to share with you today the 
experiences of MSF in both treating and supporting innovation in 
treatments and diagnostics for neglected diseases.

                MSF EXPERIENCES WITH NEGLECTED DISEASES

    Many diseases, such as tuberculosis and tropical diseases, are 
neglected because they primarily affect people in poor countries. 
Across many of the diseases that disproportionately affect developing 
countries, children are particularly neglected: adapted pediatric 
medicine formulations are missing for diseases such as tuberculosis, 
Chagas disease and HIV/AIDS.
    The World Health Organization (WHO) has identified as neglected 
tropical diseases (NTDs) 14 major parasitic, bacterial and viral 
diseases that are the most common infections in the 2.7 billion people 
living on less than $2 a day. Those affected are often marginalized and 
forgotten by governments, left to suffer in silence. Other diseases 
like tuberculosis and pediatric HIV/AIDS are also neglected but are not 
within the WHO list of NTDs.
    MSF has for many years provided diagnosis and treatment for 
individuals afflicted with NTDs, primarily focusing on visceral 
leishmaniasis (VL, or kala azar), human African trypanosomiasis (HAT, 
or sleeping sickness), Chagas disease (American trypanosomiasis), and 
Buruli ulcer. Three of these NTDs--VL, HAT, and Chagas disease--are 
often fatal if left untreated and have the highest rates of death of 
all of the NTDs. MSF is one of the only actors in the world involved in 
the treatment of these diseases.
    Governments and donors have continued to neglect those who suffer 
from these diseases. These four diseases are largely left out of 
control and treatment programs by health actors and donors because they 
are considered too difficult and costly to treat; the available tools 
are limited; little investment has been made into research and 
development (R&D); and their disease burdens are poorly understood due 
to inadequate screening and surveillance systems. Nevertheless, the 
diseases are no less devastating for the individuals and countries 
affected. These barriers beg greater, not less, attention for effective 
responses to these diseases.
    In 2008, the U.S. Government established the Presidential 
Initiative on Neglected Tropical Diseases. However, the initiative only 
focused on 5 of the 14 identified by the WHO.\2\ It did not fund 
diagnosis and treatment of the deadliest neglected diseases, and did 
not provide support for the development of innovative products for 
these diseases. As part of the Global Health Initiative (GHI), the U.S. 
Government has now proposed a significant increase in funds for NTDs. 
MSF welcomes this increased attention to the NTDs. However, there 
remains an ongoing neglect of the most deadly and most forgotten 
diseases.
---------------------------------------------------------------------------
    \2\ The Presidential Initiative on Neglected Tropical Diseases 
disaggregates one WHO identified disease into three, therefore 
identifying the Presidential Initiative as responding to seven 
neglected diseases.
---------------------------------------------------------------------------
    It may be impossible in an illustrious committee room in the U.S. 
capital to paint a picture of the diseases that affect the poorest of 
the poor, who often live in the most remote areas of the world, but I 
will try.

Chagas Disease (American Trypanosomiasis)
    Chagas disease is an appropriate place to start if only because 
there are currently an estimated 300,000 people living with this 
disease in the United States today. There are 15 million people living 
with Chagas disease around the world. It is the largest parasitic 
killer in the Americas, responsible for about 14,000 deaths per year, 
mostly in South and Central America.
    This disease is caused by a parasite transmitted by a bug (the 
triatome). They call it the ``kissing bug'' because it bites gently, 
and victims often do not even know they have been bitten. It also can 
be transmitted from mother to child during pregnancy; and through blood 
transfusions and organ transplantation, and sometimes through oral 
transmission. If untreated, it infects the heart and digestive system 
of one-third of those carrying the parasite--with fatal effects in 30 
percent of patients over a period of time.
    Diagnosis currently requires confirmation through laboratory tests. 
In many cases, the endemic countries do not have the necessary 
facilities or staff available to carry out these tests.
    MSF has provided free diagnosis and treatment for Chagas disease 
since 1999 in countries including Honduras, Nicaragua, Guatemala, and 
Bolivia, which has the highest prevalence in the world. In Cochabamba, 
Bolivia, MSF runs free, urban and rural Chagas programs that are 
carried out in collaboration with the Bolivian Ministry of Health in an 
integrated way in five primary care centres, where children and adults 
up to the age of 50 are treated and diagnosed. Through 2009, MSF has 
screened over 60,000 people for Chagas disease and treated more than 
4,000. We are also currently exploring the possibility of opening a 
project here in the United States to improve detection and access to 
treatment for people living with Chagas disease.
    The tools we have at hand can be used for treatment, but are 
insufficient. Currently, there are only two medicines to combat Chagas 
disease: benznidazole and nifurtimox. Both were developed over 45 years 
ago through research that was not even specifically targeting Chagas 
disease. Presently, neither of these drugs is adapted for use in 
children, although a paediatric formulation of benznidazole is 
anticipated in the coming months. As the side effects of the treatment 
are more common in older patients, doctors have been reluctant to 
administer the medicine out of fear of the consequences. Further, there 
is no test for cure for Chagas disease.
    Millions suffering from Chagas disease, especially in rural areas, 
have neither the opportunity to find out that they are infected nor the 
possibility of being treated. New diagnostic tests, better medicines, a 
vaccine, and a test for cure are urgently needed to help prevent, 
diagnose and treat this disease.

Sleeping Sickness
    Sleeping sickness, otherwise known as human African trypanosomiasis 
(or HAT), is a fatal parasitic disease found in 36 countries in sub-
Saharan Africa, with an estimated 70,000 annual cases and 60 million at 
risk. During 2009 less than 10,000 cases were diagnosed and treated, 
but many more are affected--the true size of the problem remains 
unknown. Sleeping sickness occurs in the poorest rural areas of Africa, 
where difficulty of diagnosis, political instability, and lack of 
health surveillance make diagnosis and care difficult. Sleeping 
sickness rapidly deteriorates into coma and death--and is fatal in 100 
percent of patients within approximately 2 years if untreated.
    Up to 10 years ago, patients with advanced sleeping sickness would 
have received an arsenic-based treatment called melarsoprol. 
Melarsoprol is more than 50 years old and highly toxic, with rising 
rates of treatment failure. No new treatments had been developed for a 
half-century for sleeping sickness even though melarsoprol was killing 
the patient in about 5 to 10 percent of cases, and in some affected 
areas had only 50 percent effectiveness.
    Thanks to the efforts of many partners, including MSF, the WHO, 
Epicentre, the Drugs for Neglected Diseases initiative and the Swiss 
Tropical Institute (STI), there is now a new treatment for patients 
with advanced sleeping sickness. These partners have also supported the 
development of research capacity in countries where sleeping sickness 
is endemic. Using nifurtimox-eflornithine combination therapy (NECT) 
has proven to be safer and more effective compared to the existing 
standard of care. Eflornithine is given intravenously twice a day for 7 
days alongside orally administered nifurtimox. The treatment is life-
saving and prevents relapse back into the sickness. In May 2009, the 
WHO added NECT to the Essential Medicines List (EML) for the treatment 
of advanced sleeping sickness.
    Despite these improvements, the current treatment for sleeping 
sickness remains long and difficult--for both patients and health 
workers. Both diagnosis and staging--which requires painful lumbar 
punctures--demand significant technical capacities and are therefore 
difficult to implement in remote areas where the disease occurs. There 
is an immediate need to improve current diagnostic and treatment 
options, particularly for patients in the advanced stages of this 
disease.

Tuberculosis
    Tuberculosis (TB) is a major public health problem, with over 9.4 
million new cases and almost 1.8 million deaths in 2008 alone--or 
nearly 5,000 people every day. TB is a leading cause of mortality in 
children worldwide, with approximately 1 million cases and 400,000 
deaths each year in children under 15 years old as of 2006. The most 
commonly used TB diagnostic test is Sputum Smear Microscopy (SSM).\3\ 
It is relatively fast and easy to implement in resource-limited 
settings, but it has significant limitations: it detects less than half 
of all TB cases \4\ and performs even worse in children and people 
living with HIV who either have difficulties producing enough sputum, 
or don't have sufficient or any mycobacteria in their sputum to be 
detected under the microscope. It also completely misses the 
extrapulmonary form of TB.\5\ \6\
---------------------------------------------------------------------------
    \3\ Sputum smear microscopy is done by staining a sputum sample 
with an acid-fast stain and then examining the sample with a microscope 
for acid-fast bacilli.
    \4\ In countries characterized by high HIV prevalence, the 
challenge of providing timely TB diagnosis and treatment initiation is 
even greater. In a study recently conducted in Rwanda, where 62 percent 
of the recruited patients were TB/HIV co-infected, only 18 percent of 
TB confirmed cases were started on treatment within 1 month and only 56 
percent within 2 months.
    \5\ Perkins, MD, Roscigno, G, Zumla, A. (2005) Progress towards 
improved tuberculosis diagnostics for developing countries. The Lancet  
367(9514): 942-943.
    \6\ Shingadia, D, Novelli, V. (2003) Diagnosis and treatment of 
tuberculosis in children. Lancet Infect. Dis. 3(10): 624-632.
---------------------------------------------------------------------------
    A study analyzing the contribution that improving TB diagnostics 
could make to reducing the global burden of TB, shows that improving 
the performance, speed and accessibility of TB diagnostic tests are key 
factors.\7\ The study calculates that 392,000 deaths or 22 percent of 
annual deaths due to TB in the four highest-burden WHO regions, could 
theoretically be avoided by the introduction of a new TB point-of-care 
diagnostic.
---------------------------------------------------------------------------
    \7\ Keeler, E., et al., (2006) Reducing the global burden of 
tuberculosis: the contribution of improved diagnostics. Nature 444: 49-
57.
---------------------------------------------------------------------------
    We desperately need a new point-of-care diagnostic test able to 
diagnose active TB in adults and children who may also be co-infected 
with HIV; has high sensitivity and specificity; is simple to use and 
can be operated without the need for extensive infrastructure. Despite 
the valuable work supported by grant programs administered by entities 
such as the Foundation for Innovative New Diagnostics (FIND), there is 
widespread agreement that there is insufficient progress on the 
development of a new test that meets these needs.
MSF Experience in Innovation
    A decade ago, MSF created the Campaign for Access to Essential 
Medicines because of our concern about barriers for access to medicines 
in low- and middle-income countries. People in developing countries are 
dying because medicines do not exist due to inadequate incentives for their 
development; or because they are unavailable due, in part, to high 
costs.
    Our work on NTDs convinced us that we wanted not only to advocate 
for new tools, but also to engage actively in the development of these 
tools. Therefore, MSF became a founding member of the Drugs for 
Neglected Diseases initiative, or DNDi, a product development 
partnership (PDP). We continue to contribute funding, making MSF the 
third largest philanthropic (under of neglected disease research.\8\ 
From our experience as a founding member of DNDi, we know that a 
critical role is played by ``push'' funding--that is, grants invested 
into promising candidates for future drugs. While push funding and PDPs 
play an important role, our experience also tells us that incentives 
are needed throughout the innovation process to ensure that the right 
products reach the end of the pipeline. For this reason, we also need 
``pull funding''--that is, incentives at the end of the product 
development process, such as the promise of a profitable market or 
other reward. While donors and governments have invested increased 
amounts in push funding, we are just beginning to see serious efforts 
to explore how best to put in place pull funding.
---------------------------------------------------------------------------
    \8\ Moran, M., Guzman, J., Henderson, K., Ropars, A., McDonald, A., 
McSherry, L., Wu, L., Omune, B., Illmer, A., Sturm, T., & Zmudzki, F. 
(2009). Neglected Disease Research and Development: New Times, New 
Trends. Sydney, Australia: The George Institute for International 
Health, p. 62.
---------------------------------------------------------------------------
    PRIORITIZATION OF ACCESS CONSIDERATIONS: THE IMPORTANCE OF ``DE-
                               LINKAGE''

    The current system for drug, diagnostic and vaccine development 
creates both innovation and access barriers. Driven by commercial 
rewards, it is a system that leaves many pressing health needs 
unanswered--needs that we identify in our medical programs every day. 
New medicines for sleeping sickness were not developed for 50 years 
despite pressing needs. The diagnosis of sleeping sickness is 
complicated, and often requires a blood sample, lymph node aspiration 
and a painful lumbar puncture. There is no test to determine whether 
patients have been cured of Chagas disease after a course of treatment. 
A diagnostic tool for tuberculosis does not exist in a form appropriate 
for resource-poor settings. These populations are simply too poor to 
provide adequate commercial incentives for R&D in a system that relies 
almost entirely on the ability to sell products at high prices to 
incentivize drug and diagnostic development.
    But what if we could separate the market for medicines production 
from the market for R&D? What if we could encourage robust competition 
in both?
    MSF believes that de-linking the cost of R&D from the price of 
health products needs to be the key principle used to evaluate and 
develop mechanisms to stimulate R&D and ensure access. This principle 
has gained increasing acceptance worldwide. The concept of de-linkage 
fully accepts that R&D costs money, but seeks alternative ways to fund 
it. Rather than relying on high prices charged after the innovation has 
been developed, de-linkage would seek to stimulate innovation from many 
sources and consider access issues in advance. This approach would 
broaden incentives for innovation beyond just the profitable diseases, 
and remove the access barriers created by high prices.
    The concept of de-linkage has been included in the Global Strategy 
and Plan of Action on Public Health, Innovation and Intellectual 
Property (GSPoA), which was agreed upon in 2008 by all WHO Member 
States, including the United States.\9\ In conjunction with this plan, 
several governments have proposed the creation of new incentive 
mechanisms, including prizes, based on the principle of de-linkage. 
Just 2 months ago, the Council of the European Union decided to explore 
``models that dissociate the cost of Research and Development and the 
prices of medicines,'' as a part of its global health efforts.\10\
---------------------------------------------------------------------------
    \9\ The Global Strategy and Plan of Action Section 5.3.a states:

    ``explore and, where appropriate, promote a range of incentive 
schemes for research and development including addressing where 
appropriate, the de-linkage of the costs of research and development 
and the price of health products, for example through the award of 
prizes, with the objective of addressing diseases which 
disproportionately affect developing countries.'' World Health 
Assembly. (2008). Global Strategy and Plan of Action on public health, 
innovation and intellectual property. Resolution 61.21. Geneva. 
Available: http://www.who.int/gb/ebwha/pdf_files/A61/A61_R21-en.pdf.
    \10\ Council of the European Union. (2010) ``Council conclusions on 
the EU role in Global Health.'' 2011th Foreign Affairs Council meeting. 
Brussels. 10 May 2010. Section 18.c. Available: http://
www.consilium.europa.eu/uedocs/cms_Data/docs/pressdata/EN/foraff/
114352.pdf.
---------------------------------------------------------------------------
    Why the broad interest in ``de-linkage''? De-linkage is important 
because the price of the final product is critical for affordability 
and access, and because R&D should be driven by health priorities, not 
the size of the market. Innovation by itself is of little value if the 
tools developed are unavailable or unaffordable to the people who need 
them. By paving for R&D through financing rather than through product 
prices, and by addressing the price and availability of the product at 
the outset, de-linkage removes the need to incentivize R&D through high 
prices. De-linkage also stimulates R&D where there is no profitable 
market--that is, for neglected, rare, orphan diseases, or diseases like 
pediatric HIV/AIDS which has been all but eliminated in rich countries 
even as a rich country market continues to exist for adult HIV/AIDS 
medicines.
    De-linkage is not just about breaking the link to high prices, but 
is also about pro-actively designing into any new incentive mechanisms 
ways to ensure that the affordability and availability of any new 
health tool are incorporated from the outset of the R&D process. A 
range of different funding mechanisms that allow de-linkage are needed, 
either to ``push'' R&D via up front funding (e.g., through PDPs) or to 
``pull'' R&D via incentives that focus investment efforts on products 
needed in developing countries (such as prize funds).
    Once the market for R&D is de-linked'' from high medicines prices, 
we can encourage robust competition among producers of the end product. 
Our experience shows that competition is the most effective way to 
achieve reliable price reductions and sustainable, affordable prices. 
Intellectual property can and should be managed in a way that ensures 
that a new health tool can be manufactured by other producers, 
fostering competition and access. A recent example is the patent-free 
development of the anti-malarial fixed-dose combination of artesunate 
and amodiaquine by DNDi, in collaboration with the pharmaceutical 
company Sanofi-Aventis. (In cases such as vaccine development where 
competition may not be technically feasible in the immediate term, even 
when favorable licensing terms exist, a pathway to facilitate access is 
needed, including technology transfer.)

                    BREAKING THE INNOVATION BARRIERS

    Prizes are one attractive option for de-linking the markets for R&D 
and product manufacturing. Prizes can act as powerful incentives for 
innovation, but need to be designed carefully in order to maximize the 
sharing of knowledge, access to end products, and overall return on the 
public's investment. Prize designs can vary, and they can also be given 
for different stages of the R&D process, such as identifying 
biomarkers, proof of concept, product synthesis, or developing a 
finished product all the way through the registration process. The key 
potential benefits of a well-
designed prize include some of the following \11\:
---------------------------------------------------------------------------
    \11\ See, e.g., Love, James and Hubbard, Tim (2009). ``Prizes for 
Innovation of New Medicines and Vaccines,'' Annals of Health Law, 18 
(2): 155-186.

    1. It would allow R&D efforts to be driven by health needs.
    2. It would establish a bold and important goal without having 
donors or governments pick winners by choosing in advance the path or 
team that is most likely to succeed in reaching it.
    3. Payment would only be made when results are achieved. The prize 
is only paid if the challenge has been met, i.e. if donors can see a 
direct connection between their funding and the outcomes.
    4. With the right backing, a prize can create a ``lighthouse'' 
effect by highlighting a problem to a whole new range of potential 
innovators, who may have previously been unaware of the problem. This 
increases the number and diversity of potential ``solvers'' for a 
problem, which could include, for example, both commercial enterprises 
and academics. An even wider range of participants could be sought 
through the award of intermediate prizes for solutions to specific 
technical challenges.
    5. A prize could include incentives for collaboration and 
knowledge-sharing.
    6. By including affordability criteria, the prize could promote 
both innovation and access.

    Two specific examples of urgent needs that we've identified in our 
programs--and for which there will be little engagement from the major 
R&D players without novel innovation mechanisms--are related to TB and 
Chagas disease.
    Millions would benefit from the creation of a point-of-care (POC) 
test that would allow the diagnosis of TB at local health centers in 
resource-poor contexts. The dearth of R&D in TB diagnostics is 
demonstrated by the chronic lack of investment in this area, 
particularly from the private sector. Only U.S. dollars--41.9 million 
was directed towards TB diagnostics R&D--a mere 9 percent of total 
resources spent on TB product development, which is already an under-
funded field. Of this amount, only U.S. dollars--2.5 million came from 
the private sector. A TB diagnostic test designed for use in resource 
poor areas, which necessarily has to be low cost, requires a different 
form of incentive that would allow for the cost of the final product to 
be de-linked from the cost of R&D. A prize competition would create the 
incentives for R&D in this neglected area.
    As noted above, a prize fund would allow for many different 
approaches to be pursued without deciding at an early stage which is 
the most promising. This is particularly important in the field of TB 
POC diagnostic development since there are several approaches that 
could potentially lead to the delivery of the right test, but it is not 
clear which angle will be the most successful. Current R&D in different 
areas of the POC diagnostic market, such as bioterrorism, pandemic 
influenza, and HIV viral load testing, holds the potential for 
breakthroughs in the area of TB diagnosis. The governments of 
Bangladesh, Barbados, Bolivia and Suriname have proposed a prize fund 
of $100 million or more for a TB POC diagnostic.\12\ By providing a 
sizeable incentive, the prize would attract many developers to the 
neglected area of TB.
---------------------------------------------------------------------------
    \12\ Governments of Bangladesh, Barbados, Bolivia and Suriname. 
(2009) Prize Fund for Development of Low-Cost Rapid Diagnostic Test for 
Tuberculosis. 15 April. Contributions from Member States. WHO 
Secretariat on Public Health, Innovation and Intellectual Property. 
Available: http://www.who.int/phi/
Bangladesh_Barbados_Bolivia_Suriname_TBPrize.pdf.
---------------------------------------------------------------------------
    Prizes are not a new mechanism, but have successfully been used in 
the past to induce innovation. For example, recently the Global 
Alliance for TB Drug Development (a PDP) and the Rockefeller Foundation 
awarded two prizes for more efficient ways to synthesize a new 
tuberculosis drug candidate, PA-824. Prizes are also receiving renewed 
attention in policy circles because of their potential to help address 
our most pressing public problems. Just this past spring, the White 
House issued guidance on the Open Government Directive, supporting the 
use of prizes to encourage innovation in a range of areas, including 
climate change technology and promoting open government.\13\
---------------------------------------------------------------------------
    \13\ Executive Office of the President: Office of Management and 
Budget. (2010) ``Memorandum for the Heads of Executive Departments and 
Agencies (M-10-11).'' Washington, DC. 8 March. Available: http://
www.whitehouse.gov/omb/assets/memoranda_2010/m10-11.pdf.
---------------------------------------------------------------------------
    While individual initiatives that can be established quickly, such 
as a TB POC diagnostic prize fund, are important, others are exploring 
how prizes could be used as part of longer-term systemic changes that 
are needed to provide sustainable financing for health needs-driven R&D 
that ensures equitable access.
    Similarly, we need innovative tools for the diagnosis, treatment, 
and test of cure for Chagas disease. The governments of Bangladesh, 
Barbados, Bolivia and Suriname have proposed creating a $250 million 
prize fund to reward the development of new products that would 
decrease the burden of disease from Chagas.\14\
---------------------------------------------------------------------------
    \14\ Governments of Bangladesh, Barbados, Bolivia and Suriname. 
(2009) Chagas Disease Prize Fund for the Development of New Treatments, 
Diagnostics and Vaccines. 15 April. Contributions from Member States. 
WHO Secretariat on Public Health, Innovation and Intellectual Property. 
Available: http://www.who.int/phi/
Bangladesh_Barbados_BoliviaSuriname_Chagas
prize.pdf.
---------------------------------------------------------------------------
    Prizes are also flexible tools. There is not just one model, and 
they can be designed to fit the medical, scientific, and technical 
problems that need to be addressed and the specific access issues for a 
disease area. In some areas it may be more appropriate to have a prize 
that rewards the development of the final product. In others, it might 
be more effective to support a prize that can be focused on a critical 
milestone that could overcome a key barrier to further development. In 
all cases, however, it is critical that methods to ensure affordable 
access must be part of the prize design at the start.
    DNDi has been considering milestone prizes for Chagas drug 
development. Substantial rewards for attaining specified milestones 
along the path to a new drug or other health technology could be a 
useful supplement to grants for diseases for which market incentives 
are deficient and where patents are not an effective incentive. 
Milestone prizes promise earlier pay-outs and are likely to attract new 
actors such as biotechnology firms, which cannot make major investments 
in pursuit of rewards that may be many years away.
    Several discussions to explore de-linkage mechanisms for the 
technological needs of Chagas are also ongoing at the regional level as 
part of the Pan American Health Organization's (PAHO) regional 
implementation of the GSPoA. These discussions provide a framework for 
agreement on new incentive mechanisms, including appropriate prize 
designs to stimulate innovation for Chagas disease.

                               CONCLUSION

    MSF welcomes the growing attention to patients who suffer from 
neglected diseases around the world. We ask the U.S. Government to 
include the most deadly tropical diseases (Chagas disease, sleeping 
sickness, kala azar, and Buruli ulcer) within the scope of its new 
Global Health Initiative, and to provide support for improved access to 
existing health tools, as well as for the development of new and 
improved ones. We also urge the U.S. Government to craft its policies 
and mobilize its financial resources to support ambitious, visionary 
approaches to generating medical innovation that can improve the lives 
of the world's poorest children and families. In particular, the United 
States should support relevant discussions at the WHO and PAHO, and the 
efforts of the Consultative Expert Working Group that will be formed in 
the coming months to analyze new innovation mechanisms in depth.\15\
---------------------------------------------------------------------------
    \15\ See the mandate given to WHO by the 2010 World Health 
Assembly. (World Health Assembly (2010). ``Establishment of a 
consultative expert working group on research and development: 
financing and coordination.'' Resolution 63.28. Geneva. Available: 
http://apps.whoint/gb/ebwha/pdf_files/WHA63/A63_R28-en.pdf.
---------------------------------------------------------------------------
    I have outlined today just two promising possibilities--the 
potential of a prize fund for TB diagnostics and for Chagas disease--
but there are many others. We need strong political commitment and 
financial support from governments and other donors if we are to make 
new incentive mechanisms work. There is increasingly widespread 
recognition that the existing R&D system is failing--failing patients 
with neglected tropical diseases, with orphan diseases, and children, 
among others. Now is the time to begin testing new approaches to 
generate the innovation that we need to meet global public health 
needs.
    Thank you very much for this opportunity to share our experience 
with you.

    Senator Brown. Thank you, Ms. Moon.
    Dr. Frattarelli.

   STATEMENT OF DANIEL A.C. FRATTARELLI, M.D., FAAP, CHAIR, 
 COMMITTEE ON DRUGS, AMERICAN ACADEMY OF PEDIATRICS, DEARBORN, 
                               MI

    Dr. Frattarelli. OK. All right.
    Senator Brown, Senator Enzi, Senator Sanders, Senator 
Casey, on behalf of the AAP, I'd like to thank the committee 
for holding this important hearing on treatments for children 
with rare and neglected diseases.
    I want to let you guys know this testimony is also 
supported by the American Pediatric Association, the American 
Pediatric Society, the Association of Medical School Pediatric 
Department Chairs, and the Society for Pediatric Research.
    Pediatricians often say that children are therapeutic 
orphans because they lack the breadth of available therapies 
that are offered for adults. That's not just for rare diseases, 
that's across the board. Lower financial incentives and greater 
clinical-trial obstacles have resulted in fewer drugs being 
developed specifically for children.
    There are significant barriers to the development of 
therapeutics for children, in general. These obstacles are 
magnified for children with rare diseases.
    As we've already heard, most of the rare diseases are 
pediatric. And because most of these are genetic, they're 
present from birth into adulthood. Pediatricians play an 
important role in the care of children with rare diseases, but, 
as we've already heard, really, so eloquently from Mr. Silver 
and Mr. Crowley, a lot of the time, we're left without proven 
therapies to treat them, or with existing therapies that just 
aren't sufficient for taking care of children.
    The American Academy of Pediatrics have been working for 
decades to improve medicines for children by ensuring that the 
drugs used in children are studied in children. As we've heard 
so many times here, children are not just little adults. I'm so 
glad to hear that, so many ways, here, because that used to not 
be the case. Many people used to think that, in fact, they 
were; and that distinction hadn't been made. Children need 
drugs that are safe, effective, and developed just for them, 
and drugs which meet the same standards as we have for adults.
    Because rare diseases are often so serious and so life-
threatening, physicians must think differently about how they 
balance therapeutic risks and benefits in treating them. When 
therapeutic gaps exist for children, drugs are frequently used 
off-label without the benefit of the same drug labeling 
information that we've come to expect for adults. The outcomes 
of these off-label treatments, however, all too often stay with 
the physician and fail to benefit other patients. We need a 
greater capacity to capture and interpret data from what are 
essentially a bunch of small studies which are being conducted 
independently every time we treat one of these children off-
label.
    One possible mechanism for this would be the creation of a 
central repository for data generated on these individual 
treatment basis, to establish the efficacy and the safety of 
medications for rare diseases.
    Now, two laws--the Best Pharmaceutical for Children's Act, 
BPCA, and the Pediatric Research Equity Act, PREA--have made 
historic progress in improving the information available to 
pediatricians and families for drugs used in children. 
Together, these laws have resulted in 385 drug labels revised 
with new safety, new efficacy, and new dosage information. And 
we can now say, with confidence, that BPCA and PREA have 
changed pediatric practice for the better.
    Senator Chris Dodd--I was hoping he was going to be here to 
hear this--but, really, in particular, deserves great credit 
for his passionate leadership, over the course of his career, 
to improve the health of children. BPCA and a more recent 
initiative, the Pediatric Medical Devices Safety and 
Improvement Act, from 2007, will stand as long-lasting legacies 
to his dedication to child health and well-being.
    BPCA and PREA have been important for children as a whole, 
and also for children with rare diseases. The laws greatly 
complement the Orphan Drug Act, which has done a remarkable job 
in stimulating new therapies for rare diseases. And of those 
385 drug labels resulting from BPC and PREA, 56 have also 
received an orphan designation.
    BPCA, PREA, and the pediatric devices law must be 
authorized in 2012, and the AAP looks forward to working with 
this committee on reauthorizing and strengthening these 
important programs.
    Studying drugs in children is difficult and requires 
specialized skills. However, we still lack a number of 
qualified experts which are needed to actually do the work. 
We're training far too few new pediatric clinical 
pharmacologists. And if more is not done to reverse this trend, 
children will be left behind.
    Finances, as we've already heard, can also be a barrier to 
effective therapies. New and novel drugs for children with rare 
diseases, which are usually expensive or often deemed 
experimental by insurance programs and are not reimbursed, and 
paying out-of-pocket for these drugs is simply not possible for 
many families. The promise of healthcare reform for children 
with rare diseases can only be realized if life-saving and 
life-improving therapies are paid for by insurance programs.
    Along with drugs, medical and surgical devices are also 
important components in the treatment of many pediatric rare 
diseases. The development of pediatric devices shares the same 
obstacles, or at least similar ones, to pediatric drugs. And 
the Pediatric Medical Device Safety and Improvement Act was a 
first legislative step to ensuring that children will have 
access to devices that are safe, that are effective, and that 
are made with their unique characteristics in mind. Children 
deserve a continued sense of urgency around medical devices, 
though, and we look forward to working with the FDA to fully 
implement this law.
    Finally, regarding the neglected diseases, it's 
unacceptable for any of us, from regulatory agencies to 
manufacturers, for the medical community to neglect to treat 
diseases for which effective therapies are within reach. And 
the AAP encourages ongoing work focused on the identification, 
prioritization of clinical conditions which affect a sizable 
number of children, but which have, for whatever reason, been 
neglected.
    Thank you for allowing the Academy of Pediatrics to share 
its views on this important issue.
    [The prepared statement of Dr. Frattarelli follows:]

