The European orphan drug market is growing and is already comparable in size and scope to the US market. The European Union (EU) counts 36 million rare disease patients, and the European market is projected to reach $80.56 billion by 2032, up from $44.64 billion in 2024. That would be a compound annual growth rate of 7.66%.

This growth is fuelled in part by rising prevalence of rare diseases and advancements in personalised medicine. In addition, the EU has incentisized companies to develop rare disease products. Since 2000, 231 rare disease products given orphan designation have been authorised for marketing in all member European states.

The EU grants orphan designation if a product is intended for the diagnosis, prevention or treatment of a life-threatening or chronically/seriously debilitating condition. These conditions affect no more than 5 in 10,000 people in the EU.

In part because of how typical rare diseases are (just over 7,000 have been identified globally), in many cases the EU has not authorised a satisfactory method of diagnosis or preventative treatment for them.

A vetted treatment such as a medicinal product existing elsewhere, however, will significantly benefit those affected and their caretakers. This potential offers plum opportunities for US companies to intervene with orphan products in the EU4.

For successful entry into European markets, biotechs need to focus on finding patients, and the importance of real-world data. Key to these is working with patient association groups, finding medical centers of excellence and leveraging disease registries. Establishing relationships with these groups and clinicians ensures the appropriate introduction of a company’s product through viable access routes, according to each country’s regulations and proven needs for a new rare disease product. These relationships also present an opportunity for the real-life, observational data capture that is becoming increasingly important to payors for reimbursement.

However, medicines in Europe are regulated at both European and national levels, for example all orphan drugs must be approved through a centralised procedure, but then local regulations will apply when selling drugs in each member state. This can be both an opportunity and a challenge for biotech firms looking to expand. US biotech companies must develop a nuanced approach to understand the specifics of each system and tailor their strategies accordingly.

The new EU-wide health technology assessment (HTA) HTA process as of January 2025 for oncology medicines and other advanced therapy medicinal products will extend to orphan drugs in 2028. The reports will not be legally binding, with national HTAs expected to take the Joint Clinical Assessments into “due consideration” when reaching their overall conclusions on drug value. Joint Clinical Assessments will focus on the relative clinical and safety effectiveness, while national HTAs will build on this by looking at the clinical and safety evidence alongside the economic (and potentially other) impacts within their own health systems. The new processes went live recently, so we expect this to be an evolving space and recommend keeping a close eye on if and how requirements change.

Digging into the European market

It is crucial to enact early phase engagement. Through clinical data gap analysis reviews and assessment of different authorisation pathways and qualification criteria, companies can prioritise and simplify European entry.

For example, it is necessary to research specific country customisations. Product packaging needs to respect individual country specifications for blue-box labelling and drug leaflet production needs to be customised for language differences (although some ultra-rare products may benefit from a qualified language translation exemption by the EMA). Different countries may also have disparities in aspects such as expiration date formats and serialisation numbers.

All products manufactured outside Europe must undergo EU Import Testing, and all drugs must be Qualified Person (QP) released onto the market to confirm they are fit for purpose and have been processed to meet Current Good Manufacturing Process (CGMP) standards.

How the European market operates: the example of early access programs

Unlike the US, the EU does not operate as a single standardised market. Instead, it functions as 27 individual markets—each with their own unique characteristics, regulatory landscapes and healthcare systems.

Via early access, an individual healthcare system can support and fund treatment before European Medicines Agency (EMA) approval. As many as 18 European countries follow their own national procedures regarding early access, while others align with EMA guidelines. Some have no framework at all for early access, and several which are not part of the EU are treated such, including Norway and Switzerland. In most countries, clinicians are liable for outcomes, but others hold pharmaceutical companies responsible.

Pharmaceutical companies need to evaluate whether to impose charges or offer the early access program for free, depending on their strategies, the specific program type, and the regulatory pricing policies in the respective countries. The ability to charge for early access products is dictated by the product’s global license status, i.e., if no other market has an approved product, some countries will require the product to be provided free of charge.

Of course, it is a choice for the manufacturer whether they actually want to charge or not. Care needs to be taken when considering charging for early access products, as some countries, such as France, will expect a refund on the early access price if the eventual approved commercial price is lower.

The EU’s new Joint HTA process as of January 2025 for oncology medicines and other advanced therapy medicinal products will extend to orphan drugs in 2028. The reports will not be legally binding and national HTAs will still decide for themselves on whether to use the joint assessment report or ask for additional clinical evidence to judge for themselves. It is still very early days in terms of how this will all work in reality. By 2030, JCAs will be carried out on all medicinal products and should be clearer. so perhaps keep an eye on both the old and new ways of assessment.

The benefits of launching with a European partner

Entering the European market with an orphan drug program requires a deep understanding of national-level variations in regulatory approvals, pricing, and reimbursement. US biotech companies can benefit greatly from partnering with specialist providers who have extensive experience managing programs across multiple European markets. In these partnerships, the biotech company contracts with a specialist provider to help market the drug, without any transfer of ownership rights.

Early engagement with companies that understand the nuances of local languages, cultures, licensing, and regulations can help US companies to navigate key market entry barriers, such as compliance with country-specific Health Technology Assessments (HTAs) and securing pricing agreements. In addition, to succeed within individual EU states, it is essential to employ somebody who understands how the product will be viewed compared to competitors, its effectiveness as a new treatment, and what the local health economy is willing to pay.

The local specialist team can manage the practical elements of early access programs; commercial discussions at national, regional, and local levels; and logistical support.

Specialist partners also help companies maximise pricing opportunities and mitigate risks associated with delayed reimbursement. They offer insight and guidance on country-specific market access, pricing and reimbursement, and pharmacovigilance needs. In some countries, companies may be able to engage with one partner, but in others, they may need to work with multiple smaller players to ensure nationwide coverage.

Partners should conduct a thorough analysis of a company’s commercial strategy and a regulatory assessment of the countries they are interested in entering. This work may span a range of areas, including offering advice on the type of early access program most suited to match company goals, whether it can be charged for or not, and what data is likely collectible.

Patient mapping should be undertaken to understand the points at which the patient interacts with their local health economy; feedback should be sought from payors, regulators and local patient organisations about how the product should be introduced, how it will be received and to gain understanding of how it may be used compared to existing products and the potential price points the product may be able to achieve.

Recommendations should be made about phasing of countries for entry to ensure there is no price erosion as the product is launched from one country to the next; advice on the realistic timelines for pricing and reimbursement negotiations should be made clear.

A good partner should also have experience handling specialised storage and transportation requirements that may be unique to orphan drugs, as well as connections to patient advocacy groups and rare disease foundations.

Summary

While successfully bringing an orphan drug into the European market can seem daunting, is both achievable and potentially highly rewarding for US biotech companies. To maximise success, companies must carefully plan their regulatory, pricing, and market access strategies early in the process. Partnering with a dedicated provider can help navigate the complex approval pathways, country-specific pricing negotiations, and reimbursement hurdles that can delay or limit market entry. Additionally, establishing efficient distribution networks and supply chain logistics is crucial for seamless product availability across multiple European countries.

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