The calculus for determining whether an indication is worth pursuing is probably determined more by 1) potential pricing and 2) translational risk than by total number of patients, tax incentives or added exclusivity, although shorter clin development requirements are hugely important
If the translational risk is high (i.e. what works in mice / other disease models prob won't work in humans), the probability of success approaches zero. So the expected value approaches zero. It doesn't matter how many patients there are, the magnitude of the unmet need or how nice the molecule is if it isn't effective.
With a high enough price, you can get a billion-dollar drug from a few hundred patients. Avexis, which was acquired by Novartis for $8.7B, had a lead drug targeting Type 1 SMA, which has only a few hundred patients worldwide. If they charge $2M / patient (which they might) it only takes 500 patients for $1B annual revenue. Of course they were pursuing other indications, had other development projects and had valuable manufacturing assets so the $9B wasn't all for that one indication, but a lot of it was
And while $2M is prob high, the reason they can get away with even tossing out prices like that is that their drug is a potential cure for a disease that kills 90% of affected infants before 2 years of age. potential cure in that it has only been studied in a few dozen patients (thanks to ORphan drug act shorter cook studies) and that patients haven't been followed more than a few years, so who knows how durable the treatment is
Is a medicine that adds 70 years to someone's life worth $2M? What about 40 years? 10? 5? Hard to know.
If the translational risk is high (i.e. what works in mice / other disease models prob won't work in humans), the probability of success approaches zero. So the expected value approaches zero. It doesn't matter how many patients there are, the magnitude of the unmet need or how nice the molecule is if it isn't effective.
With a high enough price, you can get a billion-dollar drug from a few hundred patients. Avexis, which was acquired by Novartis for $8.7B, had a lead drug targeting Type 1 SMA, which has only a few hundred patients worldwide. If they charge $2M / patient (which they might) it only takes 500 patients for $1B annual revenue. Of course they were pursuing other indications, had other development projects and had valuable manufacturing assets so the $9B wasn't all for that one indication, but a lot of it was
And while $2M is prob high, the reason they can get away with even tossing out prices like that is that their drug is a potential cure for a disease that kills 90% of affected infants before 2 years of age. potential cure in that it has only been studied in a few dozen patients (thanks to ORphan drug act shorter cook studies) and that patients haven't been followed more than a few years, so who knows how durable the treatment is
Is a medicine that adds 70 years to someone's life worth $2M? What about 40 years? 10? 5? Hard to know.