       Prepared Statement of Daniel A.C. Frattarelli, M.D., FAAP

    Mr. Chairman, members of the committee, I am Daniel Frattarelli, 
M.D., FAAP, a practicing pediatrician who has taken care of infants, 
children and adolescents for 13 years. I am chair of Pediatrics at 
Oakwood Hospital and Medical Center in Dearborn, MI and chair of the 
American Academy of Pediatrics (AAP) Committee on Drugs. On behalf of 
the AAP, I would like to thank the committee for holding this important 
hearing on new treatments and cures for children with rare and 
neglected diseases.
    Pediatricians often say that children are therapeutic orphans 
because they lack the breadth of therapies available to adults. Lower 
financial incentives and greater clinical trial obstacles have resulted 
in fewer drugs developed and studied specifically for children. When a 
disease population is small, there is a lower likelihood that 
pharmaceutical companies can recoup the costs of developing new drugs. 
It is also difficult to recruit sufficient numbers of participants for 
a robust clinical trial. Both children and rare disease populations 
suffer from these similar small market problems. There are significant 
therapeutic obstacles for children in general, and these obstacles are 
greatly magnified for children with rare diseases.
    Most of the approximately 7,000 rare diseases are pediatric 
diseases. Because most rare diseases are genetic, they are present from 
birth, through childhood, and into adulthood. Pediatricians play an 
important role in the care of children with rare diseases from 
diagnosis to treatment and care. For many of these patients, however, 
pediatricians are left without proven therapies to treat them or with 
existing therapies that are not sufficient.
    The American Academy of Pediatrics has been working for decades to 
improve therapeutics for children by ensuring that drugs used in 
children are studied in children. In 1977, AAP said for the first time 
that not only is it not unethical to study drugs in children, but that 
it is unethical not to. Children are not little adults. They need drugs 
that are developed just for them and they deserve the same level of 
safety and effectiveness in drugs that is assured for adults.
    Because rare diseases are so often serious and life threatening, 
physicians must think differently about how they balance therapeutic 
risks and benefits when treating them. When therapeutic gaps exist for 
children--and in particular for children with rare diseases--drugs must 
frequently be used ``off-label,'' or without the benefit of the same 
drug labeling information that we have come to expect for adults.
    As doctors we know that better medical evidence is based on trials 
with a larger ``N,'' or a larger number of patients. But when this 
evidence is not available for children, the standard of care is off-
label treatment. We call this a trial with an ``N of one.'' Physicians 
must monitor their young patients and try additional therapies, 
combinations, or dosages depending on the results. The outcomes of 
these ``N of one'' trials too often stay with the treating physicians. 
For other children to benefit from these studies, new tools are needed 
to collect and interpret the clinical results of off-label treatments.
    One possible mechanism for the collection of these data is the 
creation of a central repository for data related to the safety and 
efficacy of treatments in rare conditions. Consensus on the specifics 
of the data collected can be reached by the combined efforts of 
physicians trained in pediatric research and those physicians in the 
trenches who care for these children day in and day out. The most 
apparent benefit from this approach is the ability to capture and 
meaningfully interpret the data from what are essentially a bunch of 
small studies being independently conducted across the country. But 
another significant benefit to this approach would be a standardization 
or leveling of the risks to these children, as by virtue of their being 
enrolled in a study there is a greater, more formal, more clearly 
defined awareness of and attention to possible risks, which would come 
to light more fully through the consensus process than is possible for 
an individual physician.
    Two laws, the Best Pharmaceuticals for Children Act (BPCA) and the 
Pediatric Research Equity Act (PREA), have made historic progress in 
improving the information available to pediatricians and families on 
drugs used in children. PREA provides FDA the authority to require 
pediatric studies of drugs when their use for children would be the 
same as in adults. BPCA provides a voluntary incentive to drug 
manufacturers of an additional 6 months of marketing exclusivity for 
conducting pediatric studies of drugs that the FDA determines may be 
useful to children.
    Together these laws have resulted in 385 drug labels revised with 
new safety, effectiveness, and dosage information. We can now say with 
confidence that BPCA and PREA have changed pediatric practice for the 
better. They have also changed the way drugs are developed by Industry 
and regulated by FDA. Pharmaceutical companies have invested in greater 
internal pediatric infrastructure, so that pediatrics can be considered 
at each stage of drug development. At FDA, with the help of the new 
BPCA-created Pediatric Review Committee (PeRC), pediatrics has been 
integrated across the review divisions in a consistent and productive 
way for the benefit of children. The pediatric efforts at FDA would not 
have been possible without the leadership of Dr. Dianne Murphy and the 
Office of Pediatric Therapeutics (OPT).
    Senator Chris Dodd in particular deserves great credit for his 
passionate leadership over the course of his career to improve the 
health of children. BPCA and a more recent initiative, the Pediatric 
Medical Devices Safety and Improvement Act of 2007, will stand as 
lasting legacies to his dedication to child health and well-being.
    BPCA and PREA have been important both for children as a whole and 
for children with rare diseases. The laws greatly complement the Orphan 
Drug Act, which has done a remarkable job stimulating the development 
of new therapies for rare diseases. Of the 385 drug labels resulting 
from BPCA and PREA, 56 have been for drugs that have also received an 
``orphan'' designation.
    BPCA, PREA, and the pediatric devices law must be reauthorized in 
2012 along with the Prescription Drug User Fee Act, and the AAP looks 
forward to working with this committee on reauthorizing and 
strengthening these important programs for children.
    As effective as these laws have been, there is still a great need 
for more progress. The majority of drugs still lack pediatric 
information and many rare and neglected pediatric diseases lack 
effective therapies. New creativity in overcoming the obstacles to 
small market therapies, coupled with renewed resources for research and 
incentives for development, will be needed to continue making progress.
    Advances in basic research must be a fundamental part of any 
strategy to develop new cures for children with rare diseases. We must 
work to find new drug targets for rare diseases and develop appropriate 
endpoints to evaluate potential therapies. The National Institutes of 
Health (NIH) and the National Institute of Child Health and Human 
Development (NICHD) are key partners in this effort and we must 
continue to give them the resources necessary to accomplish this 
essential work.
    Studying drugs in children is difficult and requires specialized 
skills. Each stage of the pediatric drug development process comes with 
unique challenges. Early phase clinical trials are particularly 
difficult in pediatric populations. Recruitment is frequently a problem 
throughout the process. Trials must be designed with the 
vulnerabilities of children in mind, and these challenges are even 
greater for the smallest of children, neonates. FDA approval of drugs 
is also challenging, often complicated by vastly different indications 
for pediatric and adult use.
    All of these difficulties necessitate trained pediatric 
investigators, and we still lack the number of qualified experts to 
actually do the work. Pediatric pharmacology studies require a very 
different level of skill to appropriately conduct and analyze, skills 
which are not often needed in adult studies. We are training far too 
few new pediatric clinical pharmacologists and if more is not done to 
reverse this trend, children will be left behind. BPCA made initial 
progress in this effort by expanding access to loan repayment for 
physicians who study pediatric pharmacology, but this alone will not be 
sufficient.
    Barriers to access unfortunately do not stop at the development of 
an effective therapy. New and novel drugs for children with rare 
diseases are often expensive. Comprehensive insurance coverage is 
essential for these children and their families. The Affordable Care 
Act has taken great steps forward in ensuring that all children have 
access to health insurance regardless of family income, pre-existing 
conditions, or exceeded lifetime and annual benefit caps. Therapies for 
rare diseases, however, are often deemed experimental by insurance 
programs and not reimbursed. Paying out-of-pocket for these drugs is 
simply not possible for many families. The promise of health care 
reform for children with rare diseases can only be realized if life-
saving and life-improving therapies are paid for by insurance programs.
    Most of our discussion so far has focused on rare diseases, but we 
also would like to say something about neglected diseases as well. 
While development of safe and effective treatments for rare diseases is 
constrained by their low prevalence, the same cannot be said for those 
conditions which have been neglected. It is unacceptable for any of us, 
from regulatory agencies to manufacturers to the medical community, to 
neglect to treat diseases for which effective therapies are within 
reach. The AAP encourages ongoing work focused on the identification 
and prioritization of clinical conditions which affect a sizable number 
of children but which have, for whatever reason, been neglected.
    Along with drugs, medical and surgical devices are integral 
components of the treatment of many rare diseases. The development of 
pediatric devices shares obstacles similar to pediatric drugs. The 
Pediatric Medical Device Safety and Improvement Act, passed in 2007, 
was a first legislative step to ensuring that children have access to 
devices that are safe, effective, and made with their unique 
characteristics in mind, which include smaller sizes, growing bodies, 
and different biology. It is important that FDA proceed quickly to 
realize the promise of this legislation for children and take bold 
steps to improve representation of pediatric expertise with the Center 
for Devices and Radiological Health (CDRH). We are encouraged by the 
approach new leaders in CDRH and FDA have taken but children deserve a 
continued sense of urgency.
    When fully implemented, the pediatric device law will increase the 
tracking of pediatric device approvals and the postmarket surveillance 
of these devices. It will also help incentivize pediatric device 
development. The law modified the humanitarian use device (HUD) program 
to remove the profit cap for pediatric HUDs. This year, the first 
pediatric HUD was approved under this revised program. FDA's Office of 
Orphan Products Development is successfully administering a new grant 
program authorized by the law to fund consortia to encourage the 
development of new pediatric devices. We look forward to working with 
FDA to continue the implementation of this law, including provisions 
that require device applicants to submit ``readily available'' 
information on potentially affected pediatric populations.
    Thank you for allowing the American Academy of Pediatrics to share 
its views on therapies for children with rare diseases and for raising 
awareness of this important issue. We look forward to working with the 
committee to improve the health and well-being of all children. I am 
happy to answer any questions from the committee.

    Senator Brown. Thank you very much, Dr. Frattarelli.
    I'll start with Mr. Silver. Tell us about the difficulties, 
if any, that you were faced with, with insurance, in paying for 
your son's illness. And not just for you, who appear to have a 
good-paying, decent job, probably with good insurance. Talk to 
me about others that you know from your dealings with EB and 
what you've seen with insurance.
    Mr. Silver. Absolutely. Starting from my own perspective, 
when our son was born, we were told his disease was anywhere 
from mild to fatal. And they took him away within 12 hours of 
his birth. And the first thing I did, actually, was e-mail 
someone who deals with our health insurance, and had him listed 
as soon as possible. The reason I bring that up is one of the 
people, who's in the audience today, who shared this story with 
me just before we started. This is Kati Ward. She doesn't have 
her bandages covered, because it was deemed a preexisting 
condition.
    Now, to give you a sense of what bandage costs for EB are 
like, they can be as high as $14,000 a month--$14,000. Our son, 
who has a severe form of EB, but a more moderate case, his 
bandages run about $6,000 a month. You add, on top of that, 
medical bills for doctors' visits, so forth, you easily get 
into 2-, 250, as a category.
    Another person in this room is limited to the number of 
types of bandages she can have per month. So, what does that 
mean? That means there are certain bandages which are 
relatively high-tech that enable you to manage the disease 
better, and you're told, ``Well, we will only give you five.'' 
And there's no particular reason why five is selected.
    This is a long way of saying that it has been a difficult 
battle, a very difficult battle. And for someone with fortune 
to have resources, we went to battle with our insurance 
company, and ultimately they honored that contract, mostly 
because we had the contract, and we were fortunate to do so.
    For those who are struggling, day-to-day, who may have 
insurance, the hoops you have to jump through are unbelievable. 
There are a number of other examples we can point to, actually 
just in this audience, again. Michelle, who's here, who came 
down, she is also limited to the number of bandages she gets.
    This has to be an easier process to deal with. What you 
deal with when you have a child who has a disorder like this 
is, in so many ways, crushing, and changes your life. To add on 
top of that having to fight, tooth and nail, just to get your 
son or daughter the coverage that is, in many ways and certain 
cases, actually already under contract, or that you have to 
fight so much just to help get them through the day, needs to 
change.
    Senator Brown. Thank you.
    Dr. Frattarelli, what is the single most significant 
barrier to R&D for rare and neglected diseases?
    Dr. Frattarelli. I think one of the biggest ones is that 
there's often not enough children out there that you can 
actually get them together, get them enrolled in a clinical 
study, and have this conducted so that you can meet the same 
criteria that we would use, let's say, if we were doing a new 
antibiotic or something that affects a broader part of the 
population.
    The other thing that we really don't have right now is a 
well-enough-developed pediatric research infrastructure. I was 
mentioning, before, that there's just not enough well-trained 
general pediatric clinical pharmacologists out there to 
actually design and conduct these studies properly.
    I think those are probably the two biggest obstacles we're 
seeing right now.
    Senator Brown. OK.
    Ms. Dorman, how do we attract more young scientists to this 
field? If we're going to do what pretty much everybody has said 
here, the work Mr. Crowley's doing, the work that Ms. Moon and 
Mr. Silver advocate, do you have any special thoughts on how we 
attract young people into this research?
    Ms. Dorman. You know, the NIH has been doing some really 
important work--the Office of Rare Disease Research. They've 
been going into junior high schools and talking about rare 
diseases, and getting them really interested in the science of 
rare diseases.
    I also think that the medical colleges and schools don't 
really focus on rare diseases. It's basically just an 
afterthought. And I think there needs to be an increased 
interest in the study of rare diseases.
    Also in the academic community--a lot of times they're not 
willing to do any of these type of studies because, in many 
cases, it's publish or die, and to do very limited studies on 
rare diseases, it doesn't work for them. So, that's really a 
big problem.
    I think greater outreach into the medical community and 
medical schools are going to be really important.
    But, there is an increased interest. We're working with 
Duke University. We're working with Notre Dame. We're also 
working with the Manton Center, in Boston. So, there's an 
increased interest into the study of rare diseases because I 
think many of them are beginning to realize that understanding 
the pathogenesis of rare diseases is going to advance society's 
understanding of diseases that affect far wider populations. 
So, we're very excited about that, that there is an increased 
focus.
    Senator Brown. Senator Sanders.
    Senator Sanders. Thank you, Mr. Chairman, for holding this 
very important hearing today. And thank you, Senator Brown, for 
the leadership role you've played on this critical issue. I 
appreciate the committee's holding this hearing today.
    It seems to me that the problem that we're having--and I 
want to hear responses from the panelists, and perhaps starting 
off with Ms. Moon--is the following, Mr. Chairman.
    If you have a disease, and if you have the money--no matter 
how serious or nonserious that medical problem may be--but, if 
you have the money to pay for the medicine or the drug to treat 
that problem, the drug companies will provide that medicine to 
you. On the other hand, if you or your child is one of a 
relatively small number of people who have a disease which 
could be fatal or cause a whole lot of suffering, but there's 
not a whole lot of money to be made from that, the drug 
companies are not going to gravitate toward that issue.
    The function of a drug company, as I understand it, is to 
make as much money as possible. That's what the market is 
about. So, if you have an illness that one can make money from, 
you will see that advertisement on television, telling you to 
run out to your pharmacy to buy a drug for a disease you may 
not even know that you had. But, you're certainly going to run 
out and get that drug. On the other hand, if, as Ms. Moon 
indicated, you're living on a dollar a day in Africa and your 
child may be dying of a disease that, if diagnosed, might be 
cured, no one's going to get that medicine to you. Because, how 
do you make money from people who are living on a dollar a day? 
That's not a very good group of folks from which you can make 
money.
    So, I think we have a dual problem. No. 1, diseases in 
which there are relatively few people who are suffering from 
it, and, second of all, diseases where millions may be 
suffering, but they don't have the money to pay for the 
treatment or the diagnosis.
    Ms. Moon, I agree with you. I think we've got to move to a 
new concept, in terms of funding, research, and development, 
and it shouldn't be simply a market mechanism.
    Can you talk a little bit about the concept of the prize, 
and how that differs from where we are right now?
    Ms. Moon. Thank you very much for the question, Senator 
Sanders.
    The concept of the prize, and the reason why we think it's 
such a promising mechanism, is that we would still reward 
innovation. We would still pay for R&D, but we would do it in a 
way that would not rely on high prices. As we just heard from 
Mr. Silver, and as I think many people in the room have 
experienced personally, the high prices of medicines is 
something that people all over the world struggle with--in 
developing countries, in particular, but, of course, also here 
in the United States, with escalating healthcare costs.
    So, the idea of the prize is that we could specify, based 
on public health concerns, What is the goal that we want? What 
is the new product, medicine, diagnostic tool, vaccine, 
whatever it may be that we want? And set out a number of 
criteria for what types of characteristics of that--What would 
be the characteristics of that product? And then put that out 
there and basically allow any innovator in the world who might 
be able to tackle this problem and come up with a solution, to 
propose a solution.
    Once a product had been developed and the solution was 
brought to the table, a certain amount of money from the prize 
fund would then be paid to reward that innovator. And so, the 
R&D would be paid for.
    What we could do after that is allow a number of different 
companies to produce that drug.
    Senator Sanders. Well, the point here is, we are rewarding 
and incentivizing the research.
    Ms. Moon. Absolutely.
    Senator Sanders. Once we have a product, we're allowing a 
competitive and generic market out there, by definition.
    Ms. Moon. That's exactly right.
    Senator Sanders. And the price will be affordable to 
people.
    Ms. Moon. That's exactly right.
    Senator Sanders. It will not be controlled by one company, 
who can then charge a very, very high price.
    Ms. Moon. That's exactly right.
    Senator Sanders. Would others like to comment on that 
concept? Does that make sense? Fairly radical concept, but what 
do you think? People have any familiarity with that?
    Sir. Dr. Frattarelli.
    Dr. Frattarelli. You know, one other option I'd like to 
mention here--it's not always the case that we have to go ahead 
and actually develop a whole new drug from scratch. A lot of 
what's going on right now is that people are using these drugs 
off-label, basically on an individual-case basis. All right? 
And, as I was mentioning earlier, we're not doing anything, 
collectively, to capture all that information right now. I 
think we could get a lot of benefit by taking these children, 
who are already being exposed to the risk of this therapy--
right?--they're already taking these drugs off-label, and 
they're getting some of the benefit here, but we're getting 
that benefit on an individual label, not as a global sort of 
understanding of medicine-as-a-whole level. So, if we can go 
ahead, take this information, centralize it all in one place.
    Another advantage I see of doing something like this would 
be that, while we're deciding what information we need to 
centralize, instead of having one individual physician doing 
this, you may have a group of, you know, 20 or 30 smart people, 
here, who can all say, ``Well, you know, if you have this 
treatment, these are really the things you want to focus on, in 
terms of what a side effect might be.'' And so, I think it's 
going to step up everyone's game, in terms of following the 
safety for these things.
    Senator Sanders. OK, let me just jump in, because my time 
is running out.
    First of all, I want to really applaud every single one of 
you for the outstanding work that you have done in your areas. 
And again, we're dealing today with rare diseases, and we're 
dealing with neglected diseases. So, some of these diseases are 
not necessarily rare--they may be impacting millions of 
people--but those folks are not getting the treatment.
    Ms. Moon, in general, do you think the industry and 
government--and this is not just in the United States, it's 
internationally--have the developed countries played the kind 
of appropriate role that they should be playing, in terms of 
getting the medicines and the diagnosis to people in the Third 
World, in developing countries, that they require?
    Ms. Moon. If I understand--the question is, Are industry 
and government playing the roles that they should be?
    Well, of course industry and government can always do more. 
And that's why we would ask that the new Global Health 
Initiative include some of the deadliest tropical diseases that 
I mentioned earlier.
    But, I do think that industry responds to the public 
policies that government puts in place. And this is why this 
hearing, and others like it, are so important. But, if we can 
put in place the right new incentive mechanisms, we're quite 
confident that industry would respond by delivering the types 
of innovation that we need, that would respond to the public 
health needs of people with orphan diseases, as well as 
neglected diseases.
    Senator Sanders. But, my guess is that government is going 
to have to play a strong role here, because, left alone, 
industry is not going to make a whole lot of money in providing 
a product to people who make a dollar a day.
    Ms. Moon. In the current system, we would not expect 
industry to respond that way. It doesn't make sense, with the 
current rules. But, if we can change the rules and put in place 
new incentive mechanisms, we do think they would respond. And 
that's what we've heard in private conversations with people 
from some of the largest drug companies.
    Senator Sanders. Which brings us back to the prize concept.
    Thank you very much, Mr. Chairman.
    Senator Brown. Thank you.
    Ms. Moon, we are going to just ask Mr. Crowley a question, 
in closing, but in our list for the priority review voucher, we 
had 16 rare diseases or neglected diseases, around the world, 
as you know. We want to add the rare pediatric diseases in this 
country, but we also plan to, in this legislation, do that, add 
Chagas. It was an oversight in those 16. I think most of the 
other ones you mentioned are included in the 16, I believe. 
But, if they're not, certainly come to us, as we work on this.
    This is the last question, Mr. Crowley. I asked Dr. 
Frattarelli the same question. What do you think the most 
significant barrier to research and development for rare and 
neglected pediatric diseases is?
    Mr. Crowley. I think the most significant barrier, Senator, 
is uncertainty. When we go to start new biotechnology 
companies--and they're all started virtually the same way--with 
the technology, with patents, usually out of a university--and 
we meet with a venture capitalist, and they ask us questions 
about the technology and the patents, but they want to know, 
What's the regulatory path? How long is it going to take? 
What's it going to cost? And, once you're on the market, are 
insurance companies going to pay for these drugs? What's the 
size of the market?
    And right now, those answers are so incredibly variable and 
increasingly uncertain that a lot of adventure investors, a lot 
of other players in the field--although for the last 10 or 15 
years, there's been a lot of excitement about rare diseases, I 
still think the excitement is there, but the barriers have 
actually risen. And I think the more that we can do to reduce 
that uncertainty through different pronouncements, better 
guidance, more use of surrogate endpoints, the biostatistics, 
potentially even the division--and one of our recommendations 
is the creation of a review division at FDA focused 
specifically on rare genetic metabolic disorders. I think 
anything that we can do to take the middle part of that 
funnel--you've had a lot of patients on this side, you've got a 
lot of technologies in the early stage of development here--
they tend to get squeezed in the middle, through the clinical 
development--the more that we can do to reduce that 
uncertainty, to drive it forward, partly through different 
regulations and pronouncements, and also, too, through 
increased capital available to companies like ours, I think 
will go a long way to solving the problem.
    Senator Brown. Well, thank you.
    Thank you all for your commitment, your activism, and your 
work that you do for so many around the country whom you don't 
know, and around the world. I thank you all for that, 
especially this panel.
    I thank Bill, with Senator Harkin's staff, and Amy and 
Hayden, with Senator Enzi's staff. This is a hearing that shows 
a good side of the U.S. Senate, with the kind of bipartisan 
cooperation that Senator Enzi is known for around here. And I 
appreciate working with him on this. And, Senator Sanders, 
thank you for your question, too.
    The record will remain open for 10 days for statements to 
be submitted. If you have anything that you left out today, if 
you want to add, or any requests of us, certainly make those 
available to the committee in the next 10 days. As I said, the 
record will be open until then.
    Thank you, again.
    This Committee on Health, Education, Labor, and Pensions 
will be adjourned.
    Thank you.
    [Additional material follows.]

                          ADDITIONAL MATERIAL

                  Prepared Statement of Senator Murray

    Thank you, Senator Harkin, for holding this hearing.
    Rare diseases, particularly rare pediatric diseases, are 
very challenging for research funding and drug therapies. They 
tend to have less money dedicated to research and treatments, 
but there are still patients across the country who desperately 
need for cures to be found. So we need to find ways to 
encourage investments and find a safe way to streamline the 
approval process for life-saving drugs.
    I am pleased that through the passage of health care 
reform, we authorized the Cures Acceleration Network (CAN). 
This initiative seeks to cut the time between discovery and 
development of drugs and therapies through new grant-making 
mechanisms at the NIH. It will establish CAN within the Office 
of the Director of NIH and authorize grants expected to speed 
the move from discoveries in the lab to the next generation of 
therapies. In addition, CAN will help coordinate the efforts of 
all stakeholders in the drug development process in order to 
help move discoveries forward.
    The biomedical and life science industry has been a leader 
in the quest to find cures for rare diseases, and we need their 
great work to continue. This industry has the remarkable 
ability to create new and breakthrough medicines, allowing us 
to treat diseases that were previously untreatable and give 
hope back to families that had thought there was none.
    That is why I am so proud that my home State of Washington 
is a leader in the life science industry, with universities and 
biomedical firms doing fantastic work finding innovative cures 
and medical therapies for a vast array of diseases.
    Not only are Washington State companies on the cutting edge 
of biomedical research, they are also a major driver of 
economic development in my home State. According to a study 
published last fall by the Washington Biotechonology and 
Biomedical Association, the life sciences industry in 
Washington State directly employs over 22,000 people, and an 
additional 55,000 jobs in the State depend on this sector. It 
is also important to note that while employment has been 
declining in many sectors, the life sciences industry has 
continued to add jobs despite the economic downturn.
    Once again, I am pleased that the HELP Committee held this 
hearing to bring more attention to this critical issue. I look 
forward to continuing to work to support this industry and 
their important work, and to help families and patients across 
the country by supporting the quest for cures to rare and 
neglected pediatric diseases.
   Prepared Statement of the Advanced Medical Technology Association 
                               (AdvaMed)

                                Summary

    ADVAMED ORPHAN AND PEDIATRIC DEVICE DEVELOPMENT RECOMMENDATIONS

Humanitarian Use Device Program
     Provide the Secretary with authority to selectively raise 
the annual population cap for specific pediatric conditions when FDA 
determines the health of pediatric or orphan patients requires an 
increase.
     Ensure parity with the orphan drug program by creating a 
tax credit for orphan and pediatric device research and to help offset 
high R&D costs associated with small populations.
     Develop guidance on level of evidence needed to meet the 
HUD standard of safety and probable benefit.
     Develop guidance to clarify for payors that HUDs are FDA-
approved devices for reimbursement purposes.
     Remove HDE limitations placed on diagnostic devices that 
limit development of diagnostic tests for rare diseases.
Make Better Use of Existing FDA Regulatory Tools and Valid Scientific 
        Evidence
    While maintaining the existing standard of safety and 
effectiveness, where appropriate FDA should:

     Use objective performance criteria (OPCs), historical 
controls or well-documented case histories as endpoints to show 
effectiveness.
     Allow the extrapolation of clinical data between different 
sizes of the same device based on engineering testing and other non-
clinical data.
     Rely on non-clinical data for modifications of devices 
specifically approved for pediatric patient populations when such 
modifications are unrelated to changes in intended use.
     Allow the acceptance of 510(k) devices intended for adult 
populations with the same use as a pediatric device as predicates for 
the 510(k) pediatric device.
     Allow the acceptance--as an appropriate control for 
investigational pediatric devices--of devices intended for use in adult 
populations when such devices provide the only device-related means for 
treating, diagnosing or preventing diseases or conditions in pediatric 
patients and have become the standard of care for such patients.
     Allow use of general device claims where appropriate 
rather than requiring specific device claims for each pediatric age 
bracket to respond to the broad definition of pediatric (from neonate 
to age 21).

               OTHER FDA AND NIH-RELATED RECOMMENDATIONS

     Establish Compassionate Use Orphan/Pediatric Device 
Program to allow manufacturers to distribute no more than 100 
unapproved devices annually to pediatric patients when such patients 
are afflicted with diseases or conditions that affect too few patients 
annually to justify the expense necessary to achieve an approved device 
under the HDE program. Appropriate controls would be specified.
     Develop adaptive clinical trial designs and regulatory 
models to respond to regulatory barriers and small population sizes.
     Create Orphan and Pediatric Ombudsman in CDRH to assist 
manufacturers in how to use existing and new regulatory pathways to 
achieve on-label indications.
     Develop custom device guidance to clarify the number of 
custom devices that can be manufactured.
     Ensure collection and prioritization of data on unmet 
pediatric needs through NIH to identify and assist basic research 
needs, offset R&D costs associated with small populations, and spur 
technology transfer and commercialization of devices.
     Create NIH Office of Orphan and Pediatric Diseases to 
conduct and coordinate data collection, establish priorities and 
research needs and coordinate with Orphan and Pediatric Ombudsman.
                                 ______
                                 
    On behalf of AdvaMed, thank you for the opportunity to submit 
written testimony for the record to the Committee on Health, Education, 
Labor, and Pensions. This testimony includes our recommendations on 
ways to promote the development of new treatments and cures for 
treating rare and neglected pediatric diseases.
    AdvaMed represents manufacturers of medical devices, diagnostic 
products, and health information systems that are transforming health 
care through earlier disease detection, less invasive procedures and 
more effective treatments. AdvaMed's members produce nearly 90 percent 
of the health care technology purchased annually in the United States 
and more than 50 percent of the health care technology purchased 
annually around the world. AdvaMed members range from the smallest to 
the largest medical technology innovators and companies. Nearly 70 
percent of our members have fewer than $30 million in sales annually.

                              INTRODUCTION

    It is important to understand the device regulatory context with 
respect to rare diseases. The Orphan Drug Amendments of 1988 created 
the orphan products grant program. For this purpose, rare is defined as 
a prevalence of fewer than 200,000 patients in the United States. The 
related humanitarian use device program, authorized in the Safe Medical 
Devices Act of 1990, is a special product approval pathway to market 
for devices that treat or diagnose diseases and conditions that affect 
fewer than 4,000 patients per year in the United States, including 
pediatric populations and subpopulations. Although medical device 
companies are authorized to apply for grants under the orphan products 
program to support device research and development for rare diseases, 
device manufacturers can only use a Humanitarian Use Device (HUD) to 
treat rare diseases or conditions of less than 4,000 patients per year. 
FDA approval of a Humanitarian Device Exemption (HDE) authorizes a 
manufacturer to market a HUD.
    In contrast to pre-market approval (PMA) requirements which 
necessitate that manufacturers demonstrate their products are both safe 
and effective, the review standard for HDEs requires manufacturers to 
demonstrate the safety of the device, the likelihood of effectiveness 
(termed ``probable benefit''), and to demonstrate that the device will 
not expose patients to significant or unreasonable risk. This standard 
recognizes the challenges of fully establishing efficacy via clinical 
trials in very small populations but strikes an important balance by 
requiring demonstration of safety. Device manufacturers are prohibited 
from making a profit on the marketing of HUDs although they are 
permitted to recoup the costs of research and development, 
manufacturing, packaging and distribution.
    Importantly, to spur pediatric device development and under the 
leadership of Senator Christopher Dodd, the Food and Drug 
Administration Amendments Act of 2007 (FDAAA 2007) amended the 
humanitarian use device program to permit a device manufacturer to make 
a profit for HUD devices designed to meet a pediatric device need. 
FDAAA 2007 also created the Pediatric Device Consortia Grant Program 
under the FDA Office of Orphan Products Development (OOPD) to develop 
nonprofit consortia to facilitate pediatric medical device development.
    Much of AdvaMed's testimony will focus on pediatric device 
development issues because they are an important orphan ``sub-
population'' and the issues involved in pediatric device development 
exemplify many of the challenges associated with orphan diseases and 
conditions.

