Economic Considerations of Rare Disease Treatments Explored in Analysis Group–Coauthored Article
March 24, 2025
Cutting-edge treatments can improve health outcomes, quality of life, and health care resource utilization among patients with rare diseases. However, the high costs and uncertainty associated with the development of these treatments, coupled with the small patient population for any given rare disease, can weaken economic incentives for companies to innovate. Additionally, novel therapies often come with high prices that can make them inaccessible to some patients. Policymakers who seek to balance patient access to rare disease treatments with incentives for developing them should keep certain economic principles in mind when developing prescription drug pricing policies.
To achieve this goal, Analysis Group Vice President Yao Lu and Manager Molly Frean coauthored an article with an academic researcher describing how economic incentives can impact pharmaceutical innovation and access. In the article, the authors outline some unintended consequences of broad-based pricing controls, detail alternative pricing and financing policy approaches, and provide insight into legal implications related to pricing and access for rare disease treatments. They conclude that “policymakers, litigators, and regulators should carefully consider the unique economics of rare disease treatments, and the substantial benefits they offer, as they continue to assess potential tradeoffs and to develop policies on pharmaceutical pricing and accessibility.”
The article, "Lawmakers Shouldn't Overlook Rare Disease Therapies' Value," was published in Law360.