                  NEED TO COLLECT DATA ON UNMET NEEDS

    A key to addressing unmet orphan and pediatric device needs is to 
methodically collect data on unmet pediatric device needs including the 
number of patients with a particular disease or condition, age ranges, 
and current treatment and diagnostic options and health outcomes. At an 
October 2009 FDA workshop on pediatric clinical trial design, pediatric 
cardiovascular physician panelists pointed out that there are still 
many unanswered basic pediatric research questions. As the physicians 
noted, failure to answer or address certain basic pediatric research 
issues resulted in corresponding challenges in the FDA regulatory 
process (e.g., making it difficult for manufacturers and FDA to select 
and agree on appropriate surrogate or other clinical trial endpoints). 
Thus, attempting to understand the associated basic research questions 
related to unmet medical device needs should also be an important part 
of any data collection effort. We understand the National Institute of 
Child Health and Human Development (NICHD) has recently undertaken an 
effort to collect information on a pediatric research agenda that 
includes devices. A similar process should be utilized for orphan 
diseases although it is our understanding that the National 
Organization of Rare Diseases (NORD) has already collected or conducted 
a considerable amount of research with respect to many rare diseases.
    In addition to directed specialty evaluations, participants in 
previous National Institute of Health (NIH) conferences devoted to 
pediatric device development issues have suggested that existing 
hospital discharge databases could assist in identifying specific 
device needs for pediatric patients. Efforts to collect pediatric data 
through the establishment of registries [e.g., the American College of 
Cardiology IMPACT RegistryTM (IMProving Adult and Congenital 
Treatments)] may be another important source of such data.
    AdvaMed believes the primary responsibility for data collection 
efforts and basic research questions associated with unmet orphan or 
pediatric medical device needs should reside with the National 
Institutes of Health (NIH). NIH is the only entity with the breadth and 
depth of knowledge, funding and resources to conduct such research. 
Once such data is collected and prioritized, it should be made public 
(e.g., through a public NIH Web site or clearinghouse or for 
registries, via the Agency for Healthcare Research and Quality's 
proposal to create a registry of patient registries) to enable all 
interested stakeholders, including pediatric device consortia and 
device manufacturers to understand potential orphan and pediatric 
device development opportunities.
    It will also be important to prioritize orphan and pediatric needs, 
perhaps based on criteria such as size of patient population, public 
health need, and recognition that some small markets may not be 
commercially viable, or by targeting needs that are cross-cutting in 
nature and provide benefits beyond one subpopulation. Prioritization of 
needs is important to help determine and assess basic pediatric 
research requirements that may be beyond the resources or financial 
scope of any one device company and that should be conducted by NIH. 
Such activities may for example include assessing existing biomaterials 
for their effects in pediatric populations; identifying new 
biomaterials that are safe and effective for use in pediatric 
populations; or assisting in the basic research and development of key, 
priority research questions for devices and their related clinical 
trials. The latter activities could significantly reduce the 
development costs linked with the small markets associated with many 
orphan and pediatric disease device needs--a key barrier to device 
development--thus enhancing chances that such devices would get to 
market.
    There is a significant need to utilize government funding in more 
efficient ways to address questions that are faced by all developers of 
orphan or pediatric-focused technologies. Although the deficit may make 
it challenging to significantly increase funding for orphan and 
pediatric research, better coordination of existing or future research 
at the National Institute of Child Health and Human Development 
(NICHD), the National Heart, Lung, and Blood Institute (NHLBI), the 
National Institute for Biomedical Imaging and Bioengineering (NIBIB) or 
other relevant Institutes that target specific orphan or pediatric 
device needs could:

    1. Help spur the basic research needed for areas where breakthrough 
devices are desired;
    2. Help offset the tremendous expense associated with early orphan 
device research and development, thus enhancing commercialization 
opportunities for interested stakeholders such as device manufacturers 
or pediatric consortia; and
    3. An enhanced technology transfer program between the relevant 
Institutes and the device industry could help assure the development 
and manufacture of the needed breakthrough medical devices.
NIH Office of Orphan and Pediatric Diseases
    AdvaMed also recommends that the NIH develop an office of orphan 
diseases and conditions including pediatric populations. Such an office 
would presumably be aware of ongoing orphan or pediatric research 
issues being conducted within each institute and could also serve an 
important coordinating function with stakeholders to ensure that 
priority needs and research issues are being addressed. An office of 
this nature would be an automatic touch point for interested parties 
and stakeholders. For example, pediatric stakeholders attending FDA co-
sponsored pediatric stakeholder meetings in 2004 learned--many for the 
first time--that the National Heart, Lung and Blood Institute (NHLBI) 
was developing a number of left ventricular assist device (LVAD) 
prototypes for commercialization, an important pediatric cardiovascular 
priority. Such an office would make sure that ongoing NIH research of 
this nature received the needed attention by relevant stakeholder 
groups. Further, an NIH office that could delineate and prioritize 
orphan and pediatric device research and development needs would create 
a readily understood roadmap for congressional authorizers and 
appropriators and other stakeholder advocates to improve congressional 
funding for new orphan device development projects.

            RECOMMENDED IMPROVEMENTS IN THE HUD/HDE PROGRAM

Need for Guidance on Level of Evidence Needed to Meet Standard of 
        Probable Benefit
    As outlined at the start of our testimony, Section 520(m)(2)(C) of 
the Food Drug and Cosmetic Act (FDCA) establishes the standard for FDA 
approval of HDE applications, specifically that ``the device will not 
expose patients to an unreasonable or significant risk of illness or 
injury'' and that ``the probable benefit to health from the use of the 
device outweighs the risk of injury or illness from its use, taking 
into account the probable risks and benefits of currently available 
devices or alternate forms of treatment.'' This is clearly a different 
standard than the pre-market approval (PMA) requirement of reasonable 
assurance of safety and effectiveness which typically requires full-
scale prospective randomized clinical trials because you cannot 
reasonably conduct such a trial in small populations. However, FDA has 
provided no general guidance to manufacturers regarding the type or 
level of evidence that must be developed to demonstrate that an HDE 
meets the probable benefit standard. This lack of guidance ultimately 
hinders the use of the HUD program as a pathway to market for devices 
that treat or diagnose diseases and conditions that affect fewer than 
4,000 patients, including pediatric populations and subpopulations. 
Further, without clear FDA guidance, demands for evidence can continue 
to drift upward, until they begin to resemble the expectations for a 
PMA filing, as has been reported by some manufacturers.
    For this reason, AdvaMed recommends that FDA develop general 
guidance on appropriate types and levels of data necessary for HDE 
approval. Such guidance should provide examples of what FDA believes 
are the appropriate types and levels of data needed to demonstrate 
probable benefit. AdvaMed believes that prospective randomized 
controlled clinical trials generally should not be necessary to 
demonstrate probable benefit to health, and that FDA should consider 
non-clinical data, published literature, historical data and patient 
records, surrogate endpoints and statistical methods and evidence from 
experience with similar devices.

FDA Guidance on HUD as an Approved Device Needed for Reimbursement 
        Purposes
    On a related point, during FDA-sponsored pediatric stakeholder 
meetings on pediatric device development in 2004, numerous participants 
pointed out that private insurers typically refuse to reimburse for 
pediatric HUDs. The statute requires that HUDs can only be administered 
in facilities with properly constituted and functioning IRBs. Insurers 
thus assume the HDE must therefore be an investigative device that is 
not eligible for private insurer reimbursement. As a result, many 
times, costs associated with HUDs are out-of-pocket. While payment 
issues are not within the normal purview of FDA, in this instance, 
inclusion of an additional Question and Answer in FDA's HUD/HDE 
guidance that explicitly states that a HUD has FDA approval could be a 
useful addition to the guidance, assisting facilities and physicians in 
seeking reimbursement, improving patient access to needed HUDs, and 
importantly, helping patients avoid unnecessary out-of-pocket costs. 
For this reason, AdvaMed recommends that language be added to the 
guidance that explains that an HUD constitutes an explicit approval 
from FDA. Similarly, the Centers for Medicare and Medicaid Services 
(CMS) should have a process to cover and reimburse HUDs. Insurers 
frequently follow the lead of CMS with respect to coverage and 
reimbursement decisions.

Provide Flexibility on the HDE Cap
    AdvaMed also believes that because there continues to be so little 
information on the size of certain orphan and pediatric populations 
associated with specific conditions (due among other reasons to the 
lack of data on unmet pediatric device needs), it is unknown what 
affect applying the general HDE population cap of 4,000 to children's 
devices may have on the availability of devices to treat pediatric 
conditions. AdvaMed recommends that the Secretary be given authority to 
selectively raise the cap for specific conditions when FDA determines 
the health of orphan or pediatric patients requires an increase in 
excess of the annual distribution number--based on medical, demographic 
and scientific information provided by a petitioner. As an example, it 
is unlikely manufacturers will be incentivized to develop devices for 
an orphan disease that affects 4,500 patients annually and is under 
full PMA requirements, yet because the population is only 500 patients 
over the 4,000 cap, it is ineligible for the HUD program.

Remove HDE Limitations Placed on Diagnostic Devices for Rare Diseases
    A significant obstacle to using the HDE process for development of 
diagnostic devices for rare diseases is the HDE requirement to 
demonstrate the number of patients that would be subject to diagnosis 
by the device, rather than the number of individuals affected or 
manifesting the rare disease. Unlike other medical devices, where a 
demonstration by authoritative references that the disease or condition 
affects or is manifested in fewer than 4,000 people in the United 
States per year, for a diagnostic device it is necessary to demonstrate 
by authoritative references that the number of patients per year who 
would be tested by the device is fewer than 4,000. Because such data is 
generally unavailable, the identification and presentation of 
authoritative references to support this requirement essentially 
renders the HDE process unavailable for diagnostic devices. In short, 
if a diagnostic test were developed to diagnose patients with a 
condition that manifests in 4,000 people or less per year, it is quite 
likely that physicians would prescribe the test more than 4,000 times a 
year in order to diagnose those with the referenced rare disease. To 
address this limitation, we recommend removing this requirement and 
requiring the same demonstration of diagnostic devices as is required 
for other medical devices.

Proposals to Help Offset Costs of R&D and Commercialization Risks
    In addition to the proposals and comments outlined above, AdvaMed 
has a number of other recommendations to improve orphan and pediatric 
device development. Many of these programs would help offset the costs 
of orphan or pediatric device research and development and address 
small market size and commercialization risks. These include:

     A strong orphan and pediatric device research and 
development tax credit program,
     A tax credit for orphan and pediatric HDEs similar to the 
tax credit that currently exists for orphan drugs,
     Minimization of governmental costs associated with 
developing products for orphan and pediatric populations such as 
restrictions on user fees,
     Expedited FDA clearance or approval of orphan or pediatric 
device applications, and
     Clear pathways for reimbursement once such products are 
cleared or approved.

Orphan and Pediatric Ombudsman in the Center for Devices and 
        Radiological Health
    AdvaMed also recommends the creation of an orphan/pediatric 
ombudsman in the Center for Devices and Radiological Health (CDRH). 
Currently, no one person or entity within CDRH has either the 
responsibility or the expertise to assist and counsel manufacturers or 
other interested stakeholders in how to utilize existing regulatory 
pathways (510(k), PMA or HDE) to achieve on-label indications for 
orphan and pediatric diseases and conditions. This individual could 
also serve as the liaison with an NIH office of orphan and pediatric 
diseases and conditions.

    ADVAMED RECOMMENDATIONS TO RESPOND TO CHALLENGES TO ORPHAN AND 
                      PEDIATRIC DEVICE DEVELOPMENT

    A key challenge in orphan and pediatric conditions and diseases is 
that failure to overcome certain regulatory or other barriers to on-
label use consigns certain devices and the diseases and conditions they 
treat to an unending cycle of ``jerry-rigging'' or off-label use. As a 
result, data that could be used to improve device research and 
development, obtain on-label indications, or improve patient outcomes 
is never collected. It is not clear that orphan or pediatric 
populations are well-served by this un-ending cycle. While it may not 
be feasible for all orphan diseases or conditions and their associated 
devices, a concerted effort must be made to find ways to break this 
cycle and enable companies and clinicians to begin to obtain and to 
collect the data that will allow devices for orphan and pediatric 
diseases and conditions to be on-label.

                           SMALL MARKET SIZES

    A related and significant obstacle to pediatric device development 
for devices ineligible for HUD is that the annual market associated 
with specific diseases and conditions may not be commercially viable 
(for either large or small device companies). Secondly, orphan diseases 
and conditions are difficult to study because patients with the 
affected conditions are widely dispersed making it extremely difficult 
to accrue sufficient numbers of clinical trial participants over a 
reasonable timeframe and within a manageable number of investigational 
sites and to assure an adequately powered clinical trial to meet FDA 
requirements. AdvaMed has a number of recommendations below that are 
responsive to small market size and failure to overcome regulatory 
barriers to on-label use.

General versus Specific Device Claims
    FDA requirements for limited and very specific claims and their 
associated data can be an important barrier to device development for 
small and dispersed orphan and pediatric populations. For example, FDA 
may require 100 patients in each pediatric age group to demonstrate 
device safety and effectiveness. FDA should consider and allow for more 
general claims to enable device approval. Subsequent condition of 
approval requirements, such as requirements for a registry, could then 
be used to ascertain whether there are particular issues associated 
with specific age ranges.

New Regulatory Models and Adaptive Clinical Trial Designs
    To address small market issues, FDA must develop regulatory models 
and adaptive clinical trial designs that take into consideration the 
reduced sample sizes associated with orphan diseases and conditions. 
For example, FDA could approve certain devices based on smaller 
confirmatory trials in conjunction with a long-term registry 
requirement either for an individual device or for certain device 
types. This would enable the collection of essential data to better 
understand patient outcomes and provide FDA with better data for future 
device approval decisions. Related to this, to facilitate pediatric 
device development by interested stakeholders (e.g., manufacturers or 
pediatric consortia), FDA should post on its Web page, examples of 
adaptive clinical trial designs\1\ that have already been successfully 
used to obtain on-label orphan or pediatric indications.
---------------------------------------------------------------------------
    \1\ FDA must take care not to reveal proprietary or trade secret or 
confidential commercial or financial information when sharing trial 
designs.
---------------------------------------------------------------------------
Valid Scientific Evidence Other Than Well-Controlled Trials
    Section 513(a)(3)(A) of the Federal Food Drug and Cosmetic Act and 
21 CFR 860.7 give FDA authority to utilize valid scientific evidence 
other than well-controlled trials.
    Importantly, the standard of reasonable assurance of safety and 
effectiveness is the same no matter what type of scientific evidence is 
required. While FDA relies on many types of valid scientific evidence 
(other than well-controlled trials) in other areas, it is our sense 
that FDA has been reluctant to take advantage of this statutory 
authority in the case of pediatric devices.
    FDA should be encouraged to make better use of all forms of valid 
scientific evidence which could help address the problems associated 
with the extremely small numbers of orphan or pediatric patients that 
are afflicted with any one condition or disease state. For example, 
what may have evolved as the pediatric standard of care may be off-
label (e.g., a minimally invasive procedure supersedes a surgical 
procedure and becomes the standard of care). Doctors will be reluctant 
to randomize pediatric patients to a surgical control arm if the 
minimally invasive procedure is the standard of care. Parents will also 
be reluctant to have their child participate in such trials. In this 
instance, an FDA requirement to randomize pediatric patients to the 
surgical procedure creates a barrier that prevents the off-label use of 
the device from ever becoming on-label. Where numerous articles 
document the effectiveness of a particular off-label use of a device 
and it has become the standard of care, FDA should be encouraged to 
develop mechanisms that make use of this data.
    AdvaMed has a number of recommendations that are intended to make 
better use of existing FDA regulatory tools and enhance orphan or 
pediatric access to medical devices. To help break down barriers to 
orphan and pediatric device development, FDA should provide examples of 
these or other types of valid scientific evidence that FDA has in FDA 
guidance. Importantly, the proposals below retain the existing standard 
of reasonable assurance of safety and effectiveness although some of 
the recommendations may be applied to the HUD standard of safety and 
probable benefit.
    1. Proposal: Where appropriate FDA should use objective performance 
criteria (OPCs), historical controls or well-documented case histories 
as endpoints to show probable benefit or to demonstrate effectiveness.
    Background: Reliance on well-documented case histories and 
historical controls would take advantage of the existing literature, 
respond to the extremely small numbers of orphan or pediatric patients 
with any one condition (which makes it difficult to run statistically 
valid clinical trials in a timely fashion--as one person put it ``20 
years of literature vs. years to put together a control group'') and 
help minimize the use of surgical interventions as the control where 
devices have been established as the standard of care.
    2. Proposal: Extrapolation of clinical data between different sizes 
of the same device based on engineering testing and other non-clinical 
data.
    Background: Currently, FDA requires clinical evidence on the full 
range of device sizes for a particular device and it can be difficult 
to assemble enough patients at either end of the size ranges to be 
valid. It is often extremely challenging to get significant data on the 
smallest and largest sizes. This proposal would allow the use of non-
clinical and bench data as well as the potential to do post-market 
clinical work to approve the full range of sizes.
    3. Proposal: Reliance on non-clinical data for modifications of 
devices specifically approved for pediatric patient populations, when 
such modifications are unrelated to changes in intended use and do not 
affect safety.
    Background: Modifications made to an already cleared or approved 
device to improve its performance or safety require that the device be 
cleared or approved again. For devices, much of the data about a 
product's function can be established non-clinically (e.g., relying on 
animal, bench and/or reliability testing). Every time a minor 
modification is made (e.g., material changes or minor design changes), 
FDA often requires that the device be cleared or approved again. The 
requirements for clinical data in the modification process create a 
challenge and limit improvements for pediatric devices. Due to the 
barriers associated with gathering clinical data for pediatrics (small 
populations, widely dispersed populations, parental unwillingness to 
have children participate, timeliness, etc.), the intent of this 
provision--for devices specifically approved for pediatric use--is to 
enable use of engineering and bench testing, rather than clinical 
testing for minor device changes when the changes are not related to 
changing the intended use of the device and do not affect safety. FDA 
has the flexibility to do this--and allows it for adult devices--but 
should be specifically encouraged to do so in the case of pediatric 
products.
    4. Proposal: The acceptance of 510(k) devices intended for adult 
populations with the same use as a pediatric device as predicates for 
the 510(k) pediatric device.
    Background: Similar to the language proposed in the FDAAA 2007 
pediatric device law which allows FDA to use adult data to support a 
reasonable assurance of safety and effectiveness in pediatric 
populations and to extrapolate data between pediatric populations, FDA 
has authority, where the course of the disease or effect of the device 
is the same in adults and in pediatrics, to use the adult 510(k) device 
as a predicate for the pediatric device. Doing so would be responsive 
to the extremely small numbers of pediatric patients--particularly of a 
given age range--with any one condition (which makes it difficult to 
run valid clinical trials in a timely fashion) and would help limit the 
number of children exposed to surgical controls. FDA could still 
require a clinical trial for a 510(k) device but the trial would be 
smaller and pediatric access to the device would be faster.
    5. Proposal: The acceptance--as an appropriate control for 
investigational pediatric devices--of devices intended for use in adult 
populations when such devices provide the only device-related means for 
treating, diagnosing or preventing diseases or conditions in pediatric 
patients and have become the standard of care for such patients.
    Background: Similar to the language proposed in the new pediatric 
device law which allows FDA to use adult data to support a reasonable 
assurance of safety and effectiveness in pediatric populations and to 
extrapolate data between pediatric populations, FDA has authority to 
utilize as the control for studies under the Investigational Device 
Exemption process, devices that are not approved for pediatric use but 
that are already being used in pediatric populations. This would enable 
the adult data on already approved devices or these devices themselves 
to serve as the ``control'' for the pediatric trial, responding to the 
limited number of pediatric patients available for pediatric trials and 
reducing the number of children exposed to a surgical control.

Development of Custom Device Guidance
    Section 520(b) of the FDCA and 21 CFR 812.3(b) provide for the 
manufacture of custom devices that are intended for use by an 
individual patient in response to a clinician's order. In the ongoing 
pediatric stakeholder dialogue, clinicians have repeatedly reported 
that they feel compelled to ``jerry-rig'' or modify existing devices to 
treat pediatric patients. Dr. Jon Abramson (representing the American 
Academy of Pediatricians) reiterated this point at a July 23, 2008 NIH 
workshop. Pediatric patients may also suffer more congenital 
deformities which may require customized devices. AdvaMed recommends 
that FDA develop guidance for custom devices that clarifies the number 
of devices manufacturers may customize for orphan and pediatric 
populations, a recommendation that was echoed by former Center for 
Devices and Radiological Health Director, David Feigal, Jr., M.D., at a 
July 23, 2008 NIH pediatric device workshop.
    Manufacturers have been reluctant to develop custom devices because 
the rules are unclear. Anecdotal evidence suggests that FDA limits 
manufacturers to just one or a few custom devices although this has not 
been articulated in FDA guidance. AdvaMed has heard from manufacturers 
that they, on occasion, are compelled to choose between complying with 
FDA requirements and pediatric patients' needs with the knowledge and 
heavy burden that their decision to adhere to FDA requirements may 
result in a dire outcome for the child. Given that FDA's formal 
definition of pediatric is from neonate to age 21, that so many 
different device sizes are required to treat this wide age range, and 
the small market sizes that may be associated with this wide size-
range, custom devices may be the only alternative for some medical 
devices. FDA guidance on custom devices that relaxed the current 
limitation on manufacturing (which we believe is just one or two custom 
devices) and that specified the number of orphan or pediatric custom 
devices that could be manufactured and distributed would be helpful. 
Envisioned here is a special program for unique devices for very small 
orphan or pediatric populations or very early device modeling that 
could encourage development of these therapies.

Proposal of a Compassionate Use Orphan/Pediatric Device Provision
    Finally, AdvaMed recommends the creation of a New Compassionate Use 
Orphan/Pediatric Device Provision to be applied in situations where 
even the HUD pathway makes little sense. As mentioned elsewhere in our 
testimony, clinicians have repeatedly reported that they feel compelled 
to ``jerry-rig'' or modify existing devices to treat pediatric 
patients. Rather than having pediatric clinicians across the country 
individually jerry-rig devices during surgery, AdvaMed proposes a well-
regulated mechanism to provide device access for super-small, orphan or 
pediatric populations that are not likely to be served by the HUD 
program or the FDAAA 2007 pediatric HUD program. AdvaMed recommends 
that FDA be required to develop regulations that would allow 
manufacturers to distribute no more than 100 unapproved devices 
annually for patients when such patients are afflicted with diseases or 
conditions that affect too few patients annually to justify the expense 
necessary to achieve an approved device under the HUD program. 
Appropriate controls would be statutorily mandated including: (1) 
compliance with quality system, labeling, adverse event reporting, 
device tracking and postmarket surveillance regulations; (2) device 
promotion would be limited to medical professionals and no claims of 
safety or effectiveness could be made; (3) the manufacturer would be 
required to notify the Secretary upon the first shipment of such a 
device; (4) maintenance of records of each shipment of such a device; 
(5) limitation of distribution to prescription use only; (6) 
institutional review board approval would be required for each use of 
such a device; and (7) informed consent prominently informing the 
patient and the patient's parent or legal guardian that the device is 
not approved by the Food and Drug Administration would be required.
    In closing, AdvaMed greatly appreciates this opportunity to provide 
our thoughts and recommendations to the Committee on Health, Education, 
Labor, and Pensions on rare disease and pediatric device development 
issues.

     Prepared Statement of Peter J. Hotez, M.D., Ph.D., President, 
                        Sabin Vaccine Institute

    On behalf of the Global Network for Neglected Tropical Diseases and 
the Sabin Vaccine Institute, our organization welcomes the opportunity 
to submit a written statement affirming two specific issues raised 
during the committee's hearing on July 21, 2010 entitled, ``Treating 
Rare and Neglected Pediatric Diseases: Promoting the Development of New 
Treatments and Cures.''
    Before outlining the specific issues we would like to address, we 
thought it would be best to provide the committee with some background 
on the Sabin Vaccine Institute and two of its important initiatives. 
Founded in 1993, the Sabin Vaccine Institute is a non-profit 501(c) (3) 
organization dedicated to preventing and curing infectious and 
neglected tropical diseases worldwide and eliminating the tremendous 
human suffering they cause. An essential element of the Sabin Vaccine 
Institute's mission to reduce human suffering caused by infectious and 
neglected tropical diseases (NTDs) is our vaccine development program 
conducted in collaboration with the George Washington University and 
other international organizations, including the Oswaldo Cruz 
Foundation and Instituto Butantan (Brazil), Queensland Institute of 
Medical Research (Australia), the London School of Hygiene and Tropical 
Medicine (United Kingdom), and The Institute of Parasitic Diseases 
Chinese Center for Disease Control and Prevention (China).
    In 2000, Sabin established an innovative non-profit Product 
Development Partnership (PDP) to develop new vaccines for human 
hookworm infection, schistosomiasis and other NTDs. Our vaccine 
development program is the first and only PDP with a mission to develop 
a vaccine to confer preventive immunity against human hookworm 
infection (``hookworm''), an NTD that threatens vulnerable populations 
around the globe. An estimated 576 million people suffer from hookworm, 
primarily in the most impoverished communities of sub-Saharan Africa, 
Asia, and Latin America. In these countries, hookworm is a leading 
cause of anemia and malnutrition. Children are among the most 
vulnerable populations, and suffer from severe growth and cognitive 
delays as a result of this disease. Women of reproductive age, 
including pregnant women, are also highly susceptible.
    We have established a vaccine development pipeline that contains 
multiple antigens at various stages of development. Our vaccines 
undergo clinical testing in Brazil, a country where large numbers of 
people are affected by hookworm infection. In addition, Sabin Vaccine 
Development is pioneering the creation of some other vaccines that have 
no traditional commercial market. The diseases represent the most 
common scourges of the world's poorest people, including hookworm, 
schistosomiasis, and malaria. Our vaccines enter into clinical trials 
following regulatory submissions to the U.S. FDA and ANVISA, the 
national regulatory authority in Brazil.
    The Global Network for Neglected Tropical Diseases is another 
initiative of the Sabin Vaccine Institute dedicated to raising the 
awareness, political will, and funding necessary to control or 
eliminate the most common NTDs--a group of disabling, disfiguring, and 
sometimes deadly diseases affecting more than 1.4 billion people 
worldwide living on less than $1.25 a day through mass drug 
administration campaigns. The seven most common of these NTDs--
ascariasis (roundworm), trichuri-asis (whipworm), hookworm, schistosomiasis 
(snail fever), lymphatic filariasis (elephantiasis), trachoma (blinding 
trachoma), and onchocerciasis (river blindness)--account for 90 percent of 
the NTD burden around the globe. Research has shown that some of these 
diseases, such as LF, onchocerciasis, and trachoma can be eliminated 
through mass drug administration, while others such as hookworm can be 
controlled temporarily until the vaccine is developed. These mass drug 
administration treatments can allow millions to climb out of poverty 
through increased access to education and improving economic 
performance.
    Because of the Sabin's commitment to drug development and its fight 
to control and eliminate NTDs globally, we affirm the steps the Food 
and Drug Administration (FDA) is taking in implementing Section 740 of 
the fiscal year 2010 Appropriation Act (Agriculture, Rural Development, 
Food and Drug Administration, and Related Appropriation Act, 2010, 
Public Law 111-80) to establish expert review groups and issue guidance 
related to rare and neglected diseases. This work conducted by the FDA 
will further enhance the work of those in the research and development 
field and streamline product availability. In particular, it should 
allow for clarity in the review process for products, such as new 
vaccines for NTDs that would not necessarily be used within the United 
States but could have significant impact on the disease burden 
resulting from neglected diseases around the world. Furthermore, the 
use of the Priority Review Voucher process to provide incentive for the 
development of new products targeting the NTDs is welcomed.
    Additionally, Sabin and the Global Network will look forward to 
participating in the Part 15 hearing to be held this fall, which will 
focus on the development of medical products used in the prevention, 
diagnosis, and treatment of neglected tropical diseases and assist the 
FDA in the collection of stakeholder comments to update its development 
and approval guidance.
    Another important issue discussed before the committee is the need 
for new incentive mechanisms to de-link the cost of research and 
development from the eventual revenues to be obtained from the sale of 
new health products or medicines. The concept of de-linking would help 
ensure that the right products for NTDs reach the end of the 
development pipeline despite the lack of a commercial market. 
Alternative incentives, such as prizes or other forms of ``pull 
funding,'' are essential to stimulate the development of new vaccines, 
drugs, and diagnostics for the NTDs. This concept is something that 
Sabin strongly supports.
    Again, we appreciate the opportunity to share our views and 
contribute to this important global health discussion and the work of 
this committee to streamline the development and approval of medicines 
and treatments that target rare and neglected diseases. If the 
committee should have any further questions about this statement or 
programs of the Sabin Vaccine Institute Diseases, please do not 
hesitate to contact me.
    Thank you.
        Prepared Statement of the Huntington's Disease Society 
                           of America (HDSA)

    Chairman Harkin and Ranking Member Enzi, on behalf of the 
Huntington's Disease Society of America (HDSA), we applaud you for 
holding this important hearing to discuss treating rare and neglected 
pediatric diseases. We appreciate the committee's commitment to this 
issue and hope that through increased awareness and Federal research 
dollars we can find a cure for Juvenile Huntington's Disease (JHD).
    Huntington's Disease (HD) is a rare, genetic, neurodegenerative 
disease that causes total physical and mental deterioration over a 10- 
to 25-year period. HD affects 30,000 Americans while another 200,000 
are considered ``at risk'' of inheriting it from a parent. Even more 
rare is JHD, which affects only 10 percent of individuals with HD.
    Early signs of JHD include rigidity, slowness and stiffness, 
clumsiness of arms and legs, behavioral changes, decline in cognitive 
function, seizures and more. There is no cure for JHD or adult HD. 
Today, physicians prescribe a number of medications to control 
emotional and movement problems associated with the disease but there 
is no treatment to stop or reverse the course of HD or JHD.
    Increasing awareness of rare, orphan diseases is one way that we 
can find a cure for diseases like JHD. Currently, there is legislation 
in the House and shortly to be introduced in the Senate, the 
Huntington's Disease Parity Act (H.R. 678), which has received the 
support of nearly 140 Members of Congress. Current Social Security 
Administration (SSA) guidelines for determining disability for 
individuals with HD is more than 30 years out-of-date. Even more 
alarming is that the SSA has failed to acknowledge the existence of 
JDH. H.R. 678 not only updates the medical criteria and guidelines for 
HD, but also directs the SSA Commissioner to include JHD in its list of 
Pediatric-Neurological diseases. Further, the bill also removes the 2-
year waiting period for those with HD to receive critical Medicare 
benefits.
    Another way Congress can promote the development and treatment of 
rare diseases is through the expansion of Federal research dollars. 
Current HD research examining the processes of HD is helping scientists 
and researchers identify new therapies and tools that are applicable to 
other neurodegenerative and genetic diseases. While most of the current 
research is focused on adults, the symptoms of JHD appear much earlier 
and the progression of the disease is much more rapid from symptomatic 
onset. Therefore JHD's biological, chemical, metabolic and molecular 
processes may be easier to identify and flag--and thus our 
understanding of Huntington's disease, other juvenile neurodegenerative 
and genetic illnesses, and the means to thwart their progression.
    We were also especially pleased to see that the Senate 
Appropriations Committee included funding for the Office of the 
Associate Director for Rare Diseases at the FDA and increased funding 
for Orphan Product Development Grant program in the fiscal year 2011 
Agriculture, FDA, and Rural Development Appropriations bill. These two 
funding opportunities will further the clinical development of products 
used to treat rare diseases.
    In conclusion, we thank you for your support for pediatric orphan 
diseases and congressional funding for research. We also ask that you 
consider reviewing the Social Security Administrator's characterization 
of HD and JHD to ensure that the medical guidelines are accurate and up 
to date so that people with these diseases can have much-needed access 
to Social Security disability and Medicare.

 Prepared Statement of the National Venture Capital Association (NVCA)

    The National Venture Capital Association (NVCA) appreciates the 
opportunity to submit a statement on the role of venture capital 
investment in the treatment and cure of rare and neglected pediatric 
diseases. The NVCA represents the interests of more than 425 venture 
capital firms which comprise more than 90 percent of the capital under 
management in the United States. NVCA's mission is to foster greater 
understanding of the importance of venture capital to the U.S. economy, 
and to support entrepreneurial activity and innovation.
    For decades, the U.S. venture capital industry has committed itself 
to bringing groundbreaking medical innovation to the American people. 
Since the early 1970s, venture capital firms have identified the most 
promising breakthroughs in labs across the country, built companies 
around these innovations, and worked alongside scientists and 
entrepreneurs to safely commercialize these products--improving and 
saving millions of lives along the way. In fact, according to Thomson 
Reuters, venture capitalists have invested more than $81.5 billion in 
over 4,000 start-up life sciences companies in the last four decades. 
This represents approximately 30 percent of total venture capital 
investment over the same period.
    Venture capital-hacked companies have pioneered the development of 
important new treatments for a wide range of serious diseases, such as 
cancer (including many rare pediatric cancers), cystic fibrosis, 
lysosomal storage disorders and other inborn errors of metabolism, and 
many more. These kinds of rare diseases represent relatively small 
markets that frequently attract little interest from large, established 
pharmaceuticals. Venture capital-backed companies have been the engine 
of innovation when it comes to breakthrough treatments for rare 
pediatric diseases.
    NVCA wants to promote greater investment in this important area. 
However, the incentives for investment in rare diseases are at risk in 
a number of ways, and we must act now to ensure that the venture 
capital-backed innovation engine can continue to deliver important new 
therapies for rare diseases. Among other issues, we must ensure that 
the regulatory environment is conducive to investment in this area. 
Development of novel therapies for rare diseases is inherently 
difficult and risky. Patient populations are small, and it is 
frequently impossible to complete the kind of large clinical trials 
that FDA demands. It is essential that regulators recognize the unique 
challenges of developing treatments for rare diseases, and show 
appropriate flexibility in the application of regulatory standards, to 
promote the continued development of new therapies for rare diseases 
while continuing to ensure the safety and efficacy of new treatments.
    Over the years, the venture capital investment process has remained 
largely unchanged--largely because it works. Venture capitalists invest 
pools of funds in start-up companies across the country with the goal 
of making a significant return for their investors. Historically, these 
investments are made in scientific discoveries and novel technologies 
that address emerging or complex economic and social needs. This 
characteristic adds significant risk to the process, but also enhances 
the returns on successful ventures for investors, who are commonly 
State pension funds and educational endowments. Because of the high-
risk and long-term nature of the investment, no other asset class is 
positioned to invest in these types of companies. Without venture 
investment, most of these medical breakthroughs would remain in the lab 
and never reach the public.
    It is important to understand that venture capital investment 
involves more than just money. Venture capitalists invest a significant 
amount of time, energy and expertise in each of the companies in their 
portfolios. The life cycle of a venture investment typically follows 
the same path. Venture capitalists seek out the most promising medical 
breakthroughs in their early stages--looking for products or processes 
that are ready to move on to the commercialization phase. Most often, 
these innovations spring from government-funded basic research 
conducted at universities and government labs. Venture capitalists 
typically do not fund this basic research, but rather use their funds 
to apply the products of basic research to solving real-world problems.
    Once an idea is identified by a venture capitalist, the investment 
is vetted by the entire firm and the most promising ideas are funded. 
Venture capitalists, who are often scientists, engineers or doctors 
themselves, will work closely with a company's founders to build the 
business by taking a seat on the board of directors and offering 
strategic counsel as the company matures. Usually, a venture capitalist 
will invest several rounds of financing into a company over a period of 
time. The average round of financing into a biotechnology company in 
the first half of 2010 was just under $9 million. Companies must reach 
specific, pre-determined milestones in order to earn their next rounds 
of funding. If a company fails to achieve these goals, the venture firm 
may decide that the risk is too great and the chance of success is too 
small to continue funding it. In such instances, the company will 
likely go out of business.
    The goal of the venture capitalist is to one day sell the company 
to a larger player or have the company go public, generating a 
significant return on the total amount invested. In fact, many venture-
backed life sciences companies are sold to larger pharmaceutical 
corporations because it is often the optimal way for large corporations 
to acquire innovation. However, the largest returns are realized when a 
company goes public. Venture capitalists look for returns that are at 
least four times their original investment. Because many venture-backed 
companies will fail, the returns generated by the successes must 
significantly outweigh the cost of the failures for the venture 
capitalist to be successful.
    To wit, venture capital investment in life sciences is not for the 
faint at heart. It requires tremendous patience and an appetite for 
considerable risk. Due to the substantial regulatory path that medical 
innovations must travel, investment in life sciences has a 
significantly longer time horizon than other industries. Whereas a 
venture investment in a software company might last 5 to 7 years, a 
biotechnology investment typically lasts 15 years on average and can 
cost up to $800 million. Additional regulatory hurdles add to the 
length of the investment and the scope of the challenges. Not only do 
these small companies face technological and market risk (i.e., will it 
work and will it sell?) but also regulatory and pricing risk (will it 
be approved by the FDA and receive a fair price by CMS?). Over the 
years, the uncertainty surrounding the regulatory process has added 
additional risk to an already tenuous path.
    Given the role venture capitalists play in guiding life sciences 
companies through their start-up and expansion phases, they have a 
valuable perspective on the hurdles that emerging businesses confront 
and the environments that promote or stifle growth and innovation.
    Our members tell us that it is becoming increasingly difficult to 
build an investment case for new investments in novel therapies 
targeted at rare diseases, including pediatric diseases. The low-
hanging fruit is gone, and new therapies are inherently risky to 
develop. Venture investors report that FDA regulation is becoming 
increasingly inflexible. Whereas in the past, FDA appeared to show 
greater flexibility in evaluating therapies for serious, rare diseases, 
recognizing the challenges of developing these therapies, our members 
report that FDA is increasingly painting novel therapies for rare 
diseases with the same regulatory brush as other kinds of treatments 
for more common diseases. If FDA fails to apply flexible standards that 
reflect the unique challenges presented by rare diseases, then 
investment in these therapies will grind to a halt.
    Regulatory uncertainty and inconsistency can delay approvals to the 
point of bankrupting innovative companies. This trend is impeding 
patient access to critical therapies and medical technologies and is 
disrupting critical U.S.-centered research and development. This in 
turn greatly reduces the willingness on the part of venture capitalists 
to invest in disruptive medical therapies. Strikingly, venture capital 
investors are noting with alarm that novel therapies for rare diseases 
are increasingly coming to market in Europe, Japan and other parts of 
the world before they do in the United States. This points to a serious 
risk that the United States could lose its leadership position in 
medical innovation and the risk that patients with these diseases may 
suffer without access to treatments that are benefiting patients in 
other parts of the world.
    Today's hearing provides an important opportunity for NVCA to offer 
our suggestions on what can be done to create the proper incentives for 
investment in the development of new treatment and cures for treating 
rare and neglected diseases, including the pediatric population. NVCA 
believes that the following suggestions will help alleviate the 
challenges facing investors and innovators generated by the U.S. 
regulatory framework and will promote the advancement of critical life-
saving therapies, a common goal of the NVCA, the FDA, and patients.
    NVCA believes that innovative companies need:

     The application of flexible regulatory standards that 
reflect the unique challenges of drug development for rare diseases;
     A special well-defined regulatory pathway for truly 
``novel therapies'' which include therapies for rare and neglected 
diseases that is robust, collaborative and flexible, but also 
predictable;
     A process to assemble a senior tram of highly qualified 
regulatory reviewers and expert advisory panel members well-versed in 
the current science and current safety and efficacy of novel therapies;
     FDA approval requirements based on actual risk; and
     A reasonable and predictable review regimen for all 
medical therapies, including ``novel therapies.''

    FDA approval of a company's innovative product can mean the 
difference between success and failure for the business. Moreover, 
investment in emerging companies will further decrease if the 
regulatory environment remains so uncertain and burdensome as to 
jeopardize final clearance of the product. This situation prevents U.S. 
patients' access to the most innovative technologies. Unclear 
regulatory requirements, inconsistent application of regulatory 
requirements and high staff turnover can all lead to lengthy delays in 
product review times, costing the emerging company hundreds of 
thousands of dollars, or even millions of dollars, and risking future 
venture investment in the start-up. These concerns are compounded 
during the review of ``novel therapies'' which often raise issues of 
first impression for the Agency since new therapies rarely fit into the 
normal regulatory pathway.
    NVCA believes that creating a special regulatory risk-based pathway 
for ``novel therapies'' that is flexible, but predictable, would 
mitigate some of these problems, particularly if such a system were to 
focus dedicated resources and senior staff on expediting the review of 
these therapies and technologies. We suggest that the following 
specific changes relative to novel therapies at the FDA.

     Clear Definition of ``Novel.'' The term ``novel'' is not 
defined by the FDA.
     Dedicated Resources for Novel Therapies. NVCA suggests 
that the FDA dedicate a pool of cross-disciplinary, highly experienced 
staff, and significant resources to the review (including expedited 
review) of ``novel therapies.'' NVCA believes that it is important for 
the FDA to continue to hire and retain qualified medical reviewers who 
are well-versed in the current science and are up-to-date in the 
practice of medicine in the specialties by which the therapies and 
technologies they are evaluating will be used. A dedicated pool of 
qualified reviewers will ensure that the Agency focuses precious 
resources on truly innovative products, and that these therapies 
receive appropriate and timely attention from experts at the Agency. 
Moreover, by offering high-performing staff the opportunity to work 
with cutting edge therapies, it may also aid the Agency in retaining 
top reviewers, and will reduce delays due to staff turnover. Special 
fees could be required for products designated for novel technology 
review.
     Well-Defined, but Flexible, Review Process for Novel 
Therapies. Because novel products often raise new issues of safety and 
effectiveness for the Agency, a clear review process and a clear path 
for resolving disputes during the review process will provide added 
regulatory certainty and additional security for venture investment. 
For example, early, pre-clinical discussions with Agency reviewers to 
design appropriate study requirements are invaluable to start-up 
companies. In addition, continued discussions and an open dialogue with 
the Agency during the review process is essential, as is the ability to 
use new methods of statistical modeling and cutting-edge clinical trial 
designs to speed the review process. All of these items will increase 
transparency between the Agency and the sponsor, and reduce regulatory 
risk for VC investors in novel therapies.
     Regulatory standards that reflect the unique challenges of 
drug development for rare diseases. As discussed above, it is essential 
that FDA apply standards that reflect the realities of drug development 
for rare and neglected diseases. We believe that FDA has statutory 
authority to apply its judgment and discretion in the evaluation of 
novel therapies for rare diseases. What is needed is clear direction 
and leadership from senior FDA officials who recognize these issues, 
leading to the articulation of a regulatory policy that encourages an 
appropriate balancing of benefit and risk in the context of the 
realities of drug development for rare diseases.
     Regulation based on risk classification. The level of 
approval standards should be based on the risk. Higher levels of 
evidence of efficacy and safety would be required for therapies and 
technologies which present greater risk concerns.
     Ensuring Appropriate External Expertise to Support Reviews 
of Novel Therapies. As stated above, the potential for inadequate 
expertise at the Agency and on advisory panels to review and rule upon 
novel products is a real problem because persons who can provide the 
day-to-day input to ensure a knowledgeable, effective and efficient 
review are often excluded from the process due to conflict of interest 
concerns. Although they can participate at selected moments as part of 
the sponsor's team, their value is greatly reduced in that capacity. 
NVCA strongly believes that the advisory committee review process must 
have persons with intimate knowledge of novel therapies if these panels 
are going to properly advise the FDA. Accordingly, we propose that the 
FDA request that its legal counsel determine transparent processes and 
standards to permit persons with an interest in a novel therapy and 
technology to participate in the advisory panel process as an advisor 
or a non-voting panel member with adequate disclosure of any conflicts 
or potential conflicts. If there are ownership interests, functioning 
as a scientific advisor to a panel could be inappropriate. However, if 
there are no financial interests, but the individual does have a 
financial interest, participation as a non-voting panel member may be 
appropriate, again with adequate disclosure of the person's association 
or interest in the device. Medical advisory committees must be able to 
recruit the most qualified experts in the field in order to provide 
meaningful recommendations to the Agency on product approvals. NVCA 
believes that the current conflict of interest policies prevent the 
best academic researchers and physicians and those from industry from 
serving on advisory committees, to the detriment of patients and 
innovation.

                               CONCLUSION

    NVCA believes that these suggestions will stimulate innovation and 
the development of ``novel therapies'' without compromising the safety 
or effectiveness of cleared or approved therapies and will provide the 
appropriate incentives that will lead to the development of critical 
treatments for rare and neglected diseases. NVCA looks forward to 
working with the committee to help accomplish this important goal.

 Response to Questions of Senator Harkin, Senator Enzi, Senator Casey, 
  Senator Hagan, and Senator Franken by the Department of Health and 
              Human Services, Food and Drug Administration

                             SENATOR HARKIN

    Question. Some suggest that FDA should create a separate division 
of rare and neglected diseases within the Center for Drug Evaluation 
and Research to bring the proper expertise to bear on the analysis of 
drug applications intended to treat such maladies. Can you please 
comment on the merits of this idea?
    Answer. FDA shares the goal of encouraging and speeding the 
development of drugs, vaccines, biologic medical products, and 
diagnostic tests for rare and neglected diseases and appreciates 
efforts by Congress to achieve these goals. FDA is aware of proposals 
to establish a specific review group in the Center for Drug Evaluation 
and Research (CDER) for products to treat rare diseases. This approach 
may have some challenges that would be important to carefully consider 
so as to avoid potential unanticipated consequences. For example, rare 
diseases cut across all medical disciplines, from oncology to 
obstetrics to rheumatology to infectious diseases to neurology to 
inborn errors of metabolism, etc. The scientific and practical 
challenges posed by these products require input from our most 
experienced scientists and clinicians. Expertise in particular rare 
diseases, including expertise in defining appropriate endpoints and 
employing flexible clinical trial designs, is currently embedded within 
the medical disciplines that also embrace more common diseases.
    In February 2010, FDA created a position of Associate Director for 
Rare Diseases (ADRD) in CDER. The ADRD coordinates the development of 
policies and procedures for the review and approval of treatments for 
rare diseases throughout CDER, ensures appropriate training of staff, 
establishes consistent processes for providing advice to sponsors, and 
advocates for and oversees the efficient development of products for 
rare diseases across multiple scientific disciplines. The ADRD is 
actively addressing challenges related to rare diseases through 
enhancing coordination and identifying and promoting best practices 
among FDA's experts in the specific disease areas of interest, bringing 
detailed knowledge of flexible approaches to development and review of 
drugs to treat rare diseases. In conjunction with the Office of Orphan 
Products Development (OOPD) and the Office of the Chief Scientist 
(OCS), the ADRD supports collaboration among scientists and clinicians 
throughout FDA, promoting scientific and regulatory innovations to help 
facilitate timely development and approval of new treatments for 
patients with rare diseases.
    Thank you again for your interest in rare and neglected pediatric 
diseases. If you have further questions, please let us know.

                              SENATOR ENZI

    Question 1. Looking at these different programs at different 
agencies, is there any entity that acts as a shepherd for a company or 
product along the entire development process, or does each agency just 
monitor its own program?
    Answer 1. In February 2010, FDA and the National Institutes of 
Health (NIH) established a Joint NIH-FDA Leadership Council to 
spearhead collaborative work on important public health issues. The 
Joint Leadership Council works together to help ensure that regulatory 
considerations form an integral component of biomedical research 
planning, and that the latest science is integrated into the regulatory 
review process. The collaboration will advance the development of new 
products for the treatment, diagnosis, and prevention of common and 
rare diseases and enhance the safety, quality, and efficiency of the 
clinical research and medical product approval enterprise. The 
formation of the Leadership Council represents a commitment on the part 
of both agencies to forge a new partnership and to leverage the 
strengths of each agency toward this common goal.
    In addition to the Leadership Council, FDA collaborates with NIH on 
multiple levels. FDA's Office of Orphan Products Development (OOPD) 
works closely with NIH's Therapeutics for Rare and Neglected Diseases 
(TRND) program and the NIH Office of Rare Disease and Research (ORDR), 
integrating activities across agency boundaries. OOPD acts as an 
ombudsman throughout the drug development process, meeting with 
sponsors from the earliest idea all the way through the drug 
development process. OOPD has a formal role in granting orphan status 
designation and awarding grants and regularly attends review division 
meetings, providing overall regulatory advice to all companies that 
aspire to make new therapies for people with rare diseases.
    FDA's Center for Drug Evaluation and Research (CDER) recently 
established a new position of Associate Director for Rare Diseases 
(ADRD), which is intended to serve as a focal point within CDER for 
communication with rare disease stakeholders, including partner offices 
at NIH. In conjunction with OOPD, the ADRD also supports collaboration 
among scientists and clinicians throughout FDA, promoting scientific 
and regulatory innovations to help facilitate timely development and 
approval of new treatments for patients with rare diseases.
    Finally, FDA's Office of Pediatric Therapeutics (OPT) works closely 
with NIH's Eunice Shriver National Institute of Child Health and Human 
Development to shepherd pediatric products through the development 
pipeline.

    Question 2. I am glad to hear that you are focused on training FDA 
reviewers in the science of conducting and analyzing small clinical 
trials. Is there a corresponding effort to provide regulatory certainty 
via guidance to industry for clinical trial design for these small 
populations?
    Answer 2. FDA is exploring the development of guidance documents 
for rare disease research programs; however, because these trials often 
have unique circumstances, guidance will not answer all of the 
questions that industry may have. For this reason, FDA is working to 
educate industry and other stakeholders about the possibilities for the 
science of conducting and analyzing small clinical trials. The FDA 
annual course entitled, ``The Science of Small Clinical Trials'' was 
originally limited to FDA and NTH participants but was recently opened 
to a wider audience. Last year more than 1,500 registrants 
participated, many of whom were from industry. In addition, FDA and 
NIH, in collaboration with the National Organization for Rare Disorders 
(NORD) and Duke University Medical Center, are co-sponsoring a training 
course for rare disease investigators, scheduled to take place in 
October 2010. The course will focus on special considerations and 
regulatory requirements for research on rare diseases and orphan 
products. FDA plans to repeat this course annually.

    Question 3. Both the orphan drug and Humanitarian Device Exemption 
programs are designed to incentivize developing treatments for rare 
diseases. The population limit for orphan drug designation is 200,000 
people. However, the limit for the Humanitarian Device Exemption is 
4,000 people. Do you believe the difference is appropriate? If so, why?
    Answer 3. These statutory limits were determined by Congress, not 
FDA; however, FDA recognizes that there are reasons why these numerical 
differences may exist. The Humanitarian Use Device/Humanitarian Device 
Exemption (HUD/HDE) program and the Orphan Drug program are vastly 
different in terms of the incentive that they offer. The HUD/HDE 
program offers as its major incentive an exemption from the otherwise 
applicable effectiveness requirements. To qualify for this exemption, 
certain criteria must be met, including a determination by FDA that the 
probable benefit outweighs the risk of injury or illness from use of 
the device. Arguably, one might wish to be especially restrictive of 
the population to which one exposed less well-established therapies. In 
contrast, the Orphan Drug Act offers market exclusivity (and other 
financial rewards) as its major incentive, but maintains the same 
requirements for safety and efficacy as any other drug/biologic.
    While FDA has no position on changing the limit for the 
Humanitarian Device Exemption, the Agency strongly urges Congress to 
ensure that, if a change is made, the population limit is clearly 
defined, not variable. Any variation in the system will lead to 
unnecessary confusion and may unintentionally disincentivize innovation 
in this area.

                             SENATOR CASEY

    Question 1. What sort of data exists on post-marketing surveillance 
for children's use of pharmaceuticals and medical devices?
    Answer 1. FDA's Adverse Event Reporting System is a computerized 
information database designed to monitor new adverse events and 
medication errors that occur in marketed, FDA-regulated products. The 
system includes data on adverse events experienced by children, though 
it is incomplete because reporting of adverse events from the point of 
care is voluntary in the United States. Recognizing the need to improve 
post-marketing surveillance for children's products, Congress enacted 
legislation to address this issue. The Food and Drug Administration 
Amendments Act of 2007, which included the Pediatric Research Equity 
Act, the Best Pharmaceuticals for Children Act, and the Pediatric 
Medical Device Safety and Improvement Act of 2007, requires FDA's 
Pediatric Advisory Committee (PAC) to review all adverse events in the 
year after a product receives new pediatric labeling resulting from 
pediatric studies. Because the legislation increased the number of 
pediatric clinical trials, and subsequently, the number of products 
with pediatric information in labeling, the number of products up for 
pediatric-focused safety review has steadily increased from 
approximately 8 products annually to over 40 products per year. As of 
June 2010, the PAC reviewed 135 products and recommended labeling 
changes on 32 (24 percent) of those products. In addition, the PAC 
recommended additional studies for seven products. These products 
include both pharmaceuticals and medical devices.

    Question 2. Would it be advisable for FDA to better understand the 
frequency and practice of ``off-label'' use in children--particularly 
those with rare diseases? If so, what should be done?
    Answer 2. Off-label use of commercially available drug and 
biological products is a concern for both pediatric and adult rare-
disease populations. Products that are approved for other indications 
are frequently prescribed off-label for rare diseases, usually in 
situations where no other specific treatment for the rare disease is 
available. The frequency of off-label prescribing in rare diseases has 
not been quantified, though we are aware of the practice through 
communication with patient groups and treating physicians. We recognize 
that in some cases limiting off-label use would leave patients with 
few, or no, treatment options. The best approach for patients would be 
to study these products--in children and adults--in the conditions for 
which they are being used in order to adequately inform patients and 
physicians of their safety and effectiveness. FDA is currently working 
to encourage such studies through the work of its OOPD, OPT, and the 
Associate Director for Rare Diseases in CDER.

                             SENATOR HAGAN

    Question. One challenge that many of the witnesses today spoke of 
is the need to incentivize the device and drug/biotech industry to 
develop therapeutics for rare, pediatric diseases. Assuming a device or 
compound gets to the clinical trial stage, how long does it take to 
conduct the adult trials and then the follow-on clinical trials in 
children? Is there a way to speed up this process?
    Answer. The time required to conduct clinical trials in adults and 
children varies greatly as the Agency must review and evaluate each 
device or compound on a case-by-case basis. Although pediatric trials 
are usually smaller in size and for some studies, such as 
pharmacokinetics, can be completed fairly quickly (weeks), the smaller 
number of children with the disease may result in prolonged enrollment 
periods.
    There are many factors that contribute to the length of the trial. 
The condition being studied and the proposed effect of the intervention 
on the disease (i.e., endpoints and outcome measures) will be major 
determinants for the length of the trial, and will vary considerably 
depending on disease, treatment and outcome. Additional considerations 
specific to clinical trials conducted in children include the 
prevalence of the disease in children, ineligibility to volunteer to 
participate in trials, and the fact that trials should not be conducted 
in children without the condition are important factors that impact the 
availability of children for trials and thus the length of the trial. 
Other factors, such as the need or specialized equipment, variable 
treatment affect, issues related to individual growth and development, 
specialists/nurses, labs, and pediatric-friendly facilities, directly 
contribute to the complexity and technical difficulties of pediatric 
trials.
    One approach that does facilitate the conduct of pediatric trials 
is the ability to extrapolate efficacy when the course of the disease 
and the response to therapy are thought to be ``sufficiently similar'' 
in adults and older children. In some cases, the ability to extrapolate 
could eliminate the need to replicate efficacy trials, shaving years 
off the development process. We also encourage companies to interact 
with the Agency in the early stages of product development to identify 
a potential use of the product in a pediatric population. Early 
dialogue with the Agency may allow the company to obtain approval for 
pediatrics close to or concurrent with the adult approval. This is 
particularly true when there are limited or no other therapeutic 
options and the condition is serious or life-threatening. One should 
note, however, when the product is novel or a new molecular entity with 
little or no adult experience, it is considered prudent to wait until a 
more robust understanding of its effectiveness and safety has been 
established before enrolling a population that is as vulnerable and 
variable as the pediatric population.

                            SENATOR FRANKEN

    Question 1. A key stipulation for a humanitarian device exemption 
is that ``the probable benefit to health from using the device 
outweighs the risk of injury or illness from its use.'' How exactly 
does FDA determine what constitutes ``probable benefit to health?'' 
Would FDA be willing to offer guidance on this topic so device 
companies can more easily navigate the humanitarian device exemption 
process?
    Answer 1. The Federal Food, Drug and Cosmetic Act requires that 
applicants for Humanitarian Use Device (HUD) designation provide an 
explanation of how the probable benefit to health from the use of the 
device outweighs the risk of injury or illness from its use, taking 
into account the probable risks and benefits of currently available 
devices or alternative forms of treatment. This requirement allows FDA 
to examine applications on a case-by-case basis, taking into account 
the specific circumstances related to the device and its use. We 
recognize the challenge that the terminology presents and appreciate 
the desire for guidance on this topic, and we will he considering that 
in determining future guidance to make this issue clearer.

    Question 2. We've heard stories of pediatric patients in Minnesota 
who are unable to get the humanitarian use devices they need because 
insurance companies consider these devices to be ``investigational.'' 
Does FDA consider these devices to be investigational?
    Answer 2. FDA considers a device that has been approved as a HUD to 
be an approved device. FDA's role is to make decisions about safety and 
effectiveness, not coverage and payment; however, we view our recent 
agreement to establish a memorandum of understanding with the Centers 
for Medicare and Medicaid Services (CMS) entitled ``Parallel Review of 
Medical Products by the FDA and CMS Agencies'' as an opportunity to 
better share information with our sister Agency about HUDs and other 
approved products in the future.
    FDA staff handle many inquiries from private payers on this issue. 
We work directly with the payers to help them understand that an HDE is 
an approved product and is not under investigation. We also work with 
payers on individual cases to help secure coverage for individual 
patients. FDA staff regularly conduct outreach to help the health care 
industry and those who make payment decisions understand the status of 
HDEs and issue guidance in which it was made clear that an HDE is an 
approved product. Recently, FDA issued an updated HDE guidance that 
provides additional information and clarity to interested parties.

 Response To Questions of Senator Enzi, Senator Brown, Senator Casey, 
             and Senator Hagan by Alan E. Guttmacher, M.D.

                              SENATOR ENZI

    Question 1. What strategy has the NIH established to ensure the 
TRNDs program is successful?
    Answer 1. The Therapeutics for Rare and Neglected Diseases program 
(TRND) is explicitly intended to tackle a phase within drug development 
well-known to be fraught with failure and unpredictability; hence its 
moniker in the biopharmaceutical industry as the ``Valley of Death.'' 
To ensure that the program is successful, NIH has established a number 
of strategies to achieve TRND's twin goals of: (1) producing drugs for 
rare and neglected diseases ready for clinical research testing; and 
(2) developing new paradigms and technologies that will increase 
success and decrease costs in this extremely challenging arena. Many 
programmatic features integral to TRND are unique and made possible 
because TRND is being conducted through NIH. Such features include:

     Establishing a project selection and ongoing review 
process that utilizes world experts in drug development from the 
academic, biotechnology, pharmaceutical, venture capital, and 
foundation sectors;
     Establishing a diversified portfolio within the drug 
development pipeline that includes projects at various stages and with 
various degrees of difficulty;
     Selecting projects (after a rigorous review process) on 
the basis of scientific opportunity and medical need rather than 
anticipated financial return;
     Choosing projects potentially applicable to multiple 
diseases, thus increasing the utility of each drug developed;
     Hiring the best talent from the biopharmaceutical industry 
to support in-house activities in addition to convening consulting 
scientists from all sectors to develop the best strategies for 
individual projects;
     Focusing activities on technology, paradigm, and systems 
engineering development to continuously increase efficiency of 
processes within the drug development pathway.

    Question 2. How could increasing funding for the Common Fund help 
support research for rare and neglected diseases?
    Answer 2. Many rare and neglected diseases are multisystem 
diseases; that is, they involve multiple organ systems and parts of the 
body. Thus, full understanding of their underlying biology and the 
development of effective therapeutic and preventive strategies often 
require the expertise and perspectives of many NIH Institutes and 
Centers and their communities of researchers. The NIH Common Fund 
supports programs that require just such multi-Institute expertise and 
that go from the most basic science to translational and clinical 
research. Supporting the fiscal year 2011 Budget request for the Common 
Fund would therefore support rare and neglected diseases in several 
ways.
    For example, the new Common Fund program entitled Knock-Out Mouse 
Program Phenotyping (KOMP2) seeks to build upon an existing resource of 
mouse mutant strains to determine their physiological characteristics 
(phenotypes). These mutant strains are intended to provide animal 
models of genetic disorders, and they therefore provide basic science 
tools to understand rare disease etiology as well as translational 
tools to study potential therapeutic approaches.
    The Interdisciplinary Research Program provides funds for teams to 
develop comprehensive approaches to complex health problems, including 
provision of core facilities, research projects, and interdisciplinary 
training programs focused on the health problem. One consortium funded 
through this program addresses Fragile X-Associated Tremor/Ataxia 
Syndrome. It focuses on the critical periods of development when 
mutations are most problematic, seeking to identify the molecular 
targets where therapies might be most effective and to determine 
mechanisms of cognitive dysfunction in the disease.
    The Human Microbiome Program is designed to identify and 
characterize all the microbes that live on and in us, and to determine 
their contribution to health and disease. Current projects funded 
through this program address the role that microbes play in maintenance 
of health and in development of a variety of disorders.
    Neglected diseases in Africa are an emphasis area for the Human 
Heredity and Health in Africa Program, a new program to be launched in 
the Common Fund this year. In conjunction with the Medical Education 
Partnership Initiative which is also funded via the Common Fund, this 
program provides support to develop research capacity in Africa so that 
neglected diseases can be studied in the areas where they are most 
common. The funds currently planned through the Common Fund are 
intended to facilitate the study of genetic and environmental traits 
that underlie differential susceptibility to such diseases.

    Question 3. How many therapies or research projects will the Agency 
be able to conduct and complete with $24 million? On average, how much 
is necessary to successfully develop a candidate compound that is ready 
to be tested in patients and licensed to the private sector?
    Answer 3. While the cost of developing a project from a ``lead'' 
stage through an Investigational New Drug (IND) application or a proof-
of-concept study in humans varies widely, the industry standard for 
entirely novel targets and diseases (those TRND will work on) is 
approximately $10 million over 2 to 5 years. Even with this substantive 
financial investment, industry-standard success rates for candidate 
drugs targeting diseases of this sort are approximately 1 in 10. 
Therefore, with the current budget of $24 million, TRND is initiating 
five pilot projects that enter the 2- to 3-year preclinical development 
process at various points; those entering later in the process cost 
less. Through the pilot projects, TRND is building infrastructure 
necessary to support these and future projects, while also working on 
several small-scale technology development projects, since each of 
these areas will be critical to TRND's long-term success. With over 
6,000 rare and neglected diseases at the heart of its mission, TRND 
cannot, and will not, simply adopt current industry best practices, 
because their cost and failure rates are just too high. Technology 
development--the science of preclinical drug development--is critical 
to TRND's long-term impact, both for the diseases it works on, and for 
the drug development enterprise generally. In fiscal year 2011, TRND 
expects to launch an additional three to five projects.

    Question 4. Can you provide an overview of the Bench-to-Bedside 
Program? How much funding does the program provide for research focused 
on rare and neglected diseases?
    Answer 4. The Bench-to-Bedside Program was established in 1999 to 
integrate the work of basic and clinical scientists on the NIH campus, 
aimed at creating collaborations based on high quality science that has 
the strong potential to result in new understanding of a disease 
process or lead to new therapeutic interventions. The program expanded 
in 2006 to encourage partnerships between intramural and extramural 
programs. Grants are funded for 2 years of up to $135,000 per year. In 
recent years, the Office of Rare Diseases Research (ORDR) has set aside 
up to $1 million annually, with matching co-funding from one or more 
NIH Institutes. In 2010, ORDR provided $931,412 for 12 projects, six of 
which were in their second year. The ORDR contribution was matched by 
10 Institutes thereby raising the total for rare diseases to almost $2 
million annually. To date, about 600 primary and associate 
investigators have collaborated on nearly 200 funded projects with 
approximately $40 million distributed in total bench-to-bedside 
funding.

    Question 5. How much funding does the Agency spend on rare and 
neglected diseases? How does that compare to the Agency's overall 
budget? What percent of funds targeted for rare and neglected diseases 
are spent on rare and neglected cancers?
    Answer 5. Since the NIH has not collected information on rare and 
neglected diseases as a single category, there are many specific rare 
diseases for which total NIH investment cannot currently be reported, 
but which are supported by and tracked by individual NIH Institutes and 
Centers. For example, the National Cancer Institute reports spending 
$192.8 million on childhood cancer research in fiscal year 2009.
    Currently, the NIH does not collect information on funding for rare 
and neglected diseases research per se. However, three major programs 
in recent history have greatly increased NIH's focus on rare diseases 
diagnoses and treatments. In 2003, the Office of Rare Diseases Research 
(ORDR) partnered with several NIH Institutes and Centers to fund the 
Rare Diseases Clinical Research Network (RDCRN). In 2008, at the 
conclusion of the first 5-year funding cycle of 10 consortia, the ORDR, 
in collaboration with NIH Institutes funded 19 consortia. For the 10-
year duration of the RDCRN, NIH has committed almost $200 million.
    In addition, the NIH has committed $24 million annually for fiscal 
year 2009 and fiscal year 2010 to the Therapeutics for Rare and 
Neglected Diseases (TRND), a new collaborative drug discovery and 
development program. The fiscal year 2011 Budget requests $50 million 
to expand TRND activities.
    The Undiagnosed Diseases Program (UDP) is another effort that 
focuses by its very nature on rare diseases. Using a unique combination 
of scientific and medical expertise and resources at the NIH, the UDP 
provides answers to patients with mysterious conditions that have long 
eluded diagnosis. The fiscal year 2011 Budget includes $3.5 million for 
this effort.

    Question 6. Specifically, how is the Agency working with the FDA 
and industry to develop a more seamless process in drug development?
    Answer 6. Historically, the NIH and the FDA have established 
collaborations largely according to scientific disciplines in order to 
address specific research areas and needs. In February 2010, the two 
agencies announced an unprecedented effort to work together to help 
ensure that regulatory considerations form an integral component of 
biomedical research planning and that the latest science is integrated 
into the regulatory review process. A joint NIH-FDA Leadership Council 
(LC), composed of the NIH Director and FDA Commissioner and senior 
leadership from each agency, was formed. The collaboration will advance 
the development of new products for the treatment, diagnosis and 
prevention of common and rare diseases and enhance the safety, quality, 
and efficiency of the clinical research and medical product approval 
enterprise. The formation of the Leadership Council represents a 
commitment on the part of both agencies to forge a new partnership and 
to leverage the strengths of each agency toward this common goal.
    In addition, at the program level, the recently launched 
Therapeutics for Rare and Neglected Diseases (TRND) program within the 
NIH Intramural Research Program has established monthly working group 
meetings with representatives from the FDA Office of New Drugs and its 
Office of Translational Science. The aim of these meetings is to focus 
on conceptual issues presented through TRND projects and develop 
potential ideas to address any roadblocks identified in the drug 
development process. Furthermore, TRND leadership is working closely 
with the FDA Office of Orphan Product Development to coordinate 
activities and leverage existing programs to advance mutual goals.
    The NIH Office of Technology Transfer serves as one of the NIH's 
primary interfaces with both industry and academia in pursuing common 
research goals. Government scientists can leverage their own research 
resources to facilitate the development and commercialization of health 
care pharmaceuticals and products, while private companies can leverage 
their own research efforts while collaborating in cutting edge NIH 
research. One of the primary tools is a Cooperative Research and 
Development Agreement (CRADA), which can make government facilities, 
intellectual property and expertise available for collaborative 
interactions to turn scientific knowledge into useful, marketable 
products through licensing agreements. For products that may be used to 
treat rare conditions, this arrangement can prove especially useful by 
allowing the NIH to support the initial research on a drug or device 
(often the riskiest and most time-consuming part of the process), and 
then turning it over to a private company for final testing, FDA 
approval, and marketing.

    Question 7. What types of research do you support to assist FDA in 
establishing guidance to further clarify the requirements for drug 
approval?
    Answer 7. In February, 2010, the NIH released a new Request for 
Applications (RFA), jointly funded with the FDA, titled Advancing 
Regulatory Science Through Novel Research Technologies. The purpose of 
this funding opportunity is to foster the development, evaluation and 
availability of new or improved tools, methods, standards, and applied 
science that support a better understanding and improved evaluation of 
product safety, quality, effectiveness, and manufacturing throughout 
the product lifecycle. The science may range from nanotechnology to the 
development of novel experimental models, such as a biological system 
on a chip for assessing safety and toxicity, to innovative research on 
clinical trial design. By the end of fiscal year 2010, NIH expects to 
be supporting several novel cooperative grants in cross-cutting areas 
of science.
    Research results from investigator-initiated basic and clinical 
research supported across the NIH inform and clarify requirements for 
drug and device development. Much of this research is focused on 
individual diseases and conditions; however, the characterization and 
standardization of new and emerging technologies, such as stem cells, 
genomics and related technologies, and nanotechnology, is cross-cutting 
and serves all research communities and the FDA in establishing 
guidance and requirements for development and subsequent approval. For 
instance, the NIH funds both intramural and extramural research 
directed toward the examination of the fundamental principles of 
nanotechnology and their application to the development of diagnostics 
and interventions. This research augments existing knowledge and helps 
to assess what data are still needed to approve specific drugs and 
medical devices. Another cross-cutting type of research is in the area 
of clinical trial design. As clinical trials are becoming more complex, 
and trials are being conducted in sometimes small sample populations, 
investigators are looking to adaptive design methodologies. The NIH 
supports biostatistical research projects through a variety of grant-
related mechanisms that informs study design and analyses.

    Question 8. Can you provide a specific example of NIH funded 
research associated with FDA guidance or overall improvements in the 
drug review process?
    Answer 8. The NIH and the FDA traditionally have established 
collaborations largely according to scientific discipline in order to 
address specific research areas and needs. One example of an 
intramural-funded collaborative effort that resulted in a guidance 
document and associated improvements in the drug development process 
can be found in the FDA/NCI Interagency Oncology Task Force (IOTF). The 
IOTF was formed in 2003 as an interagency effort to enhance the 
efficiency of clinical research and the scientific evaluation of new 
cancer medications. Through it, the two agencies share knowledge and 
resources to facilitate the development of new cancer drugs and speed 
delivery to patients. As a direct outcome of the collaborative effort, 
in January 2006 the FDA released its Guidance for Industry, 
Investigators, and Reviewers on Exploratory Investigational New Drug 
(IND) Studies. Exploratory IND studies enable a sponsor to proceed more 
efficiently with the development of promising candidates by allowing a 
new drug candidate to provide clinical information at a much earlier 
phase of drug development. The guidance document addressed what 
preclinical and clinical approaches, including chemistry, 
manufacturing, and controls information, should be considered when 
planning exploratory studies in humans. This tool enables a faster, 
more cost-effective path to early clinical development.
    The Patient Reported Outcomes Measurement Information System 
Program (PROMIS), an extramural project funded through the NIH Common 
Fund, is designed to develop a precise, efficient and valid assessment 
of patient outcomes, such as fatigue, that are the result of disease or 
treatment. The NIH is working with the FDA in this program to ensure 
that the work done with the system takes into account FDA guidance and 
perspectives for the assessment of efficacy and safety of new drugs/
treatments. This is critical for the many diseases/conditions where 
patient reports are a primary assessment of improvement, including pain 
and depression.

    Question 9. Can you elaborate on why the Human Genome Project and 
why genetic research in general is so important for rare and neglected 
diseases?
    Answer 9. Fundamentally, approximately 80 percent of rare diseases 
are genetic diseases--that is, they are caused by the malfunction of 
one or more specific genes. For this reason, the Human Genome Project 
has been enormously beneficial to the rare disease community; the 
genetic causes of over 2,000 different rare diseases are now known. 
While knowledge of the genes involved in a disease is critical 
information to developing targeted drugs, it is just the start. Many 
diseases whose genetic cause(s) have long been known are still without 
sufficiently effective treatment (e.g., Huntington's disease and sickle 
cell disease). This difficult reality is why the TRND program is so 
critical.

    Question 10. I understand the Agency has been working to provide 
basic tools to researchers that were previously not available to reduce 
barriers for investigators. Can you provide an example of a specific 
tool and academic institution or other type of research entity that 
benefited from the tools? Who has access to these tools? Are the tools 
only accessible to NIH grantees or all public and private research 
institutions?
    Answer 10. The NIH provides basic research tools, including genome 
sequences, gene libraries, knockout mice, and informatics databases of 
various kinds, to researchers from all sectors without restriction. For 
example, the National Centers for Biomedical Computing program develops 
informatics tools for a wide variety of research areas and makes them 
publicly available. Among the newest types of tools to be made 
available are small molecule tools, which are ``drug-like'' chemicals 
that can be used to study diseases in cell and animal models. NIH began 
a large-scale program to produce small molecule research tools, and 
data on them, in 2003 with the launch of the Molecular Libraries 
Program, as part of the original NIH Roadmap. That program has been 
enormously successful and has produced hundreds of compounds to study 
genes, pathways, and cells in collaboration with researchers throughout 
the country and the world. These tool (or ``probe'') compounds are 
readily available to any researcher (over 300 investigators have used 
the Molecular Libraries resources to date), irrespective of whether the 
researcher is an NIH grantee or works within the public or private 
sectors. Detailed reports on the research (and tools) are made publicly 
available through the NIH Web site, and all the data generated are made 
publicly available via the NIH PubChem database, which enables 
investigators to see the chemical structures of all compounds that have 
been shown to be active in various assays (tests).
    One example of the success possible through the access to these 
tools is a new compound for studying the cause and treatment of 
schistosomiasis, a parasitic disease highly prevalent (affecting more 
than 250 million people) in Africa and South America. The NIH Chemical 
Genomics Center (NCGC), part of the Molecular Libraries Program, 
collaborated with Dr. David Williams at Rush University in Chicago, an 
NIH grantee and expert in schistosomiasis, to produce new tool 
compounds and then prove that the enzyme inhibited by a particular tool 
compound was required for the parasite to live. The tool compound very 
effectively kills schistosomiasis worms both in cultures and in mice, 
and the work was published in major scientific journals. This work is 
also an example of the catalytic effect these kinds of tools can have, 
because as a result of the publications, a different researcher--Dr. 
Michael Cappello at Yale University--contacted Dr. Williams and NCGC, 
who provided Dr. Cappello with the tool compound. Dr. Cappello then 
showed that the compound is also very effective at treating a 
completely different parasitic infection, hookworm. Dr. Williams, Dr. 
Cappello, and the NCGC scientists are now working together to develop 
these compounds further, so that they can be tested in humans with 
these devastating diseases.

                             SENATOR BROWN

    Question 1. As was discussed in depth at the HELP committee's 
hearing, rare pediatric diseases pose a number of challenges. One 
barrier is that the number of patients available for clinical trials is 
small. As such, the need for sharing and collaboration is all the more 
critical for rare pediatric diseases. I have been working with Senator 
Bond to advance legislation--the Pediatric Research Consortia 
Establishment Act--that envisions a networked consortium of leading 
pediatric biomedical research entities that would be competitively 
selected by NIH. By operating in such a model, the project would foster 
resource sharing, collaboration, and help pool patients to ultimately 
develop treatments and therapies for diseases and disorders of both 
childhood and adulthood. What are your thoughts on the challenges 
associated with pediatric research and the ability to use a networked 
consortia approach to overcome these issues and permit a more robust 
pediatric biomedical research enterprise? I'd like to ask that NICHD 
provide a full written assessment as to the merits of this proposal.
    Answer 1. In fiscal year 2009, the NIH, through 22 Institutes and 
Centers (ICs), awarded approximately $3.4 billion, including funds from 
the American Recovery and Reinvestment Act, in support of pediatric 
research activities across the country. This funding was distributed to 
the research community through the full range of available funding 
mechanisms, including investigator-initiated grants, contracts, and 
research networks. This flexibility allows the extensive scientific 
expertise at the NIH and across the extramural scientific research 
community to judge which mechanism(s) might be best suited for the 
specific research needed to answer questions about children's health 
and development and pediatric diseases and conditions. Less commonly, 
but where the scientific challenge warrants and funding permits, NIH 
ICs (often in trans-Institute collaboration) have created 
multidisciplinary centers of excellence or research networks for 
specific pediatric populations, specialties, or conditions, such as 
autism, pediatric oncology, neonatology, and adolescents with HIV/AIDS, 
to name a few.
    For example, the NIH Office of Rare Diseases was directed by 
Congress in the Rare Disease Act of 2002 (P.L.107-280) to establish a 
clinical research network focusing on rare and neglected conditions. 
Since 2003, the Rare Disease Collaborative Research Centers network of 
investigators and patient groups, in partnership with technology 
leaders, has been working to develop biomarkers and new approaches to 
diagnosis, prevention, and treatment, provide content for a web-based 
resource site about rare diseases, and train new clinical investigators 
in rare disease research. Of the 19 current member sites of the 
network, three are focused on pediatric rare diseases. These three main 
sites and their 33 affiliate sites (many located at children's 
hospitals) are managed by the Eunice Kennedy Shriver National Institute 
of Child Health and Human Development (NICHD) on behalf of the NIH.
    In addition, a number of the Clinical and Translational Science 
Awards (CTSAs) sites include a strong emphasis on creating 
infrastructure to conduct pediatric clinical trials, which will allow 
pediatric researchers who focus on a wide variety of conditions to 
utilize this new resource and to conduct clinical trials efficiently 
and effectively.
    The NIH may provide only technical assistance on legislative 
proposals on which the Administration has not yet taken a position. 
However, in evaluating what mechanism or infrastructure to use to 
address any question about health or disease, important considerations 
include whether the proposed mechanism provides the range of scientific 
expertise required to answer that question, the availability of a 
sufficiently sized study population, and whether a currently existing 
mechanism might adequately meet these needs. The impact of creating a 
new infrastructure on investigator-initiated proposals also must be 
weighed.

                             SENATOR CASEY

    Question 1. How is our emerging knowledge of genetics helping us 
understand rare childhood diseases--and bring new cures and treatments 
to children faster?
    Answer 1. Since approximately 80 percent of known rare diseases, a 
substantial proportion of which occur in children, are thought to have 
a genetic basis, increasing understanding of the role of genetics in 
rare diseases will unquestionably have a considerable impact on their 
diagnosis, prevention, and treatment. However, a few decades ago, many 
scientists assumed that once causative genes were identified, 
treatments would be imminent, an assumption that has proven overly 
optimistic. Rare diseases are very complex and often affect multiple 
organ systems, and phenotypic (physiological characteristics) 
expressions of these genes in individuals can be quite diverse. 
Nevertheless, by continuing to increase the knowledge base about the 
origins of pediatric diseases, and the impact of those diseases over a 
lifespan, targeted treatments can be developed that can reduce 
morbidity and mortality, and improve the quality of life of children 
and their families.

    Question 2. Have we made appropriate public investments in 
understanding rare childhood diseases?
    Answer 2. The NIH spends a substantial amount on research on 
various rare diseases, including those affecting children, but with 
over 6,000 known rare diseases, not every one has been fully addressed. 
Different types of research also are required, including basic, 
translational, clinical and natural history studies, which are 
essential to understanding the expression of a genetic illness. With 
the Rare Diseases Clinical Research Network, the NIH has developed a 
model to help move this research forward.

                             SENATOR HAGAN

    Question 1. In your testimony, you mention there are now 29 
conditions that States screen newborns for. How many of these are rare 
diseases? Is there any effort underway to expand the number of diseases 
we screen for? Why or why not?
    Answer 1. Newborn screening has the potential to prevent or 
ameliorate many serious heritable conditions. The HHS Secretary's 
Advisory Committee on Heritable Disorders and Genetic Diseases in 
Newborns and Children is responsible for assessing the scientific 
evidence on potential conditions eligible for newborn screening and 
making recommendations to the Secretary about the addition of such 
tests to the 29 (all considered rare by definition) already on the 
screening panel that most States have adopted. The committee recently 
recommended the addition of Severe Combined Immune Deficiency (SCID), a 
rare condition, and the recommendation was accepted by Secretary 
Sebelius. Currently under consideration by the committee are severe 
critical heart disease and hyperbilirubinemia.
    The NIH has supported research for many years that has produced the 
evidence necessary to determine the efficacy of screening. One of the 
early successes occurred in the 1960s, when NIH-supported researchers 
discovered techniques for detecting phenylketonuria (PKU), a metabolic 
disorder that was a primary cause of intellectual and developmental 
disabilities. PKU, which could be readily treated with dietary therapy 
(medical foods), was the first disorder for which newborn screening 
became mandatory. While not all diseases detectable through newborn 
screening are as manageable, detecting disabling and potentially fatal 
conditions provides an opportunity for critical early treatment, often 
before an infant shows symptoms of a condition, having a profound 
impact on how severe the condition becomes, and improving the quality 
of life, usually dramatically, for affected individuals.
    In early 2008, the Newborn Screening Saves Lives Act was signed 
into law, providing direction to the Secretary's Advisory Committee on 
its work, and establishing the Hunter Kelly Research Program within the 
Eunice Kennedy Shriver National Institute of Child Health and Human 
Development (NICHD). The new law directs the NICHD to support research 
to identify, develop, and test promising new screening technologies, 
which will lead to the expansion of conditions for which newborn 
screening can be done. Along with other Institutes at the NIH, the 
NICHD is currently supporting research in newborn screening for spinal 
muscular atrophy, Fragile X syndrome, Krabbe disease, and other 
conditions.

    Question 2. In your testimony, you discuss spinal muscular 
atrophy--a terrible disease that is the leading genetic killer of 
infants. I met with a family in North Carolina whose 18-month old 
daughter was diagnosed with SMA a few months after birth. While she is 
progressing like a normal toddler in many ways, she is now confined to 
a wheelchair and can no longer sit or roll over on her own. I 
understand that NIH through the National Institute of Neurological 
Disorders and Stroke (NINDS) has some promising treatments for SMA in 
the pipeline. Industry working with advocacy groups has also been 
interested in developing therapeutics.
    Answer 2. Because the failure rate at each stage of therapy 
development is very high for all diseases, the NIH is pursuing multiple 
avenues to prime the therapy development pipeline for treatments for 
spinal muscular atrophy (SMA). In 2003, the NINDS recognized that 
advances in understanding SMA had unlocked the possibility of 
rationally developing treatments, and the Institute chose SMA as the 
disease on which to test an aggressive new approach to expedite 
preclinical therapy development. The SMA Project developed a detailed 
drug development plan with the guidance of a steering committee that 
included expertise in drug development from academia, industry, and the 
FDA. The Project is implementing the plan through a ``virtual Pharma'' 
organization that engages the expertise and resources to carry out 
industry-style drug development via contracts. This allows rapid 
response to opportunities as results emerge. The SMA Project is making 
encouraging progress, with two patents applied for on new compounds 
that show promise against SMA in laboratory models. Advanced 
preclinical safety testing of the most promising compounds is underway 
with the goal of beginning clinical trials in 2011, and the Project is 
also continuing to develop other drug candidates.
    The SMA Project is being supported in addition to, rather than 
instead of, other therapy development efforts. The NIH supports several 
other preclinical therapy development projects for SMA through 
investigator-initiated research programs and through SMA-targeted 
solicitations. Ongoing projects at the NINDS and the NICHD include 
research on gene therapy, stem cells, and drug development. This area 
of research received a substantial boost from American Recovery and 
Reinvestment Act (ARRA) funds. ARRA-funded projects include Grand 
Opportunity (GO) and Challenge grants on gene therapy and on induced 
pluripotent stem cells (a type of stem cell derived from adult cells), 
as well as research on small-molecule drugs. Industry and patient 
voluntary organizations also are interested in working with the NIH on 
therapeutics development for SMA. The NIH is supporting substantial 
academic-industry collaboration on SMA through an NINDS milestone-
driven therapy development program, and the NIH is convening a meeting 
in the fall of 2010 that will bring together the various public and 
private groups to discuss SMA therapy development.

    Question 3. However, I understand that one of the main obstacles 
going forward is identifying a sufficient number of children to 
participate in the clinical trial. Can you comment on the Agency's 
plans to support the implementation of clinical trials for SMA?
    Answer 3. Because therapies for SMA and for several other rare 
neurological diseases may be ready for clinical testing in the next few 
years, it is important that the NIH be prepared to conduct clinical 
trials. Thoughtful selection of the best candidate therapies for 
testing is one essential aspect of conducting trials for rare 
disorders, and multi-site clinical networks are another important 
answer to the need for rapidly recruiting sufficient numbers of 
patients. Rather than developing separate clinical networks for each 
disease, the NINDS is developing a clinical network that will serve SMA 
and other neurological diseases. The program will be open to the best 
candidate therapies, regardless of whether they arise from NIH programs 
or other sources. For many reasons, this combined network will be not 
only more cost efficient but also more effective for SMA and other 
diseases. For example, this network will offer expertise in a range of 
disciplines, including pediatrics, and provide a breadth of experience 
in running clinical trials that will help inform the SMA clinical 
research field.

    Question 4. Could you also comment on whether SMA could be a 
candidate for newborn screening? It seems to me that that might help 
identify patients to participate in clinical trials and accelerate 
approval of a therapeutic.
    Answer 4. The NICHD is currently funding research to pilot test 
newborn screening for SMA. While there is no available treatment for 
SMA (usually a prerequisite for a Secretary's Advisory Committee 
recommendation to add to the newborn screening panel), the NICHD also 
is supporting research on potential treatments. As mentioned in an 
earlier response above, the NICHD (as well as the NINDS, as described 
in the previous response) is cosponsoring an important scientific 
conference in October 2010, entitled ``NIH Therapy Development 
Conference in SMA.'' The main purpose of this meeting is to review and 
address the needs of the research field and the scientific 
opportunities for moving forward on the development of SMA 
therapeutics.

      Response to Questions of Senator Enzi by Alexander J. Silver

    Question 1. Do you think that Congress should fund research at the 
NIH by specifically providing funds for each disease, or do you think 
Congress should provide funds categorized broadly for different types 
of research and allow the Agency to allocate those funds based on 
research grants that have scientific merit?
    Answer 1. I do not believe that Congress should mandate specific 
disease research at the NIH. The NIH needs to maintain ultimate 
decisionmaking in determining whether research is of high enough 
quality to fund. However, given Congress' close relationship with the 
American public, it can and should play a pivotal role in promoting 
treatments and cures in a timely manner for the devastating diseases 
that inflict its constituents. Citizens can advocate for themselves but 
also rely on those they elect to do so when needed, especially when 
simply caring for a loved one who has a disease consumes all aspects of 
life such as Epidermolysis Bullosa (``EB''). For example, when rare 
disease research funding composes just a fractional piece of NIH 
funding--according to figures provided by the NIH, it provided $118 
million in research funds for orphan diseases out of its $30 billion 
budget in 2009 or 0.3 percent--even though approximately 10 percent of 
the American population suffers from rare diseases, Congress can 
highlight this discrepancy and suggest that it be examined. 
Furthermore, when private market incentives are not adequate to attract 
funding to advance rare disease treatments and cures, Congress should 
simultaneously design the correct incentives as well as use all current 
tools possible to encourage rare disease treatment and cure 
development. In the case of children with EB, parent advocacy coupled 
with congressional leadership can lead to a cure.
    Another important factor to consider when allocating resources to 
fund EB or other orphan disease research is that many medical 
breakthroughs impacting a larger group of Americans start with rare 
disease research. As I wrote in my testimony, Remicade--which was 
developed for the treatment of Crohn's disease, a population of 500,000 
people--has been found to effectively treat Rheumatoid Arthritis and 
forms of Psoriasis, a population of over 5 million people. Rituxan, 
developed for non-Hodgkin's lymphoma--a group of 70,000 people per year 
now helps the 1.3 million Americans who suffer from Rheumatoid 
Arthritis.
    Most recently, the University of Minnesota released the results of 
its current stem cell trial for EB; specifically, the procedure 
involves transplanting the bone marrow from a donor who can make the 
protein needed to adhere the layers of skin together to an individual 
who has EB and lacks this protein. The initial results are extremely 
promising. Importantly, this is the first time stem cells have been 
used to repair skin. The wider implications are potentially enormous--
this could help Americans with burns, diabetic ulcers, wounds or 
practically any other skin disorder. Congress can make sure that the 
allocation of resources takes both the immediate and bigger pictures 
into account. Helping a child with EB also will help other Americans.
    While the NIH must maintain autonomy, Congress also must play a 
pivotal role in the conversation about the allocation of publicly 
funded research resources. If not, telling a child with EB that he or 
she needs to wait until we have the perfect incentives in place to help 
him or her is equivalent to a death sentence in many cases.

    Question 2. What types of treatments are currently available for 
your son? How many of them are just to alleviate symptoms?
    Answer 2. Currently, the only treatments available, if any, to 
those who have EB address the symptoms as they occur. When Jackson, our 
son, falls and tears the skin off his palms, we can wrap them with 
bandages and hold him through the pain. When the skin in his throat 
sheers off from eating, we have to wait days until he starts to drink 
and eat again. When Jackson's knee blisters and fills with blood, we 
can only lance it with a large needle and painfully compress the blood 
out of the wound. When an EB child's fingers and toes fuse, their 
parents are powerless to stop their child's lifelong physical deformity 
and pain. Children who suffer from EB live in daily agony as their 
bodies disintegrate.
    There are no approved treatments available that prevent injury or 
systematically cure EB. However, researchers know exactly what causes 
EB and have extremely encouraging knowledge of how to fix it. The key 
factors hindering this dream from becoming reality are sufficient 
funding and a streamlined approval process.
    As an example of a cure's proximity to becoming a reality, I have 
attached the recently published study in New England Journal of 
Medicine, a review of the study\1\ and the lead article from CNN on 
August 12, 2010 about the stem cell bone marrow transplant study for 
children with EB ongoing at the University of Minnesota. As you can 
see, the results suggest a cure is within reach. There are more 
questions to answer and to do so one needs to conduct more trials. In 
order to conduct more trials, one needs more funding. Even with 
additional funding, an improved approval process that balances the 
safety of treatments and the devastation of EB is necessary to ensure 
children are helped before it is too late. In addition to stem cell 
therapies, as discussed in my written testimony, protein replacement 
and gene therapies are close to the clinical trial stage but again lack 
adequate funding and approval in a timely manner. The unifying theme 
among all treatments and cures is that they currently only help to cope 
with EB's superficial symptoms but it does not have to be this way. 
Viable treatments and cures are just a few inches from our fingertips 
with the proper support.
---------------------------------------------------------------------------
    \1\ The review of the study referred to may be found at 
www.nejm.org/doi/pdf/10.1056/nejmoa0910501.

    Question 3. Can you provide more detail about the Jackson Gabriel 
Silver Foundation? How successful have your fundraiser efforts been? 
Are there other EB foundations that you partner with? How do you invest 
the funds you have raised?
    Answer 3. The Jackson Gabriel Silver Foundation (``JGS 
Foundation'') is a recently formed non-profit dedicated to supporting 
research focused on curing and treating EB. Given its very recent 
Federal approval, the JGS Foundation has not held an official 
fundraiser yet. The Foundation plans to hold several major events a 
year and has raised over $55,000 without an official campaign in its 
few months of existence. We believe the JGS Foundation can become a 
significant fundraising vehicle to help children with EB. All funds 
raised are kept in FDIC insured checking or savings accounts. Just shy 
of 100 percent of every dollar raised is provided to researchers to 
advance their work on EB treatments and cures. However, given the small 
number of children with EB, raising the funds that are needed to 
advance EB treatments and cures to help today's children will not be 
possible without both direct and indirect Federal assistance.
    I am also a trustee of the Dystrophic Epidermolysis Bullosa 
Research Association of America (``DebRA''), which is the largest EB 
patient care non-profit in the United States. Within DebRA, my family 
and I have raised over $150,000 during the previous 2 years to help 
children with EB. The Epidermolysis Bullosa Medical Research Foundation 
(``EBMRF'') is the other significant American non-profit focused on 
curing EB. The EB community is small; the JGS Foundation, DebRA and the 
EBMRF have and should continue to work together to accomplish our 
goals.
    I estimate that in aggregate, these foundations have raised 
approximately $4 million over the last 3 years. To put this in context, 
inexpensive clinical trials are in the tens of millions. The cost of a 
child to participate in the University of Minnesota stem cell trial is 
$1 million. While I do believe the community can and will do a better 
job fundraising, we need the leadership of our Federal Government. 
Children with EB need both direct Federal support as well as private 
market incentives, such as the recently introduced Creating Hope Act of 
2010 (refining the rare tropical disease voucher program to include 
rare pediatric diseases), if these children are to have a chance of 
leading pain free and full lives. While the amount of funding needed to 
cure this disease is not small in absolute terms, it is quite small 
compared to Federal and private expenditures in every comparison. EB 
can be a curable disease and EB research can help other Americans with 
wounds and burns lead better lives; we just need to make it a higher 
priority.
                                 ______
                                 

                     [CNN Article, August 12, 2010]

                A Mother's Plea: Heal My Children's Skin

                           (By Madison Park)

                            Story highlights
     Epidermolysis bullosa is a terminal genetic condition that 
causes persistent skin problems.
     Patients lose their skin with the slightest friction 
because of the lack of a protein.
     Bone marrow transplant recipients show improvement in 
collagen levels and skin.

    For years, Theresa Liao heard there were no cures, no treatments, 
no hope to help her son Jake.
    ``When he was born, his hands looked like they had been boiled in 
oil,'' said his mother. ``It looked like someone had taken a potato 
peeler and skinned him down to muscle.''
    At the slightest friction, Jake's skin would shed, leaving the 
newborn wailing in pain. When Jake rubbed his eye, a chunk of his 
eyelid would come off in his fingers. He was born with recessive 
dystrophic epidermolysis bullosa, a terminal genetic condition in which 
persistent skin problems lead to crippling deformities and, eventually, 
skin cancer.
    Liao's crusade led to the first stem cell treatment for 
epidermolysis bullosa, also known as EB.
    New research findings, published in The New England Journal of 
Medicine this week, show that bone marrow transplants can help repair 
wounds and regenerate skin in EB patients. Doctors say it's an 
important step in stem cell science.
    ``I'm not saying this is a cure,'' said co-author Dr. Jakub Tolar, 
an associate professor of pediatrics at the University of Minnesota. 
``This is a critical step on the road to make this a disease of the 
past.''
    EB patients lack a protein called collagen 7 that acts as a Velcro, 
hooking the layers of skin--the epidermis and the dermis--together.
    The transplanted bone marrow contains stem cells that can turn into 
skin cells. These new skin cells could produce the missing collagen 7 
to stitch the skin layers, gradually healing the blisters and improving 
the patient's condition.
    The transplant appears to be effective, but doctors don't know 
exactly what type of stem cells are responsible for the change.
    EB patients have often been called butterfly children, because 
their skin is so sensitive. They have also been likened to permanent 
second-degree burn victims.
    The graze of a diaper can sheer off skin from their waist and inner 
thigh. Putting T-shirts over their heads can cut skin off their ears. 
In severe cases, children live in the bondage of bandages, like little 
mummies, to protect their fragile skin from wounds and infections.
    The constant inflammation and blisters can fuse fingers and toes, 
creating a webbed look. EB also irritates the lining of the esophagus, 
so that many children with the condition get stomach feeding tubes.
    The Netherlands allows for euthanasia for patients of this rare 
condition. The ones who survive to their 20s usually succumb to skin 
cancer.
    EB patients require daily bandage changes to protect their skin in 
an intensive process that takes about 4 hours. Liao likened it to 
``controlled torture.''
    For years, Liao, of Princeton, NJ, scoured the Web, and called 
companies, dermatologists, hematologists and nurses until one doctor 
mentioned that perhaps a stem cell treatment could reboot Jake's entire 
body to help him produce the missing collagen.
    Liao pounced after learning that Dr. John Wagner, director of 
pediatric blood and marrow transplantation and clinical director of the 
Stem Cell Institute at the University of Minnesota, would be in New 
York for a meeting in 2004. He had a long track record of working on 
stem cell and cord blood issues.
    Liao approached Wagner with her then-2-year-old Jake in her arms. 
Jake had thrown up parts of his esophagus a few days before, and was 
still moaning in pain.
    ``She held him up in front of me and said, `Please, save my child,' 
'' Wagner recalled.
    The pediatrician was horrified.
    He told Liao that he couldn't just start a stem cell treatment--
there had to be animal models, money for research (orphan diseases like 
EB are notoriously hard to fund), approval from regulatory bodies, and 
he needed to have a track record of treating the disorder. There were 
many complicated, time-consuming steps and millions of reasons to 
listen politely and walk away.
    ``Little by little, he tried to avoid me. I kept e-mailing him and 
calling him,'' Liao said.
    ``What affected me more was this mother pleading with me, saying 
`You can't say no. Everyone else says no. Everyone else says it's 
incurable.' '' Wagner said. ``I was both horrified and feeling horrible 
that I can just walk away from this and say, `I'm sorry. I take care of 
leukemia patients. I don't want to choose this one.' ''
    ``My research is developing stem cell-based therapies for kids who 
are destined to die. So I deal with many sad cases, but this one is 
over the top,'' he said.
    Though they had no experience in skin diseases, Wagner and Tolar, 
the study co-author, started examining stem cell possibilities for EB.
    They implanted several different types of stem cells into mice. 
After trial and errors, they eventually found that bone marrow 
transplants somehow helped heal wounds and regenerated skin in mice.
    In 2007, they started the first human clinical trial with seven EB 
patients.
    The transplants were risky because they require chemotherapy to 
wipe out the recipient's immune system to prevent rejection of the bone 
marrow.
    Liao knew the risks but said she felt Jake and a younger brother 
were ``going to die, relatively painfully and have a difficult 
existence'' until passing away from malnutrition or cancer with the 
disease.
    ``Before anyone judges me or my family, I'm not going to ask them 
to walk a mile in my shoes, I would say take about three steps,'' Liao 
said. ``Somebody had to go first. Somebody had to make a difference.''
    By that time, Jake was 5 years old and had a 16-month-old brother, 
Nate, who also had EB.
    In November 2008, Nate went first in the trial, receiving a bone 
marrow transplant from a perfect match--his older brother, Julian.
    When doctors examined Nate months after the surgery, the contrast 
was striking. Nate was also producing more collagen 7.
    ``The differences in the way the skin healed, he was very 
different,'' Wagner said. ``He gave us hope.''
    Seven months later, Jake was patient No. 3 in the trial, receiving 
a bone marrow transplant from a cord blood match.
    But Jake struggled. Stricken with complications of the transplant 
and an infection, he died 183 days after the procedure.
    Out of seven children in the trial, two died. The other child had 
died in the clinical trial before the transplant. The transplant has 
inherent risks, the authors said.
    ``This is bone marrow transplantation, it's not a trivial 
procedure,'' said Dr. Jouni Uitto, professor and chairman of 
dermatology and cutaneous biology at Thomas Jefferson University, who 
was not part of the study. ``It's a major procedure that has a high 
risk component.''
    The five participants who survived have all improved. One boy 
bought a trampoline and can enjoy activities he never imagined before 
the transplant.
    ``It's an exciting study in the sense it raises cautious optimism 
that bone marrow transplantation may be a way of treating the 
condition,'' Uitto said.
    More research is under way to better minimize risks. Since the 
study was published, six more children with EB have received 
transplants, and all have shown improvements, doctors said.
    Hundreds of EB patients have come to Minnesota hoping to take part.
    It's bittersweet for Liao, as she closely monitors Nate's health, 
but also grieves for Jake.
    ``I'm still involved because of Nate. There's a lot more work. I 
really want this disease wiped off the planet. It wiped my son off the 
planet. It's fair play.''
                                 ______
                                 
   National Organization for Rare Disorders (NORD),
                                                   August 19, 2010.
Hon. Tom Harkin, Chairman,
Health, Education, Labor, and Pensions Committee,
U.S. Senate,
Washington, DC 20510.

    Dear Mr. Chairman: On behalf of the millions of men, women and 
children affected by one of the thousands of rare diseases, the 
National Organization for Rare Disorders thanks you for the opportunity 
to testify before your committee on July 21, 2010.
    Below are the answers to the questions posed by Senators Enzi, 
Casey and Franken. Rather than answer each question individually in 
some cases, attached please find NORD's testimony before the FDA's Part 
15 hearing on June 29, 2010. Frank Sasinowski, who delivered the 
statement, is Chair of NORD's Board of Directors. He delivered the 
statement before the FDA hearing on ``Considerations regarding FDA 
review and regulation of articles for the treatment of rare diseases.''
            Respectfully Submitted,
                                      Diane Edquist Dorman,
                                     Vice President, Public Policy.
                                 ______
                                 
   Response to Questions of Senator Enzi, Senator Casey and Senator 
                    Franken by Diane Edquist Dorman

                              SENATOR ENZI

    Question 1. Are existing incentives sufficient to support the 
development of therapies for rare diseases? How might these incentives 
be improved or increased?
    Answer 1. Please see attached document.

    Question 2. Some of the incentives available for pediatric and rare 
and neglected diseases are stackable--a business can get more than one 
for a given product. Do the different programs work well together? 
Could they be more coordinated?
    Answer 2. NORD agrees with the American Academy of Pediatrics that 
``the orphan drug exclusivity provided by the Orphan Drug Act and the 
pediatric exclusivity offered by the Best Pharmaceuticals for Children 
Act (BPCA) work well together to improve access to safe and effective 
drugs for children and patients with rare diseases.
    The Orphan Drug Act incentivizes the development of drugs for rare 
diseases and BPCA incentivizes the study of drugs in pediatric 
populations. Pediatric exclusivity under BPCA is only granted in 
response to fulfilling the requirements of a written request issued by 
FDA and is not given in conjunction with any other incentive program.
    Both incentive programs are necessary and serve distinct purposes. 
Whereas BPCA may be used to add pediatric labeling information to a 
popular adult drug, the Orphan Drug Act may be used to incentivize the 
development of that same drug to treat an entirely different condition 
that classifies as a rare disease.''

    Question 3. Given the genetic basis of many rare diseases, has the 
Human Genome Project helped rare disease research and development of 
treatments?
    Answer 3. Yes. NORD believes that the National Institutes of Health 
has made important strides towards increased research into rare 
diseases and the development of treatments for them. The NIH recently 
announced the establishment of the Therapeutics for Rare and Neglected 
Diseases (TRND) initiative. It was recognized that of the 7,000 human 
diseases, fewer than 300 are of interest to the biopharmaceutical 
industry, due to limited prevalence and/or commercial potential. More 
than 6,000 of these diseases are rare (defined by the Orphan Drug Act 
as <200,000 U.S. prevalence), and the remainder are neglected because 
they affect impoverished or disenfranchised populations. Researchers 
have now defined the genetic basis of more than 2,000 rare diseases and 
identified potential drug targets for many rare and neglected diseases 
(RND) (http://rarediseases.info.nih.gov/Resources.aspx?PageID
=32).

    Question 4. Can you elaborate on striking the correct balance 
between the safety and risk of treatments for patients suffering from 
rare diseases versus for patients with more common conditions?
    Answer 4. Please see attached document.

                             SENATOR CASEY

    Question 1. In your testimony, you talked about how FDA reviews 
safety and efficacy data for orphan diseases and say that ``without a 
statement of policy on rare diseases and orphan products, it is not 
possible [for the FDA] to ensure consistency in that process.'' Can you 
elaborate on why this is necessary and what sort of information you 
would like to see in such a policy statement? How should such a 
statement take children with rare diseases into consideration?
    Answer 1. Please see attached document.

    Question 2. Can you comment on the balance between public 
investment and private investment in finding cures for rare and 
neglected diseases?
    Answer 2. Unlike patients with conditions that affect very wide 
populations, the rare disease community has always taken a pro-active 
approach towards rare disease research and the development of orphan 
therapeutics. Patients and the organizations and foundations that 
represent them attempt to raise small sums of money with the hope of 
raising sufficient funds to interest an academic researcher in 
conducting the needed basic research on their particular rare disease. 
But progress can be very slow. For that reason alone, the rare disease 
community is very dependent on the cutting-edge basic and translational 
research being conducted at the National Institutes of Health and other 
healthcare-related Federal agencies.
    In order to move the basic and translational research to actual 
treatments, there must be increased coordination of efforts between 
Federal agencies, the biopharmaceutical and medical device industries, 
as well as patient organizations.
    For this reason, NORD is working closely with the NIH, FDA, 
academic investigators and industry to find better pathways to orphan 
product development. More detailed information is included in the 
attachment.
    Attached you will find the ORDR Newsletter on Rare Diseases (May 
2010) providing information about all programs and initiatives related 
to rare diseases within the NIH. NORD is unable to estimate the funding 
for these programs.

                            SENATOR FRANKEN

    Question 1. I recently heard about a 14-month old boy who's being 
treated at the University of Minnesota. He was ill as an infant, has 
intestinal problems, and can't eat normally. He survives with IV 
nutrition and an investigational drug that's approved in Germany. This 
drug enables him to absorb nutrients so he can survive beyond the age 
of 3. At first, his mother's insurance covered the investigational 
drug. Then his mom lost her job and his father's insurance refused to 
cover the monthly cost of $1,200. The family can't afford the cost and 
so this child will stop receiving the treatment, which will lead to 
liver disease or liver transplant, and very possibly, his death, even 
though the treatment is working for him! This is just not right. What 
can we do to encourage insurers to cover treatments in such cases?
    Answer 1. Unfortunately, Senator Franken, this scenario is one NORD 
hears many times a day. If a therapy is considered ``experimental'' by 
insurers, they may refuse to pay for it, leaving patients and their 
families few alternatives. When families contact NORD with these types 
of situations, we often refer them to the insurance commissioner in 
their State, who is sometimes able to intervene. One part of the 
solution is increased cooperation between European and U.S. regulators, 
and NORD is working with FDA and EMA in Europe to encourage that. Also, 
in very serious situations where there is no FDA-approved alternative 
for the patient, it may be possible for advocates such as NORD to help 
patients obtain life-saving medications through Expanded Access 
Programs. FDA has an Office of Special Health Issues that is sometimes 
able to help individuals obtain access to investigational drugs. Today, 
these scenarios are addressed on a case-by-case basis but it would be 
wonderful if insurers could be required to pay when patients face 
severe consequences and have no approved alternatives.
                                 ______
                                 
    Attachment 1.--Prepared Statement of the National Organization 
                       for Rare Disorders (NORD)
      (presented at the u.s. food and drug administration part 15 

                     PUBLIC HEARING--JUNE 29, 2010)

    Good morning. The National Organization for Rare Disorders (NORD) 
welcomes this opportunity to be the initial presenter at the FDA's 
first public hearing on rare disorder therapies. I am Frank Sasinowski, 
Chair of the Board of NORD, and we want to share our views on the FDA's 
exercise of its responsibilities for regulating therapies for Americans 
with rare disorders.
    NORD is the leading advocate for the 30 million Americans with rare 
disorders. NORD is justifiably proud of our history as the principle 
force behind the effort that culminated in the 1983 Orphan Drug Act. 
And, NORD is just as equally proud of our current activities to advance 
the interests of Americans who have 1 of 6,000 rare disorders. I only 
have time to merely list some of NORD's major initiatives over the past 
13 months.

    1. NORD organized a full-day Summit on orphan disorders at the 
Willard Hotel in May 2009 which was chaired by former FDA Commissioner 
Kessler and key participants which included Dr. Janet Woodcock and Dr. 
Francis Collins. A summary of this Summit is available on the NORD Web 
site.
    2. NORD, with the assistance of John Crowley, CEO of Amicus, one of 
NORD's Corporate Council members, was responsible for organizing a 
Congressional Caucus on Rare and Neglected Diseases this year.
    3. NORD was a key player involved in Section 740 of the fiscal year 
2010 Appropriations Act (the so-called Brownback/Brown amendment) which 
is the impetus for this hearing.
    4. NORD suggested and supported that the FDA and the Center for 
Drug Evaluation and Research (CDER) establish its first position 
dedicated to issues related to the regulation of medicines for those 
with rare disorders, and in February FDA created the post of CDER 
Associate Director for Rare Diseases.
    5. NORD worked for the passage of comprehensive health care reform, 
and in particular, those two provisions of vital interest to those with 
rare disorders: eliminating pre-existing conditions and eliminating 
lifetime and annual insurance caps. To see that what was gained in 
Congress is not lost in the courts, NORD is currently participating in 
an amicus brief to defend the constitutionality of the health care 
reform law.
    6. NORD, with the involvement of FDA Commissioner Hamburg and NIH 
Director Collins, set up a Task Force on rare disorders in January. In 
several meetings at which senior FDA and NIH officials participated, 
NORD has explored ways to facilitate the development of therapies for 
rare disorders, including holding a series of four focus groups, each 
separately meeting with representatives of patient organizations, the 
medical and scientific research community, the pharmaceutical industry 
and the financial investment community.
    7. And, finally, on the seventh day, NORD rested.

    Both at the NORD Summit last May and at the NORD Task Force 
meetings, including focus groups, NORD has learned much and we want to 
share some of those key findings with FDA today.
    First, over the 27 years since its enactment the Orphan Drug Act 
has proven a resounding success. This is best seen in the over 350 new 
medicines for more than 200 different rare disorders approved by FDA 
over the first quarter of a century of the law's existence. However, 
what NORD learned at its Summit and in its Task Force proceedings is 
that there are still about 5,800 disorders for which there are no FDA-
approved therapies. Perhaps most discouraging is that many affected 
with these rare disorders do not even see any research being conducted 
in their conditions. To NORD, this seems as though the proverbial low 
hanging fruit have already been harvested in the first quarter of a 
century of the law's existence, while the vast majority of therapies 
are currently out of reach of those in need of an FDA-approved 
medicine. In sum, much has been accomplished by FDA, by NIH, by medical 
and scientific researchers, by the pharmaceutical industry, by the 
financial community and by patient advocates in these first 27 years, 
but much, much, much, much more beckons each of us to respond to the 
needs of those with rare disorders.
    Second, how best can each of us respond to those in need of 
therapies? As part of the NORD Task Force, NORD--with senior FDA and 
NIH officials--in April held a series of four focus groups to listen 
and learn what are the barriers slowing or barring the development of 
new therapies for rare diseases, especially the 5,800 rare disorders 
for which there are no FDA-approved medicines. We had a separate focus 
group with each of the four major stakeholders involved in developing 
new therapies--the patient community, the academic research community, 
the pharmaceutical industry and the financial investment community. In 
those Task Force proceedings and at the NORD Summit, we heard many 
ideas. Several of those ideas would require new legislation and so 
those are beyond the scope of today's hearing.
    What we at NORD heard which can be addressed by FDA is the benefit 
that would be gained from FDA action on the following two NORD 
recommendations:

    I. For a clearer, more granular expression of FDA's historic 
commitment to exercise flexibility in its review of therapies for rare 
disorders; and
    II. For an FDA expression of ways to reduce regulatory uncertainty 
in the development and review of orphan disorder therapies.

    Let's explore each of those.
    nord recommendation #i--for an fda statement of policy on fda's 

            HISTORIC FLEXIBILITY IN REGULATING ORPHAN DRUGS

    NORD heard, especially from the investment community and the 
pharmaceutical industry, that FDA delivers a consistent, repeated 
message that the statutory standards for safety and efficacy are the 
same for both rare disorders and prevalent diseases. What is not often 
heard is the companion portion that completes that statement which is 
that, while the statutory standards are the same, the FDA 
interpretation and application of those same standards have 
historically been tailored by FDA to the unique facts of each 
particular medicine under FDA review. Moreover, there are FDA 
regulations and guidances that express this flexibility. In addition, 
FDA actions on marketing applications eloquently embrace and express 
this concept of flexibility. This exercise of FDA scientific judgment 
in applying these statutory standards flexibly to various situations 
apparently is not being heard by some of the key stakeholders in this 
system.
    So, today NORD is asking the FDA to develop and issue a specific 
Statement of Policy on FDA's role in regulating therapies for rare 
disorders which includes an explanation and affirmation of the FDA's 
historic position that FDA flexibly applies the standards of safety and 
effectiveness with respect to therapies for those with rare disorders. 
What we, NORD, have heard is that the investment community and 
pharmaceutical industry may benefit from such a formal, explicit 
statement of policy that will encourage investment in, research of and 
development of medicines for those with rare disorders, especially for 
those 20 million Americans with one of the 5,800 rare disorders for 
which there still is not a single FDA-approved therapy.

                    1. FDA REGULATIONS AND GUIDANCES

    A. In responding to the AIDS crisis that was becoming apparent 
around the same time that FDA was implementing the Orphan Drug Act in 
the mid-1980s, FDA promulgated Subpart E of the IND regulations for 
``drugs intended to treat life-threatening and severely-debilitating 
illnesses.'' FDA stated that the purpose of Subpart E is,

          ``to establish procedures designed to expedite the 
        development, evaluation, and marketing of new therapies 
        intended to treat persons with life-threatening and severely-
        debilitating illnesses, especially where no satisfactory 
        alternative therapy exists. As stated [in section] 314.105(c) 
        of this chapter, while the statutory standards of safety and 
        effectiveness apply to all drugs, the many kinds of drugs that 
        are subject to them, and the wide range of uses for those 
        drugs, demand FLEXIBILITY in applying the standards. The FDA 
        has determined that it is appropriate to exercise the broadest 
        FLEXIBILITY in applying the statutory standards, while 
        preserving appropriate guarantees for safety and effectiveness. 
        These procedures reflect the recognition that physicians and 
        patients are generally willing to accept greater risks or side 
        effects from products that treat life-threatening and severely-
        debilitating illnesses, than they would accept from products 
        that treat less serious illnesses. These procedures also 
        reflect the recognition that the benefits of the drug need to 
        be evaluated in light of the severity of the disease being 
        treated.'' (Emphasis added.)

    B. The regulation that was referenced in the Subpart E regulation 
is section 314.105(c) which even predates the Subpart E regulation and 
illustrates again FDA's historic position on applying the same 
statutory standards in a flexible way depending upon the circumstances. 
Section 314.105(c) states that:

          ``FDA will approve an application after it determines that 
        the drug meets the statutory standards for safety and 
        effectiveness, manufacturing and controls, and labeling. While 
        the statutory standards apply to all drugs, the many kinds of 
        drugs that are subject to them and the wide range of uses for 
        those drugs demand FLEXIBILITY in applying the standards. Thus 
        FDA is required to exercise its scientific judgment to 
        determine the kind and quantity of data and information an 
        applicant is required to provide for a particular drug to meet 
        them. FDA makes its views on drugs products and classes of 
        drugs available though guidelines, recommendations and 
        statements of policy'' (emphasis added).

    C. An example of a formal regulatory policy or guidance that 
expresses this concept of ``flexibility'' in FDA's application of the 
statutory standards of safety and efficacy is seen in the ICH E1A 
guidance. That FDA-adopted international guidance stipulates the 
minimum quantum of safety exposures necessary for FDA to even accept a 
marketing application for review when the medicine is intended for a 
chronic condition. Most rare disorders are chronic in nature and not 
acute, and so this guidance applies to most rare disorder therapies. 
The guidance states that the minimum number of safety exposures to meet 
the statutory standard for safety are 1,500 persons exposed to the 
investigational therapy with 300 to 600 of those exposed for at least 6 
months and with at least 100 exposed for 1 year. However, the guidance 
states that these minimum safety thresholds do not apply to therapies 
for rare disorders. Importantly, the guidance then does NOT state what 
is required in the alternative whereas it could have stated an 
algorithm such as at least 1 percent of the U.S. population with the 
rare disease must be exposed with half of them for at least 1 year. No, 
instead the guidance relies upon the exercise of FDA's scientific 
judgment to determine what is appropriate to meet the statutory 
standard for safety in each particular rare disorder therapy.

     2. fda actions on rare disorder therapy marketing applications
    Instead of reviewing many such precedents, NORD refers to but one 
recent example as illustrative. In March of this year, FDA approved 
Carbaglu for NAGS deficiency, the rarest urea cycle disorder, with only 
10 patients in the United States generally at any time. In the FDA 
briefing document for the January 13, 2010 Advisory Committee meeting, 
FDA explained that while Congress in 1962 added a new statutory 
standard requiring that a drug prove its effectiveness,

          ``FDA has been FLEXIBLE within the limits imposed by the 
        congressional scheme, broadly interpreting the statutory 
        requirements to the extent possible where the data on a 
        particular drug were convincing . . . Thus, evidence obtained 
        from retrospectively reviewed case series could be considered 
        as substantial evidence of effectiveness . . . The fact that 
        the case series presented in this application is retrospective, 
        un-blinded, and uncontrolled precludes any meaningful formal 
        statistical analyses of the data. Under these conditions, any 
        statistical inference from confidence intervals and/or p-values 
        is uninterpretable and, consequently, should not be utilized to 
        inform clinical decisionmaking.'' (See pages 9 & 10 of the 
        briefing document attached to Dr. Griebel's December 16, 2009 
        memo to the Advisory Committee, emphasis added.)

          3. dr. goodman's june 23, 2010 statement to congress
    Dr. Jesse Goodman, FDA Chief Scientist and Deputy Commissioner for 
Science and Public Health, testified last week before the Senate 
Appropriations Committee Agriculture Subcommittee on ``FDA's efforts on 
rare and neglected diseases.'' In Dr. Goodman's commendable testimony 
he cites to the Carbaglu example as well as several others to 
illustrate that:

          ``FDA is fully committed to applying the requisite 
        FLEXIBILITY in the development and review of products for rare 
        diseases, while fulfilling its important responsibility to 
        assure that the products are safe and effective for these 
        highly vulnerable populations. There are numerous examples of 
        drugs approved for treating rare diseases where FDA's 
        FLEXIBILITY and sensitivity to the obstacles of drug 
        development for rare diseases has brought forth a successful 
        treatment'' (emphasis added).
          4. personal example from meeting this month with fda
    In a meeting I had this month the FDA told the sponsor at an End of 
Phase 2 meeting for a therapy to treat a very troublesome symptom of a 
very serious and common (that is, prevalent) disease that the sponsor 
had not only to prove the effectiveness of the drug to treat the 
symptom but also had to rule out that the drug did not increase 
unacceptably the risk of death in that patient population with this 
serious disease. FDA stated that the sponsor would have to show what 
increase in the risk of death could be excluded by reference to the 
upper 95 percent confidence interval. While we did not at that meeting 
arrive at an agreement on the size of the magnitude of risk that had to 
be excluded, even ruling out only a doubling of the risk of death would 
likely require a study of thousands of subjects for a long period of 
time. While I have been involved in scores, maybe hundreds, of 
therapies for rare disorders, I have never heard FDA express a similar 
requirement for a therapy for a rare disease. Why? This is likely 
because FDA is being flexible in interpreting and applying the 
statutory standards for safety and efficacy in that FDA knows that to 
require a similar type of showing for a therapy for a rare disorder 
would be impossible for almost all orphan drugs given the limited pool 
of potential subjects for clinical trials. The statutory standards are 
the same both for the prevalent disease and the orphan condition, but 
FDA rightly interprets and applies the standards in light of the 
disease and investigational therapy.
    In other areas FDA can exercise similar flexibility. For instance, 
where the potential number of subjects is limited, the degree to which 
FDA demands dose selection be optimized in pre-approval studies may be 
reduced as can be FDA's requirements for validation of a patient 
reported outcome instrument in a rare disorder population or proof of 
the sensitivity, specificity and clinical meaningfulness of a primary 
endpoint. Given that each investigational therapy for a rare disorder 
will present unique features, NORD understands that the granularity of 
the requested statement of policy on rare disorder therapies may 
necessarily be limited. However, even cataloging the nature and scope 
of the orphan product precedents that illustrate FDA's flexibility may 
enable key stakeholders to better understand FDA's position. That is, 
even while FDA states correctly that the statutory standards are the 
same for prevalent and rare conditions, FDA will have a formal 
companion statement of the equally important and consistent FDA 
historic position that FDA will exercise its scientific judgment to 
interpret and apply those statutory standards in a flexible manner, 
tailored to each rare disorder therapy.
    NORD looks forward to the FDA issuance of an FDA Statement of 
Policy on FDA's regulation of therapies for rare disorders and to the 
day when every FDA official who speaks to patients or to other 
stakeholders, including researchers and sponsors, about the FDA 
policies on regulating therapies for rare disorders does so in the 
complete and balanced way that Dr. Goodman did last week when he 
testified to both that as to the identical statutory standards that 
rare disorder therapies must meet as well as to the historic FDA 
flexibility in interpreting and applying those standards, exercising 
FDA's scientific judgment in light of the particular circumstances of 
that unique rare disorder and specific investigational therapy.

    NORD RECOMMENDATION #II--REDUCING REGULATORY UNCERTAINTY IN THE 
              DEVELOPMENT OF MEDICINES FOR RARE DISORDERS

    In addition to the willingness of persons with rare, serious 
diseases to accept more safety risks and less rigorous evidence of 
effectiveness than for a prevalent disease or for a less serious 
disease or for one with some already approved therapy, and in addition 
to learning that some key stakeholders would benefit from a formal FDA 
statement of policy on FDA's exercise of its flexibility, the other 
consistent message we at NORD learned from our research and 
interactions since the NORD Summit in May 2009 is that the development 
of therapies for rare disorders could additionally benefit from a 
reduction in regulatory uncertainty.
    It is axiomatic that the perfect is the enemy of the good. In the 
world of rare disorders, there is much that is often not known or not 
known well, starting with the etiology and pathophysiology of the 
condition, including its natural history, and ranging to a lack of 
agreement among even a small handful of world experts on the most 
common clinical manifestations of some conditions. Against this 
backdrop, it is entirely understandable that FDA on occasion will find 
it difficult to concur in advance with a development program, even the 
design of a registrational trial under a special protocol assessment. 
However, researchers, industry and FDA, as well as most importantly, 
persons with the condition, may find that sometimes a study needs to 
proceed because patients are suffering and can not wait for the perfect 
trial design with the ideal primary endpoint to be eventually 
determined or developed and consensually accepted.
    Research resources in the universe of rare disorders are precious, 
with the most precious being the persons with the rare disorders who 
are heroically volunteering to participate in a trial, usually under 
conditions where there is less known than in trials of therapies for 
prevalent diseases about the safety and potential effectiveness of the 
investigational therapy from animal models, animal toxicology and early 
human trials. So, when these trials are conducted, sometimes with 
designs with which all parties may not be in full concurrence, 
including the FDA, great deference should be afforded the design of 
these trials and flexibility applied in the interpretation of their 
results. If such a principle were to be addressed and accepted by the 
FDA, much good would come of it.

                                CLOSING

    On behalf of all those with rare disorders, NORD commends the FDA 
on its stellar, worldwide leadership role on orphan product issues for 
the past 27 years, and NORD exhorts FDA to continue to embrace even 
more fully the historic flexibility FDA has long noted and exercised in 
FDA's regulation of medicines for those Americans with rare disorders 
and to grapple with ways that can be managed by FDA to reduce the 
regulatory uncertainty in the development and review process.
    NORD commits to do all it can to continue to provide input to FDA 
on matters related to FDA's vital responsibilities for the regulation 
of investigational therapies for each of the 30 million Americans with 
rare disorders, but especially for those more than 20 million who have 
the 5,800 rare disorders for which there are no current FDA-approved 
therapies.
    Finally, NORD would like to publicly and formally express NORD's 
deep appreciation to the FDA for holding this hearing today on these 
critically important issues to so many Americans.
    Thank you.

       Attachment 2.--Office of Rare Diseases Research Newsletter
                   Focus on Rare Diseases--Highlights

       RARE DISEASES CLINICAL RESEARCH NETWORK (RDCRN II) UPDATE

    In the fall of 2009, the NIH Office of Rare Diseases Research 
(ORDR) in collaboration with seven NIH Institutes (NICHD, NHLBI, NIDDK, 
NIAMS, NINDS, NIDCR, and NIAID) renewed and expanded the RDCRN Program. 
The level of support received from the ICs (institutes and centers) has 
increased, and in the expanded RDCRN (called RDCRN II) ORDR was able to 
provide support for 19 consortia. The Data and Technology Coordinating 
Center has been continued in RDCRN II as the Data Management 
Coordinating Center with a slightly different charge. In RDCRN II, 56 
Patient Advocacy Groups (PAGs) are participating and collaborating in 
the clinical studies of more than 90 rare diseases at over 130 research 
sites. The first Steering Committee and Orientation Meeting for the 
Principal Investigators (PIs) was held on October 1-2, 2009. This 
meeting was also attended by PAGs, co-PIs, and relevant program staff 
from the ICs.
    Below is a link to the NIH press release about the expansion of 
Rare Diseases Clinical Research Network. http://www.nih.gov/news/
health/oct2009/od-05.htm.

COLLABORATION, EDUCATION, AND TEST TRANSLATION PROGRAM FOR RARE GENETIC 
                            DISEASES (CETT)

    People affected by rare inherited diseases need the reliable 
information that comes through quality genetic testing. The goal of the 
CETT Pilot Program is to help facilitate the translation of new tests 
for rare genetic diseases. The program's objectives are to translate as 
many appropriate tests as possible, ensure that the best possible test 
is offered in light of current knowledge, and ensure that the test 
meets the needs of the community. All tests are important whether the 
specific condition affects 5 people or 50,000.
    The CETT Pilot Program's objectives require a strong collaboration 
between researchers, clinicians, patient advocates and clinical 
laboratories. The program has several new enhancements to facilitate 
the development of collaborations, researcher consultation, and 
educational materials. The program also supports the electronic 
collection of genetic and clinical data in public databases to 
accelerate access to the information for new research and treatment 
possibilities.
    Discussions are underway to determine the future function of this 
pilot program and how to move it to permanent status within the NIH to 
best serve the public. For more information, please visit: http://
rarediseases.info.nih.gov/cettprogram/about.aspx.

                    NIH UNDIAGNOSED DISEASES PROGRAM

    The National Institutes of Health (NIH) launched the Undiagnosed 
Disease Program (UDP) in May 2008 to evaluate patients with disorders 
that have evaded a diagnosis. Often such patients, seek help from 
multiple physicians and other health care providers over many years 
before a diagnosis is made. The UDP has been organized by the National 
Human Genome Research Institute (NHGRI), the Office of Rare Diseases 
Research (ORDR), and the NIH Clinical Center. The program's main goals 
are to provide answers to patients with mysterious conditions that have 
long eluded a diagnosis and to advance medical knowledge about rare and 
common diseases.
    By all accounts, the program has been successful. More personnel 
have been hired and funding has been increased. Over the year and a 
half since its inception, there have been more than 3,000 inquiries, 
more than 1,200 medical records submitted, 300 patients accepted, and 
about 220 of these patients seen so far at the NIH Clinical Center in 
Bethesda, MD. It is interesting that over half of the applications fall 
into the realm of neurology. As an indication of the seriousness of the 
illnesses for which patients are applying, 13 who have applied have 
died, most before they could be seen at the Clinical Center. There have 
been 5 to 10 true diagnoses made. In one of these, a family with 
arterial calcifications of the lower extremities, a causative mutation 
was found in a gene not known to be involved in any other disease. The 
UDP provides both diagnostic support and new insights into rare 
diseases.
    Additional information can be found at: http://
rarediseases.info.nih.gov/Resources
.aspx?PageID=31.

      THERAPEUTICS FOR RARE AND NEGLECTED DISEASES (TRND) PROGRAM

    Both the need and opportunity for Therapeutics for Rare and 
Neglected Diseases (TRND) are enormous. Of the 7,000 human diseases, 
fewer than 300 are of interest to the biopharmaceutical industry, due 
to limited prevalence and/or commercial potential. More than 6,000 of 
these diseases are rare (defined by the Orphan Drug Act as <200,000 
U.S. prevalence), and the remainder are neglected because they affect 
impoverished or disenfranchised populations. Researchers have now 
defined the genetic basis of more than 2,000 rare diseases and 
identified potential drug targets for many rare and neglected diseases 
(RND).
    TRND received $24 million in the NIH budget for fiscal year 2009. 
TRND is a collaborative drug discovery and development program with 
governance and oversight provided by Office of Rare Diseases Research. 
Program operations will be within the intramural research program 
administered by the National Human Genome Research Institute.
    For more information, please see the Program to Advance Development 
of Drug Candidates for Rare and Neglected Diseases Request for 
Information (RFI) Web page: https://www.fbo.gov/spg/HHS/NIH/NHLBI/
NHLBI-NHGRI-2010-112/listing.html .

                CREATING A GLOBAL RARE DISEASE REGISTRY

    In January 2010, the Office of Rare Diseases Research (ORDR) 
organized a workshop, Advancing Rare Disease Research: The Intersection 
of Patient Registries, Biospecimen Repositories, and Clinical Data, to 
discuss the development of an infrastructure for an internet-based rare 
disease patient registry, which would also include access to 
biospecimens. The workshop was sponsored by ORDR and the National Eye 
Institute (NEI), the National Center for Research Resources (NCRR), 
patient advocacy groups, and the private sector. Workshop attendees 
discussed approaches to creating a federated registry that would 
collect and aggregate patient data, serve as a core data repository and 
also link to other existing registries. This would allow expanded data 
access for patients, families, clinicians and researchers seeking 
accurate information. As an additional aid to research, the registry 
would also link to biorepositories of rare disease biospecimens.
    During the presentations and breakout sessions, attendees 
representing advocacy groups, researchers, information technology 
experts, and government and private sector personnel dealt with issues 
related to this umbrella infrastructure. Workshop attendees expressed 
an enthusiasm and a commitment to getting involved and making it 
happen. Post workshop committees will guide the effort as it moves 
forward.

                 NIH ANNOUNCES GENETIC TESTING REGISTRY

    The NIH announced on March 18 that it is creating a public database 
that researchers, consumers, health care providers, and others can 
search for information submitted voluntarily by genetic test providers. 
The Genetic Testing Registry aims to enhance access to information 
about the availability, validity, and usefulness of genetic tests. For 
more information please see: http://www.nih.gov/news/health/mar2010/od-
18.htm.

                     NIH BIOSPECIMEN INTEREST GROUP

    On Thursday, April 15, 2010, the NIH Biospecimen Interest Group 
(BIG) held a meeting that featured a series of presentations on 
biospecimen resources within and supported by the NIH. BIG is sponsored 
by the Office of Rare Diseases Research and the Office of 
Biorepositories and Biospecimen Research, National Cancer Institute 
(OBBR/NCI).
    The event, which took place in the Masur Auditorium in the Clinical 
Center, was well attended, and the attendees found it very informative. 
The interest group offers a forum for trans-NIH interactions and 
enhanced information sharing. Members were asked to share ideas for 
future meetings. The meeting included the following presentations:

    ``The NIDDK Central Repositories''
    ``eyeGENE (NEI) Genotype/Phenotype Database, Repository and 
Registry''
    ``Tissue Biospecimens in Cancer Epidemiology Studies"
    ``The National Cancer Institute's Cooperative Human Tissue 
Network''
    ``BioLINCC: Access to NHLBI Biospecimens and Data''

    The event was videocast and is available for viewing. (http://
videocast.nih.gov/summary.asp?live=8662)
vi international conference on rare diseases and orphan drugs in buenos 

                           AIRES (ICORD 2010)

    A global meeting on international cooperation and policies for rare 
diseases and orphan products was held in Buenos Aires, Argentina on 
March 18-20, 2010. The VI International Conference on Rare Diseases and 
Orphan Drugs (ICORD 2010) convened for the first time in the southern 
hemisphere in agreement with its aim of globalization of rare diseases 
research and orphan products development activities.
    Individuals and organizations from patient groups, academic 
research investigators, the pharmaceutical, biotechnology and medical 
device industries, and government policy and decisionmakers were 
invited to participate in this unique forum. Specialized courses, and 
open meetings with key people in the field were available for 
participation during the days previous to the conference (March 16 and 
17), as well as a pre-meeting about the Latin American and Caribbean 
initiatives (ER2010LA) in rare diseases and orphan products.
    Because of its nature, rare diseases would be better researched and 
managed within an international landscape, and this conference offered 
the opportunity to join the discussion of the ideas and global needs of 
the rare diseases community. The economic impact of introducing new 
therapies and how cooperative strategies may influence the cost of 
these treatments was a special topic along with the special 
informational and individual needs of the patients and families across 
the lifespan. Also of interest were the particular needs of the 
developing world in the management of diseases that are rare in 
developed countries but neglected in the environments where the 
diseases occur more frequently.
    GEISER Foundation, the first non-profit umbrella organization for 
rare diseases in Latin America and the Caribbean hosted the conference 
and the pre-activities. Information about the conference is found on 
the ICORD 2010 conference Web site. (Presentations will be available 
later on www.icord.se). GEISER Foundation on the web: http://
www.fundaciongeiser.org.

             INTERNATIONAL COLLABORATIONS: JAPAN AND KOREA

    The Office of Rare Diseases Research held two meetings in early 
2010 with overseas visitors interested in rare diseases research and 
orphan products development. The first meeting took place in January 
with visiting scientists from the Japanese Ministry of Health, Labour 
and Welfare and the National Institute of Public Health. The second 
meeting was held in February with scientists from the Korean National 
Institute of Health, Sungkyunkwan University and Seoul National 
University.
    The NIH agenda topics included:

     Genetic and Rare Diseases Information Center (ORDR)
     Undiagnosed Diseases Program (NIH: ORDR, Clinical Center, 
Institutes)
     Clinical Trials.gov (NIH)
     Therapeutics for Rare and Neglected Diseases Program 
(NHGRI)
     Rare Diseases Clinical Research Network (ORDR, Institutes)
     Genetic Test Translation Program (CETT/ORDR)
     Clinical Center programs and protocols
     Clinical and Translational Science Awards, Clinical 
Research Network Program (NCRR)
     Office of Orphan Product Development (FDA)

    Presentations were also made by the Japanese and Korean visitors 
describing their health and research organizations, and their research 
and product development activities. The meeting agendas allowed ample 
opportunity for discussion following each talk. ORDR also included a 
presentation on an educational module on rare diseases designed for 
middle school students, which when completed, will be available at no 
expense not only in the United States but also to other countries for 
their use.
    The NIH and other U.S. presenters and the Japanese and Korean 
presenters agreed that their meeting was successful in advancing 
communication, sharing knowledge, and stimulating potential research 
collaborations in rare diseases research and orphan products 
development.

                SCIENCE OF SMALL CLINICAL TRIALS COURSE

    ``The Science of Small Clinical Trials,'' a course created jointly 
by the FDA's Office of Orphan Products Development (OOPD) and NIH's 
Office of Rare Diseases Research, deals with issues concerning the 
design and analysis of clinical trials based on small study 
populations. While small clinical trials are a necessity in the context 
of rare diseases, being able to conduct small trials with scientific 
rigor is of increasing importance in other contexts, particularly as 
genomic science begins to provide opportunities for individualized 
pharmacology. Over 1,500 individuals requested for the course. http://
small-trials.keenminds.org/http://videocast.nih.gov/PastEvents
.asp?c=88.

  RARE CANCERS WITH HIGH MORTALITY: CHALLENGES FOR CANCER PREVENTION 
                             AND TREATMENT

    Recently a workshop, Rare Cancers with High Mortality: Challenges 
for Cancer Prevention and Treatment, was held to discuss the issues and 
challenges associated with rare cancers and to facilitate 
collaborations among the participants. Approximately 200 participants 
including scientists, clinicians, industry, government, and patient 
advocates met for the workshop.
    The day and a half workshop was structured with plenary sessions 
for the first half-day followed by three Breakout Groups for 
facilitating discussions among the participants. The Breakout Groups 
were divided into the following areas: (A) Building a Knowledge Base--
Biology, Epidemiology, and Etiology; (B) Facilitating Clinical Studies 
in Rare Cancers; and (C) Development of New Detection, Prevention 
Methods/Strategies, and Therapies. On the second day, the moderators of 
each Breakout Groups presented a summary for discussion to all 
participants.
    All three Breakout Groups identified similar issues and challenges 
in the study of rare cancers and common themes for addressing these 
challenges. This report outlines the outcome of this workshop and the 
recommendations provided by the participants of this workshop: http://
rarediseases.info.nih.gov/RARE_CANCERS_
WORKSHOP/.

      RESEARCH CHALLENGES IN CNS MANIFESTATIONS OF INBORN ERRORS 
                         OF METABOLISM WORKSHOP

    On December 7 and 8, 2009, the Office of Rare Diseases Research, 
the National Institute of Neurological Disorders and Stroke and the 
Food and Drug Administration's Center for Drug Evaluation and Research, 
Division of Gastroenterology Products, hosted a workshop on the central 
nervous system (CNS) and inborn errors of metabolism, Research 
Challenges in CNS Manifestations of Inborn Errors of Metabolism. More 
than 150 participants attended the meeting to discuss the barriers to 
the development of therapies for central nervous system disease in 
inborn errors of metabolism (IEM). The conference focused on the 
challenges in clinical translation including the regulatory 
requirements to move from preclinical to the clinical stage of research 
and development, consideration of specific clinical trial design for 
rare diseases, the identification of appropriate outcome measures for 
evaluation of interventions, and ethical issues related to the 
investigation of products for these diseases.
    Additional meeting information can be found at: http://
www.rarediseases.info.nih
.gov/Inborn_Errors_Metabolism/AddContact.aspx.

              OPSOCLONUS MYOCLONUS SYNDROME (OMS) WORKSHOP

    The Opsoclonus Myoclonus Syndrome (OMS) Workshop was held on April 
10, 2010 at the Westin Harbour Castle in Toronto, Canada. Approximately 
35 researchers, patient advocates, and industry representatives from 
seven countries met along with several NIH representatives to discuss 
issues of importance to the OMS community, including the differences 
between pediatric OMS and adult onset OMS, therapeutic strategies in 
the United States and Europe, diagnostic criteria, current research 
activity and future directions. It was felt that there was enough 
agreement in several areas that consensus documents could be drafted. 
It is hoped that another OMS conference can be scheduled in 
approximately a year both to leverage the momentum from the first 
meeting into real collaborative progress in the OMS community and to 
fit better with the biennial meetings held in Europe. http://
rarediseases.info.nih
.gov/oms_workshop/.

                   ORDR SCIENTIFIC CONFERENCE PROGRAM

    ORDR collaborates with Institutes, Centers, and Offices at NIH to 
stimulate rare diseases research by cosponsoring scientific conferences 
where research is lagging or to take advantage of scientific 
opportunities. In 2009, ORDR co-supported over 90 conferences. This 
year, ORDR will co-support up to 50 conferences.
    Since the program inception in 1995 ORDR has co-supported almost 
1,100 conferences. For more information please visit http://
rarediseases.info.nih.gov/Scientific_Conferences.aspx.

                               ABOUT ORDR

    The Office of Rare Diseases Research (ORDR) was established in 1993 
within the Office of the Director of the NIH, the Nation's medical 
research Agency. Public Law 107-280, the Rare Diseases Act of 2002, 
established the office in statute. The goals of ORDR are to stimulate 
and coordinate research on rare diseases and to respond to the needs of 
patients who have any one of the almost 7,000 rare diseases known 
today.
    Definition of rare diseases: (Orphan Drug Act as amended in 1984 by 
P.L. 98-551 to add a numeric prevalence threshold to the definition of 
rare diseases.)
    ``. . . the term, rare disease or condition means any disease or 
condition which (a) affects less than 200,000 persons in the U.S. or 
(b) affects more than 200,000 persons in the U.S. but for which there 
is no reasonable expectation that the cost of developing and making 
available in the U.S. a drug for such disease or condition will be 
recovered from sales in the U.S. of such drug.''

        Response to Questions of Senator Enzi by John F. Crowley

    Question 1. Your industry is among the most innovative there is. I 
think when it comes to incentives for innovation in the area of rare 
and neglected diseases, we should take an ``all of the above'' 
approach, and try a variety of different mechanisms to encourage 
innovation. Can you weigh for me the pros and cons of different types 
of incentives, including prize funds?
    Answer 1. I agree completely regarding an ``all of the above'' 
approach relative to utilizing a variety of mechanisms to encourage 
continued innovation and entrepreneurship in the biotechnology and 
biopharmaceutical industries to develop medicines and devices to 
satisfy unmet medical need amongst those suffering from rare and 
neglected diseases.
    One of the key intentions of the Orphan Drug Act of 1983 was to 
encourage innovation in our industry by providing extended patent 
exclusivity and tax incentives to foster a new market dynamic. At this 
point now 27 years later, we need to reassess existing mechanisms, and 
to put in place a new series of incentives that will foster the risk 
taking and capital investments from private industry to develop a whole 
new generation of medicines to treat a range of rare and neglected 
diseases. Some possible mechanisms to consider include:

     The Therapeutic Discovery Project Tax Credit of $1 billion 
as provided in the Patient Protections and Affordable Care Act (PPACA) 
was a first step, utilizing tax credits intended to encourage 
investments in new therapies to prevent, diagnose and treat acute and 
chronic diseases by companies with 250 or fewer employees. The 
potential ``con'' to this is having the greatest number of potentially 
eligible applicants benefit from the funds rather than focusing on 
scientifically innovative projects. The final HHS/Treasury process may 
potentially dilute the funds allocated; reducing the likelihood of any 
particular project being awarded the resources it needs to have a 
significant impact. This tax grant program should be considered for 
extension and expansion beyond the current allotted 2009 and 2010 
credits/grants to the extent that it can leverage private capital and 
provide meaningful capital through the tax credit mechanism.
     Investment tax credits for angel and venture capital 
investors can provide incentives for those whose participation early on 
in the drug development process is essential to getting start-ups off 
the ground and compound identification and similar early drug discovery 
projects initiated. Capital markets have dried up in recent years and 
IPOs are no longer options for most biotechs. Investment tax credits 
could facilitate risk and encourage these important investment dollars 
early in the process, rather than later where they now are.
     R&D tax credits for drug discovery companies should become 
permanent, as an ongoing incentive. The United States has fallen behind 
because of foreign tax havens that other nations offer to attract drug 
manufacturing.\1\
---------------------------------------------------------------------------
    \1\ Gone Tomorrow? A Call to Promote Medical Innovation, Create 
Jobs, and Find Cures in America, Prepared for The Council for American 
Medical Innovation, June 10, 2010.
---------------------------------------------------------------------------
      SBIR--Small Business Innovation Research (SBIR) program grant 
eligibility rulings need to be changed, reverting to pre-2001 
definitions. Current requirements prevent small businesses that receive 
venture capital investment in excess of 50 percent from qualifying for 
these grants. SBIR eligibility should be restored to businesses reliant 
on VC financing. Both the House and Senate have passed a series of 
short-term extensions of SBIR in the past year, but no final 
reauthorization of the bill has been reached. It is again before the 
current Congress and should be passed this session.

    Question 2. In the late 1980s and early 1990s, Europe was approving 
new medicines faster than the United States. The medical product user 
fee programs turned that around, but I am hearing that the pendulum is 
swinging back the other way. Now that we have a solid foundation, what 
can we learn from the incentives in place in Europe?
    Answer 2. In the 1990s, national drug approvals, in general were 
taking variable lengths of time in Europe and there were rigid review 
clocks associated with these (perhaps the models for today's PDUFA 
clocks). Sponsors could seek approval in the EU nationally, by using 
the mutual recognition (decentralized) procedure or by using the 
centralized procedure. While the national route is now obsolete and 
there is the common EU route, a unified approval is not synonymous with 
unified access. Market availability of a medical product, i.e., 
reimbursement, is still very much determined on a country-by-country 
basis. Today, the rare disease community is advocating for ``no 
borders'' when it comes to accessing diagnoses and medical care at 
centers of excellence across countries. However, with diagnosis in one 
EU country, access to an approved drug is not guaranteed in another.
    In terms of the pendulum swinging, PDUFA has been widely credited 
as an innovative program that has strengthened FDA's capacity to 
evaluate expeditiously and efficiently the safety and effectiveness of 
new drugs and biologics, thereby making needed new safe and effective 
therapies available to patients in a timely and responsible fashion. 
However, recent FDA review data suggests that the Agency has been 
struggling to complete reviews in a timely manner. This drop in 
performance may be due in part to a lag in recruitment that coincided 
with additional workload from implementation of the FDA Amendments Act 
of 2007, but also calls for a thoughtful evaluation of the Agency's 
human drug review processes. Patients deserve a clear and predictable 
drug review process that is science-based, judicious, timely and one in 
which they can have confidence. We look forward to working with FDA and 
Congress to continue to strengthen the new drug review process and 
refocus on the original intent of the program: to provide the FDA with 
adequate resources to fulfill its essential public health mission of 
assuring the safety and effectiveness of new medicines.
    Lastly, the quality and completeness of sponsors' marketing 
applications matters in both the United States and in Europe. Sponsors 
across the board would serve themselves well by submitting well-
written, high quality applications. Seeking and applying guidance from 
the regulatory agencies throughout the process is important and can 
help with this.

    Question 3. Some have proposed a new division within FDA to 
evaluate therapies for rare diseases. While I think this approach has 
merits, I wonder if one set group could ever have the necessary 
expertise to address the thousands of rare diseases we hope to treat. 
Would a ``swat team'' approach where experts from other parts of the 
Agency are brought together on an as-needed basis be more efficient?
    Answer 3. A new division within the FDA dedicated to evaluating 
therapies for rare diseases is essential. One, discrete review division 
comprising expertise in rare diseases will enhance the Agency's ability 
to follow an orphan drug product application from its earliest stages 
through clinical trial design and implementation, data evaluation and 
final review and approvals. Organizing the best and brightest from rare 
disease science and medicine will result in a concentrated think tank 
that can establish its own organizational alignment, but not function 
within a vacuum. It will have an assembly of those who best understand 
myriad scientific and clinical elements of disease, drug development, 
trial design and analysis. And with time and a multitude of reviews, 
that collective body of knowledge will enhance as it progresses. Should 
additional knowledge or perspectives be needed, those can be drawn upon 
from elsewhere within NIH or from outside academic or medical 
institutions to augment a particular review process on an ad hoc basis, 
as the exception, however, rather than the norm.
    Currently, the Office of Orphan Product Development (OOPD) has 
limited long-term effect on any particular rare disease once an orphan 
designation is granted to a product. That product, and its potential, 
is handed back to the applicant; there is no direction or strategy 
beyond designation. OOPD staff become involved in the FDA review 
process only upon request and on a consultative basis. Presently, 
orphan product reviews are assigned across different review divisions 
at FDA. Expertise for particular rare diseases can build, during the 
course of a product's clinical trials and review period, if that 
disease assignment has been with a particular division for a while, and 
if a disease has more than one product indication under review. 
However, division assignments change and a group that reviews programs 
for a particular disease may be moved off that disease within just a 
couple of years' time. Staff turnover within these divisions also has 
been a significant hindrance. Expertise often leaves with those 
employees, necessitating training anew and impeding progress. Within 
the framework of one rare disease division, clear career development 
could be established, thereby attracting and retaining the talent that 
can both establish and evolve the evaluation process to most 
efficiently bring safe and effective treatments to satisfy unmet 
medical needs.

    Question 4. You use the term venture philanthropy in your 
testimony. This is a new concept to me, and I'd like to learn more. How 
does venture philanthropy compare to venture capital endeavors?
    Answer 4. Venture philanthropy initially applied to efforts that 
brought business or venture-oriented systems and processes to nonprofit 
organizations in the social service sector. Some examples of this 
concept include Venture Philanthropy Partners in Washington, DC, Social 
Venture Partners, throughout the United States, and the Acumen Fund.\2\ 
Now, more frequently, the term describes the efforts of patient 
advocacy and other nonprofit disease organizations to fund research and 
development in the commercial sector. It also refers to the activities 
by these advocacy groups who use business models to organize their 
activities.
---------------------------------------------------------------------------
    \2\ Venture Philanthropy: An Emerging Source of Capital for Drug 
Discovery and Development, Timothy Coetzee, Ph.D., Executive Director, 
Fast Forward, LLC, December 2008.
---------------------------------------------------------------------------
    They have taken more aggressive postures because they are 
frustrated with the typical pace of translational research in their 
respective disease areas. This is increasingly the case in the rare 
disease field, where the risk/reward profile for orphan product 
development is often viewed as a disincentive by the capital markets. 
In addition to their obvious passion for change, these venture 
philanthropists bring their financial resources, extensive disease 
knowledge, access to patient communities, and sometimes early registry 
data that emerging companies may not have. Venture philanthropists 
usually come in to the process at the second state of preclinical drug 
development: between drug discovery that often occurs at NIH and other 
academic institutions when a large number of candidates are identified, 
but before the clinical trial stage when the number of drug candidates 
has been narrowed to the select one or few and the capital markets and 
larger pharmaceutical companies' are ready to become involved. This 
translational research stage of ``valley of death'' has experienced a 
dearth of momentum and health venture philanthropy fills some of the 
void. We need to find additional ways to fill that void.
    The funding models used vary, and range from fairly straight 
forward grants or sponsored research agreements to convertible loans by 
private foundations, to equity arrangements that include company stock 
or royalties. Grants or research agreements can run from under $100,000 
to upwards of $50 million, or in the case of the Cystic Fibrosis 
Society (CF) and Vertex Pharmaceuticals, more than $100 million back in 
the middle of the last decade. Around that same time period, the 
Leukemia and Lymphoma Society allocated $3.5 million to Aegera for drug 
development and the ALS Association committed the same amount to 
Cambria Biosciences. In 2008, CF Foundation Therapeutics, Inc., the 
nonprofit affiliate of the CF Foundation, expanded its collaboration 
with PTC Therapeutics by committing an additional $25 million in 
support of the company's Phase 2 trials.

 Response to Questions of Senator Enzi and Senator Casey by Suerie Moon

                              SENATOR ENZI

    Question 1. My colleague here on the committee, Senator Brown, was 
involved in the development of an innovative incentive for developing 
therapies for rare and neglected diseases. Do you feel this type of 
non-exclusivity incentive is sufficient to entice more and bigger 
industry players into developing treatments for rare and neglected 
diseases?
    Answer 1. The Priority Review Voucher (PRV) is one mechanism to 
stimulate R&D for neglected diseases.\1\ While the PRV has the 
potential to increase innovation for rare and neglected diseases, an 
array of complementary policies is necessary to ensure effective and 
affordable new product development for neglected diseases, and the PRV 
is unlikely to be sufficient on its own, as explained further below.
---------------------------------------------------------------------------
    \1\ The PRV in the presently enacted form does not require non-
exclusivity though its original proposal did outline a structure in 
which the neglected disease drug developed would not be patent-
protected, and also in which manufacturing commitment was ensured. In 
the original conception of the PRV outlined in this article, a sponsor 
would need to meet the following conditions in order to receive a PRV: 
(1) treat designated neglected diseases; (2) receive approval from the 
United States or European drug regulatory authority; (3) be clinically 
superior to existing treatment options; (4) forgo patent rights; and 
(5) ensure at least one manufacturer. Ridley D, et al. Developing Drugs 
For Developing Countries. Health Affairs 25.2 (2006): 313-24, http://
content.healthaffairs.org/cgi/content/full/25/2/313.
---------------------------------------------------------------------------
    The PRV was introduced as part of the FDA Amendments Act of 2007 
(FDAAA) which amended the FDC Act to add  524: ``Priority Review to 
Encourage Treatments for Tropical Diseases.'' FDC Act  524 established 
a transferable priority review mechanism for drugs and biologics for 
certain specified tropical diseases. Drugs for qualified diseases 
approved by the Food and Drug Administration (FDA) are entitled to a 
PRV that allows for expedited review--of 6 months instead of the 
typical 10 months or more--of a drug or vaccine. The voucher is 
transferable, including by sale, and does not need to be applied to 
drugs in specified disease areas.
    As applied to neglected diseases, the PRV effectively provides an 
incentive estimated to be worth more than $300 million for the 
development of drugs for particular diseases.\2\ The transferability of 
the PRV to a producer of a blockbuster medicine makes this a 
potentially lucrative incentive for neglected disease development.
---------------------------------------------------------------------------
    \2\ Ridley D, et al. Developing Drugs For Developing Countries. 
Health Affairs 25.2 (2006): 313-24, http://content.healthaffairs.org/
cgi/content/full/25/2/313.
---------------------------------------------------------------------------
    While the PRV can be a useful tool if structured appropriately, it 
is insufficient on its own to stimulate new product development for 
neglected diseases, and as currently enacted also has several important 
shortcomings.
    First, PRVs leave to the company entirely the choice of diseases to 
prioritize for R&D. While current legislation identifies diseases for 
which the PRV may be applicable, it remains at the company's discretion 
whether to invest in drug development in these diseases. This means 
that priority diseases may be left unaddressed despite unmet needs.
    Second, the ability of the PRV to incentivize innovation of new 
neglected diseases R&D remains untested. While it is important to 
explore new approaches to incentivizing needs-driven R&D, new 
mechanisms should be designed carefully to maximize the public 
interest; they should also be monitored closely so that we learn from 
the experience and make improvements to policies along the way.
    In April 2009, the FDA granted the first PRV to Novartis for its 
combination anti-malarial medicine of artemether and lumefantrine 
(Coartem) although this medicine had been on the market many years 
prior: Novartis developed Coartem in 1996 and the medicine has been 
used, including by MSF, for more than a decade in developing countries. 
It had not previously been submitted to the FDA, but it had been 
submitted to and approved by other drug regulatory authorities. Whether 
companies will actually be motivated for neglected disease drug 
development by a transferrable PRV is not yet known and should be 
monitored closely.
    Third, the PRV in its current form does not ensure that products 
developed for neglected diseases are made available and affordable to 
patients in developing countries. The new incentive is not tied to 
agreements to license patents and other intellectual property rights in 
order to enable generic competition or more efficient procurement of 
products in developing countries.
    Fourth, the PRV is not available for re-purposed drugs, a possibly 
important area for the development of new treatments for neglected 
diseases.
    Proposed S. 3697 \3\ is legislation newly introduced by Senators 
Brownback, Brown, and Franken that responds to some of these problems. 
In particular, it would eliminate from eligibility for the PRV a drug 
approved more than 24 months prior outside of the United States for 
commercial marketing for tropical diseases. This would help to 
eliminate the possibility that a company would receive a windfall for a 
drug developed years earlier and it would reserve the PRV as an 
incentive for new drug development as intended. The act also expands 
the list of diseases eligible to benefit from the PRV to include Chagas 
disease. Chagas disease, the largest parasitic killer in the Americas, 
affects 300,000 in the United States and 15 million people around the 
world. The proposed amendment still would not require that a company 
ensure production, but it would expand the reporting requirements to 
include a good faith intent to make the drug available in developing 
countries.
---------------------------------------------------------------------------
    \3\ Creating Hope Act of 2010, or ``A bill to amend the Federal 
Food, Drug, and Cosmetic Act to improve the priority review voucher 
incentive program relating to tropical and rare pediatric diseases.''
---------------------------------------------------------------------------
    A variety of push and pull mechanisms are necessary to respond to 
the current lack of incentives for drug and vaccine development for 
neglected diseases. One of the reasons MSF supports delinkage 
principles generally, and innovation prizes in particular, to 
complement other mechanisms is that they can incentivize R&D without 
the limitations described above. A prize would bring attention to 
priority areas and could be structured to ensure affordability and 
accessibility principles.

    Question 2. Although rare and neglected diseases share some 
challenges, such as access issues, unlike rare diseases, neglected 
diseases have huge numbers of sufferers. Do the incentives for 
developing treatments for rare diseases carry over to neglected 
diseases? Which ones may not be applicable? Are there incentives for 
neglected diseases that may not be applicable to rare diseases?
    The primary incentives in the United States for the development of 
drugs to respond to rare diseases, with relatively few domestic 
sufferers, are established within the Orphan Drug Act (ODA). The ODA 
provides exclusive marketing protection, substantial tax benefits, 
grant support for R&D, and FDA counseling related to conditions for 
approval to the sponsor of a drug for diseases with fewer than 200,000 
domestic sufferers. The FDA reports that the ODA has incentivized the 
development and registration of more than 200 drugs and biological 
products to respond to rare diseases since the introduction of the act 
in 1983, compared to 10 in the decade before the introduction of the 
act.\4\
---------------------------------------------------------------------------
    \4\ U.S. Food and Drug Administration. Developing products for rare 
diseases and conditions, http://www.fda.gov/ForIndustry/
DevelopingProductsforRareDiseasesConditions/default.htm.
---------------------------------------------------------------------------
    The ODA incentive of exclusive marketing protection would be 
largely inapplicable to neglected diseases because exclusive marketing 
protection as an incentive relies on U.S. consumers being able to pay 
very high prices during a period of market exclusivity. It is debatable 
whether the exclusive marketing protection is even advisable for U.S. 
populations given the extraordinary prices charged due to the market 
exclusivity.
    Forbes Magazine recently explored the most expensive drugs, and 
identified nine that are priced at more than $200,000 per patient per 
year; most treat rare genetic diseases. ``For these diseases, there are 
few if any other treatments. So biotech companies can charge pretty 
much whatever they want.'' \5\
---------------------------------------------------------------------------
    \5\ Herper M. The World's Most Expensive Drugs. Forbes, Feb. 22, 
2010, http://www.forbes
.com/2010/02/19/expensive-drugs-cost-business-healthcare-rare-
diseases.html.
---------------------------------------------------------------------------
    The high prices of the treatments for these rare diseases create 
barriers and burdens for patients, employers, governments, or others 
who provide insurance or reimbursements for such treatments in the 
United States and abroad. But high prices are not the only problem of 
an incentive mechanism based on providing market exclusivity. Some 
companies use this exclusivity to delay the entry of competing products 
that may be better for some patients, or have superior delivery 
mechanisms.\6\
---------------------------------------------------------------------------
    \6\ See, e.g., Pollack A. Genzyme Drug Shortage Leaves Users 
Feelings Betrayed. New York Times, 15 Apr. 2010.
---------------------------------------------------------------------------
    Those affected by neglected diseases will not be able to compensate 
manufacturers through high drug prices. Similarly, companies will not 
be able to recoup R&D costs for drugs for neglected diseases through 
exclusive marketing and resultant high prices to these resource-poor 
consumers.
    Tax credits available through the ODA to incentivize drug 
development for rare diseases are equivalent to up to 50 percent of the 
cost of qualified investments in clinical testing of products. 
Insufficient information is available about how the tax credit is used 
in practice. Grant support to investigate treatments can be a useful 
push mechanism to subsidize R&D for both rare and neglected diseases.
    Incentives for neglected diseases that are based on delinkage, such 
as prizes, should work as well for rare diseases. While compensating 
for R&D at the outset, when appropriately structured, these incentives 
have the added benefit of minimizing access barriers. The few patients 
suffering from a rare disease will not be doubly burdened with health 
costs of hundreds of thousands of dollars annually for their lifetimes. 
Patients suffering from neglected or rare diseases would benefit from 
price-lowering generic competition or other cost control mechanisms as 
soon as a product is developed.

    Question 3. Innovation prize funds have been successful in 
aerospace and engineering fields. Are there any health-based funds that 
have awarded prizes for treatments?
    Answer 3. Over time, there have been a number of prizes for health 
care related innovations. For a comprehensive review of existing 
innovation prize funds through 2008, including for medical innovations 
but also for innovations in other areas, please see Selected Innovation 
Prizes and Reward Programs, by Knowledge Ecology International 
(KEI).\7\ Further information is available in the 2009 McKinsey Prize 
Report, ``And the winner is . . .'': Capturing the Promise of 
Philanthropic Prizes.\8\
---------------------------------------------------------------------------
    \7\ The information described below is largely drawn from this 
compendium. Knowledge Ecology International (KEI). Selected Innovation 
Prizes and Reward Programs, Research Note 2008:1, http://keionline.org/
misc-docs/research_notes/kei_rn_2008_1.pdf.
    \8\ McKinsey & Company, ``And the winner . . . ''; Capturing the 
Promise of Philanthropic Prizes, 3 Mar. 2009, www.xprize.org/about/the-
mckinsey-report.
---------------------------------------------------------------------------
    Prizes for medical innovations have been used since the 1800s to 
incentivize and/or reward R&D. There is tremendous variation in the 
prize amount, the specificity of the requirements for the prize to be 
awarded, and the level of development and utility required for the 
prize to be awarded.
    In the 19th century, a number of prizes were offered to advance 
medical science, including in particular prizes offered by various 
French academies, and British or U.S. scientific groups. Many among 
these focused on developments in tuberculosis treatment.
    More recently, Eli Lilly developed a program of small prizes to 
address discrete challenges that were part of larger efforts on drug 
development. This was later spun off as InnoCentive, a for-profit 
entity that currently manages hundreds of prize competitions, many of 
which involve biomedical inventions.
    Through InnoCentive, the Rockefeller Foundation offered a prize 
related to developments in tuberculosis research. This prize, like a 
number of others, was successful in inducing the desired innovation. In 
2007, for instance, the Gotham Prize was launched to reward the sharing 
of knowledge to accelerate progress in cancer research. The prize was 
used to reward a researcher $1 million for a new approach to cancer 
treatment; and to reward another $250,000 for developments in pediatric 
cancer.
    The following prizes have been used since the 1980's in the medical 
field:

     The Armand Hammer Cancer Prize (1981), offering $1 million 
for the scientist who found a cure for some form of cancer over the 
next decade;
     Rockefeller Prize (1994), offering a $1 million prize for 
developing a low-cost and efficacious test for gonorrhea or chlamydia 
useful in developing country contexts;
     InnoCentive (2001), a company established by Eli Lilly, 
hosted several prize funds for companies in need of scientific 
research; and expanded in 2006 with support from the Rockefeller 
Foundation including into the public health arena; prizes included in 
at least one instance an obligation that the awardee not patent or 
otherwise prevent the use of the innovation;
     Methuselah Mouse Prize (2003), offering a $4.5 million 
prize for research into aging;
     Project Bioshield (2004), a U.S. government-sponsored 
prize fund, provides for automatic payment for the development of 
bioterrorism countermeasures;
     Archon X-Prize for Genomics (2006), offering $10 million 
for genome sequencing developments;
     Prize4Life (2006), offering prizes for developments 
related to ALS (Lou Gehrig's disease);
     Hideyo Noguchi Africa Prize (2006), offering a 100 million 
yen (then approximately $860,000, now approximately $1.2 million) every 
5 years;
     Stop TB Partnership Kochan Prize (2006), offering a prize 
for achievements in combating tuberculosis;
     Gotham Prize for Cancer Research & Ira Sohn Conference 
Foundation (2007), offering annual rewards of $1 million and $250,000 
respectively for cancer and pediatric oncology, and described further 
above;
     Piramal Prize for Innovations that Democratize Healthcare 
(2007) offering 10 lakh rupee ($25,000) for health improvements 
benefiting the Indian poor; and
     InnoCentive Tuberculosis Prize for PA-824 (2007), offering 
a $20,000 prize funded by the Rockefeller Foundation, for a ``safe and 
economical synthetic route'' for a candidate drug for tuberculosis, and 
InnoCentive described further above.

    There have also been various unrealized proposals for medical 
innovation prizes in the United States and elsewhere. This includes the 
Medical Innovation Prize Act introduced in the U.S. Congress as H.R. 
417, 109th Congress; and S. 2210, 110th Congress. This legislation 
would establish a U.S. government-sponsored prize fund for drug 
development based on the medical or public health benefit of new tools 
developed. According to the proposed legislation, the prize would 
compensate for R&D for pharmaceuticals in place of patent exclusivity 
and monopoly prices, thereby allowing for price-lowering generic 
competition upon FDA approval rather than after patent expiry.
    From the historic experience of innovation prize funds, lessons 
have been learned about the importance of offering a sufficiently 
remunerative prize to compensate the R&D and appropriately value the 
objectives set out in the prize fund; permitting flexibility and the 
possibility of both interim ``milestone'' as well as end-stage rewards; 
and specifying with sufficient detail the desired end product, as well 
as including affordability and accessibility requirements.
    One lesson learned from the experience thus far is that prizes can 
generate private investment even exceeding the prize amount. The X 
Prize Foundation reports that the 26 teams competing for the $10 
million Ansari X Prize in aviation combined spent more than $100 
million to win the prize.\9\ As stated in the McKinsey Prize Report: 
``One of the prizes' great strengths is their ability to attract 
investments from competitors many times greater than the cost of 
delivering and awarding a prize.'' \10\
---------------------------------------------------------------------------
    \9\ See http://spacexprize.org/ansari-x-prize.
    \10\ McKinsey & Company, ``And the winner is . . . '': Capturing 
the Promise of Philanthropic Prizes, 3 Mar. 2009, www.xprize.org/about/
the-mckinsey-report.
---------------------------------------------------------------------------
    However, the funds dedicated to prizes have been quite limited. 
Whereas approximately $1 million has been made available annually for 
prizes to incentivize medical R&D, approximately $17-$20 billion has 
been made available annually to fund R&D through NIH grants while 
private sector R&D has been facilitated with the promise of substantial 
rewards, estimated at approximately $150 billion, earned through high 
prices paid by consumers.\11\
---------------------------------------------------------------------------
    \11\ Love J & Tim Hubbard. An Agenda for Research and Development. 
Lecture. Meeting on The Role of Generics and Local Industry in 
Attaining the Millennium Development Goals (MDGs) in Pharmaceuticals 
and Vaccines. The World Bank, Washington, 24-25 June 2003, 
www.cptech.org/ip/health/rndtf/lovehubbard06242003.doc.
---------------------------------------------------------------------------
                             SENATOR CASEY

    Question 1. Can you comment on the balance between public 
investment and private investment in finding cures for rare and 
neglected diseases?
    Answer 1. According to recent estimates, international financing 
for health-related R&D exceeds $160 billion and includes a diversity of 
sources: 51 percent private for-profit, 41 percent public, and 8 
percent private not-for-profit.\12\
---------------------------------------------------------------------------
    \12\ See Feletto M and Stephen Matlin. Global R&D financing for 
communicable and noncommunicable diseases: a report to the WHO Expert 
Working Group on R&D Financing, Oct. 2009, http://www.who.int/phi/
ewg3rdmeet/en/index.html. According to Feletto and Matlin's study: 
``The gap between LMIC [low- and middle-income country] relevant R&D 
and all health R&D is considerable.''
---------------------------------------------------------------------------
    Drug development for diseases where a profitable market exists--
i.e., because there are a significant quantity of people suffering from 
the diseases in upper income countries--generally relies on both public 
and private investment. Even highly profitable so-called 
``blockbuster'' drugs often benefit from significant outlays of public 
funds in the early stages of development.
    Typically, earlier stages of development, such as drug discovery 
and research, benefit from a high level of public funding, including 
both university research and research in government laboratories. 
Pharmaceutical companies generally focus private resources on the later 
stages of R&D.\13\
---------------------------------------------------------------------------
    \13\ Notably, this means that consumers typically pay twice. First, 
they pay through tax dollars for publicly funded early stage research. 
Then, where the research is transferred without obligations for 
affordability, the consumers pay through high prices during the patent 
term. In recent years, some universities and the National Institutes of 
Health (NIH) have begun to respond to concerns raised by various actors 
that the licensing agreements made to transfer university and public 
sector research to the private sector for subsequent development should 
include certain critical humanitarian terms.
    See, e.g., Universities Allied for Essential Medicines. 
Universities Allied for Essential Medicines, BIG VICTORY: 6 
Universities, AUTM and NIH Agree to Access Principles/Universities 
Allied for Essential Medicines, 11 Nov. 2009 (National Institutes of 
Health). Check E. Universities Urged to Do More for Poor Nations. 
Nature 444 (2006): 412-13. 22 Nov. 2006, (University of California at 
Berkeley). Kelbie P. Edinburgh University Forces Firms to Supply Cheap 
Medicines to Developing World. The Guardian, 26 Apr. 2009 (University 
of Edinburgh). Lin B. Rethinking Drug Development: A New Commitment to 
Global Access. UBC Public Affairs. University of British Columbia, 8 
Feb. 2010 (University of British Columbia).
    The transfer from the public sector to the private sector also 
comes without obligations for product development and accessibility.
---------------------------------------------------------------------------
    One of the primary differences between R&D for diseases which 
affect a significant number of people in high-income countries, and for 
rare and neglected diseases where the small number or great poverty of 
the afflicted does not suggest the likelihood of a profit, is whether 
private sector investment can be motivated by the promise of high 
profits from monopoly prices during the patent term.
    One study found, for instance, that in a 25-year period (1975-99), 
there were 179 drugs developed for cardiovascular disease whereas only 
16 drugs were developed for tropical diseases and tuberculosis (TB). At 
the time, both cardiovascular disease, and tropical diseases and TB 
represented a roughly equivalent global disease burden (11 percent and 
12 percent respectively), but R&D for tropical diseases and TB is 
underfunded because it disproportionately affects poor populations in 
developing countries.\14\ Few drugs used to respond to tropical 
diseases were even developed intentionally targeting these diseases or 
relying primarily on private funding.\15\
---------------------------------------------------------------------------
    \14\ Trouiller P, et al. Drug Development for Neglected Diseases: a 
Deficient Market and a Public-health Policy Failure. The Lancet, 22 
June 2002, http://www.thelancet.com/journals/lancet/article/PIIS0140-
6736(02)09096-7/fulltext.
    \15\ The two primary drugs for Chagas disease (benznidazole and 
nifurtimox), as well as the drugs for schistomiasis (praziquantel and 
oxamnaquine), and the drugs for helminth infections and onchoceriasis 
(albendazole and ivermectin respectively), were developed in the 
context of veterinary research. Maskalyk J. New Prescriptions for 
Neglected Diseases. pen Med. 1.2 (2007): 89-91, http://
www.ncbi.nlm.nih.gov/pmc/articles/PMC2802011; Trouiller P., et al. Is 
Orphan Drug Status Beneficial to Tropical Disease Control? Comparison 
of the American and Future European Orphan Drug Acts. Tropical Medicine 
& International Health 4.6 (2002): 412-20. Wiley Online Library. 5 Jan. 
2002, http://onlinelibrary.wiley.com/doi/10.1046/j.1365-
3156.1999.00420.x/full.
---------------------------------------------------------------------------
    The requirement of public sector investment in neglected disease 
research is apparent through looking at current clinical trials. The 
four diseases considered to be most neglected, which MSF prioritizes in 
our programming and which the World Health Organization (WHO) 
identifies as in need of innovative and intensified disease management 
(IDM),\16\ are Chagas disease, leishmaniasis, sleeping sickness (or 
human African trypanosomiasis), and Buruli ulcer. Each have a limited 
number of ongoing clinical trials, and all clinical trials are 
disproportionately funded by public funds, including the NIH, and/or 
universities or philanthropic organizations.
---------------------------------------------------------------------------
    \16\ World Health Organization, Neglected tropical diseases: 
innovative and intensified disease management (IDM), http://
www.who.int/neglected_diseases/disease_management/en/.
---------------------------------------------------------------------------
    There are seven reported ongoing clinical trials related to 
sleeping sickness; public, university or organizational funds support 
all seven while three have some industry funding. There is one ongoing 
clinical trial related to Buruli ulcer; it is publicly funded. There 
are 38 clinical trials related to Chagas disease; 29 are funded by the 
public sector, university or organizations, and 9 funded by industry. 
Lastly, there are 76 ongoing clinical trials related to leishmaniasis, 
but virtually all (73) are funded by the public sector, university or 
organizations; 7 receive some industry funding. For perspective, there 
are 243 ongoing clinical trials related to erectile dysfunction; 172 
receive industry funding.\17\
---------------------------------------------------------------------------
    \17\ This information was obtained through clinicaltrials.gov, a 
service of the NIH, on August 19, 2010, and may include some overlap in 
funding sources.
---------------------------------------------------------------------------
    Neglected diseases for which there is no or limited anticipated 
profitability require a higher level of public investment because the 
private sector will not be motivated by the possibility of exclusive 
marketing. The populations affected are unable to compensate drug 
development through high prices during the patent term because, even 
where they are numerous, they are too poor.
    Major benefits of public sector investment in health-related R&D 
are that (1) funds can be directed to identified public needs rather 
than areas of likely profit where the incremental health benefit is 
less substantial; (2) the cost of compensating R&D is not borne 
exclusively by the most vulnerable, i.e., afflicted patients, through 
out-of-pocket expenditures or insurance premiums, and the costs are 
dispersed rather than targeted at these patients alone; (3) public 
sector resources can be directed towards ensuring the accessibility of 
drug development even where the development is less profitable, i.e., 
ensure that R&D does not result in a product that does not reach the 
potential beneficiaries; (4) open source innovation models, in which 
new knowledge is shared, in real time to accelerate innovation and 
access, can be more easily implemented; and (5) public sector research 
may be more cost-effective and efficient than the patent system as an 
innovation tool as it has been estimated that U.S. taxpayers pay ``at 
least $150 billion per year in higher prices . . . to fund $20 billion 
in private sector R&D.\18\
---------------------------------------------------------------------------
    \18\ Love J & Tim Hubbard. An Agenda for Research and Development. 
Lecture. Meeting on The Role of Generics and Local Industry in 
Attaining the Millennium Development Goals (MDGs) in Pharmaceuticals 
and Vaccines. The World Bank, Washington, 24-25 June 2003, 
www.cptech.org/ip/health/rndtf/lovehubbard06242003.doc.
---------------------------------------------------------------------------
    Therefore MSF supports both public sector and private investment in 
both rare and neglected disease R&D, but recognizes the essential role 
that public sector funding plays in these areas. MSF also considers 
that a variety of push and pull incentive mechanisms are necessary to 
support R&D for these diseases. As explained, grants and NIH funding as 
push incentives are essential for the development of treatments, 
vaccines, and diagnostics for rare and neglected diseases. Pull 
incentive mechanisms are also necessary. MSF favors pull incentives, 
like prizes, that delink the cost of R&D from the price of the products 
and that do not rely on marketing exclusivities, for the reasons 
described above.

       Response to Questions of Senator Enzi and Senator Franken 
                 by Daniel A.C. Frattarelli, M.D., FAAP

                              SENATOR ENZI

    Question 1. Are existing incentives sufficient to support the 
development of therapies for rare diseases? How might these incentives 
be improved and increased?
    Answer 1. The development of therapies to treat rare diseases is 
challenging, and it is especially so in pediatrics. We must be 
constantly thinking of new and creative ways to incentivize more and 
better therapies. One area that needs specific attention is older, off-
patent drugs. Current incentives for pediatric and rare disease 
therapies can only offer added exclusivity to drugs that are still 
protected by patents and marketing exclusivity. Many off-patent drugs 
lack pediatric safety and efficacy data and the National Institutes of 
Health (NIH) has worked to identify many of these gaps in pediatric 
therapeutics. However, there are no existing incentives available to 
remedy this problem. We look forward to working with Congress to 
explore new policy solutions to increasing the number of these older 
drugs studied for the benefit of children.

    Question 2. Some of the incentives available for pediatric and rare 
and neglected diseases are stackable--a business can get more than one 
for a given product. Do the different programs work well together? 
Could they be more coordinated?
    Answer 2. The orphan drug exclusivity provided by the Orphan Drug 
Act and the pediatric exclusivity offered by the Best Pharmaceuticals 
for Children Act (BPCA) work well together to improve access to safe 
and effective drugs for children and patients with rare diseases. The 
Orphan Drug Act incentivizes the development of drugs for rare diseases 
and BPCA incentivizes the study of drugs in pediatric populations. 
Pediatric exclusivity under BPCA is only granted in response to 
fulfilling the requirements of a written request issued by FDA and is 
not given in conjunction with any other incentive program.
    Both incentive programs are necessary and serve distinct purposes. 
Whereas BPCA may be used to add pediatric labeling information to a 
popular adult drug, the Orphan Drug Act may be used to incentivize the 
development of that same drug to treat an entirely different condition 
that classifies as a rare disease.

    Question 3. You recommend a central repository for data on rare 
conditions so that fragments of data do not reside with different 
physicians. We have a database called ClinicalTrials.gov that could be 
used for such a purpose. Do you think this is a possible way to do what 
you suggest?
    Answer 3. ClinicalTrials.gov is a useful tool now available to 
patients, providers, and researchers to share and disseminate 
information on ongoing clinical trials. This can be particularly 
helpful for families that cope with rare diseases and are desperately 
seeking treatment. The unique nature of rare and pediatric disease 
research, however, may require specially designed data sharing networks 
not currently in place.

    Question 4. What more can be done to speed the diagnosis of rare 
disorders?
    Answer 4. The National Organization for Rare Disorders (NORD) has 
been a leader for decades in the effort to increase information on the 
diagnosis and treatment of rare disorders. More investment into 
activities like these will be necessary to continue to improve the 
standard of care. There is much we do not yet know about rare 
disorders, but we must make sure that what we do know is readily 
available to patients, families, and providers. We need more outreach 
to primary and specialty care physicians, medical societies, and 
medical schools. Newborn screening also plays an important role in the 
early diagnosis of rare disorders and deserves our continued support.

                            SENATOR FRANKEN

    Question 1. The FDA has recently appointed a point person for 
oversight of orphan drug development in FDA's Center for Drug 
Evaluation and Research's Office of New Drugs. This appointment seems 
like a positive step. Do you think establishing a similar ombudsman for 
Orphan and Pediatric Devices in the FDA's Center for Devices and 
Radiological Health would encourage innovations and development of 
medical devices for these populations?
    Answer 1. The Center for Devices and Radiological Health (CDRH) is 
currently in the process of hiring a Chief Pediatric Medical Officer 
who will report directly to the CDRH Director. This Chief Pediatric 
Medical Officer will be tasked with coordinating and integrating 
pediatrics across the center. The American Academy of Pediatrics 
strongly supports this move.
    Similar efforts to integrate pediatrics in the Center for Drug 
Evaluation and Research (CDER) have been successful. The Pediatric and 
Maternal Health Staff and the Pediatric Review Committee (PeRC) have 
helped standardize high quality pediatric research across the review 
divisions of CDER and Center for Biologics Evaluation and Research 
(CBER). The Office of Pediatric Therapeutics in the Office of the 
Commissioner continues to do excellent work coordinating pediatric 
efforts across the centers at FDA.

    Question 2. You mention in your testimony that physicians often 
don't recognize many of these diseases because they are so rare. What 
can we do to help physicians to get the best information to diagnosis 
and care for these patients?
    Answer 2. The National Organization for Rare Disorders (NORD) has 
been a leader for decades in the effort to increase information on the 
diagnosis and treatment of rare disorders. More investment into 
activities like these will be necessary to continue to improve the 
standard of care. There is much we do not yet know about rare 
disorders, but we must make sure that what we do know is readily 
available to patients, families, and providers. We need more outreach 
to primary and specialty care physicians, medical societies, and 
medical schools. Newborn screening also plays an important role in the 
early diagnosis of rare disorders and deserves our continued support.

    [Whereupon, at 12:19 p.m., the hearing was adjourned.]