What is the Creating Hope Act?
The Creating Hope Act, championed by Kids v Cancer and passed into federal law in 2012, created the pediatric rare disease priority review voucher program. The rare pediatric disease priority review voucher program incentivizes the pharmaceutical industry to develop drugs for children with cancer and other life-threatening illnesses. The first voucher was awarded in 2014. The Creating Hope Act was reauthorized in 21st Century Cures Act in December 2016 and as a part of the Stimulus package in December 2020. The reauthorization is not permanent, and the Creating Hope Act sunsets (expires) in 2024. We are working hard on a permanent reauthorization of the Creating Hope Act.
What is a voucher?
A priority review voucher is an incentive program established by Congress and administered by the Food and Drug Administration to encourage development of treatments for rare pediatric diseases. Priority review voucher is awarded to a drug company if the company develops a drug for a rare pediatric disease and the drug is approved. The voucher allows the company to expedite the FDA review of a future drug. The company may sell the voucher to other companies that want to expedite drug reviews.
What is the purpose of priority review vouchers?
Priority review vouchers are an incentive for drug companies to develop drugs for rare pediatric diseases. A disease is rare if it affects fewer than 200,000 Americans. All childhood cancers are rare. The goal of vouchers is to create new treatments developed specifically for kids and to increase the number of new treatments for rare diseases in kids.
Why the Creating Hope Act is needed?
Drug development is a long, costly, and financially risky process. A company must secure funding from investors, pay researchers and scientists, and conduct pre-clinical and clinical trials. All of these activities must be funded before a company knows if a drug will be approved. Creating drugs for rare diseases takes the same effort as for other diseases but is often less profitable — markets are smaller and accrual costs may be higher.
Since 1980, the FDA has approved only four new drugs for treatment of childhood cancer, compared to dozens for adults.
How is a priority review an incentive and who pays for it?
A drug company spends on average 7-10 years creating a new medicine, and then submits an application to the Food and Drug Administration for approval. There are different speeds of FDA review. A “standard review” takes 10 months. A “priority review” is 6 months. A company that develops a rare pediatric disease drug receives a voucher upon FDA approval of that drug, receive a voucher. The voucher comes with rights to a priority review for a drug that would only merit a standard review. The extra time is valuable to a drug company, as the new drug will reach the patients sooner and may beat a competitor’s drug to the market. Companies may also sell the vouchers to other companies. Thus, the value of the voucher, which is now around $100 million per voucher, is funded by the company that purchases the voucher and is not funded by tax payers.
How does the voucher process work?
There are 3 steps:
1. A company must develop a treatment for a rare pediatric disease and request a voucher.
2. The FDA must approve the treatment and the voucher request. Upon approval, the FDA issues a voucher to the company.
3. The company may exercise the voucher or sell it to another company. Exercise of the voucher enables a company to receive a priority review for any drug that would otherwise have received a standard review. Vouchers have been selling for around $100 million.
Are the priority review vouchers effective?
Yes. In the 20 years before the enactment of the Creating Hope Act, FDA approved only two drugs that had been developed specifically to treat a pediatric cancer: Erwinase and Clofarabine. Since 2014, when the first voucher was issued, 22 new drugs for rare diseases in kids have been approved, including two drugs for childhood cancers.
Many vouchers have been sold, creating almost $4 billion in sales – a powerful incentive for the companies. Executives of pharmaceutical companies have expressed their interest in earning a voucher and have said it is a valuable incentive. And it has not cost patients or taxpayers a penny.
Drug companies are developing more drugs for rare pediatric diseases than before. During drug development process and prior to submitting a new drug application and requesting a voucher, companies apply to FDA for the rare pediatric disease designation (and/or other designations, such as orphan drug, breakthrough therapy, fast track, etc). The number of applications to FDA for rare pediatric disease designation – a signal from drug companies developing drugs for kids that they are interested in earning a voucher -- has been rising steadily. (Not every drug that receives a rare pediatric disease designation will be approved, and the designation is not a guarantee of the voucher award.)
What new drugs earned a voucher? How many vouchers have been sold and at what price?
The first rare pediatric disease (RPD) priority review voucher was awarded in 2014, two years after the Creating Hope Act was passed into law. Since then, a total of 40 pediatric vouchers have been awarded (as of October 2021). The vouchers have been selling for about $100 million. See the list of issued and sold vouchers here.
Legislative history of the voucher program
The Creating Hope Act voucher is based upon a neglected tropical disease priority review voucher program that was signed into law as a provision of the Food and Drug Administration Amendments Act of 2007. The tropical disease voucher program is permanent.
The Creating Hope Act was passed into law in 2012 as part of Food and Drug Administration Safety and Innovation Act, Public Law 112–144, Title IX, Sec. 908, Rare Pediatric Disease Priority Review Voucher Incentive Program. The vouchers awarded for development of drugs for rare pediatric diseases constituted 61% of all FDA-issued vouchers since then.
By enacting the Creating Hope Act pediatric voucher program – the Rare Pediatric Disease Priority Review Voucher Program, 21 U.S.C. 360ff Sec. 529— Congress created a market incentive for the development of drugs for rare pediatric diseases.
On December 13, 2016, President Obama signed into law the 21st Century Cures Act, reauthorizing the Creating Hope Act until September 2020. The U.S. Senate passed the 21st Century Cures Act and with it, reauthorization of the Creating Hope Act pediatric priority review voucher program, voting 94-5. Thank you to our sponsors, Congressmen G.K. Butterfield, Michael McCaul and Chris Van Hollen, and Senators Bob Casey and Johnny Isakson, for their commitment to children with cancer and other rare diseases. Thank you to the FDA for executing this critical program.
Pursuant to the 21st Century Cures, the Creating Hope Act pediatric voucher was reauthorized until September 20, 2020. Moreover, drugs that receive rare pediatric designations by that date would qualify for vouchers as long as they are approved by September 20, 2022.
In December 2020, the Creating Hope Reauthorization Act of 2019 was passed by Congress, extending the program for four more years.
We are working on making the Creating Hope Act permanent.
FDA Draft Guidance for Industry
In July 2019 FDA updated its guidance on the Creating Hope Act Priority Review Vouchers, entitled: Rare Pediatric Disease Priority Review Vouchers, Guidance for Industry, which the agency initially issued in November 2014.
For companies developing pediatric rare disease drugs:
The criteria for a Rare Pediatric Disease Product Application leading to a pediatric voucher are that a drug or biological product:
Is for the prevention or treatment of a Rare Pediatric Disease;
Contains no active ingredient that has been previously approved in any other application;
Is submitted under section 505(b)(1) of this Act or section 351(a) of the Public Health Service Act;
Itself qualifies for priority review;
Relies on clinical data derived from studies examining a pediatric population and dosages of the drug intended for a pediatric population.
The term “rare pediatric disease” means a disease that is a serious or life-threatening disease in which the serious or life-threatening manifestations primarily affect individuals aged from birth to 18 years.
The Creating Hope Act provides for a rare pediatric designation process to create greater certainty earlier in the drug development process that a drug or biologic would qualify for a voucher, should it be approved. The request for a rare pediatric designation can be made at the same time or after a request for an orphan designation is made.
For companies wishing to exercise a voucher
A sponsor who wishes to exercise a priority review voucher would likely have a large-market adult drug or biologic that would otherwise be reviewed by the FDA pursuant to a standard review. By exercising a priority review voucher, the sponsor would then be able to receive a priority review for that drug or biologic. This would get the drug or biologic to market more quickly, perhaps ahead of a similar competing drug or biologic, thereby generating significant value.
The priority review voucher program does not alter the criteria for a FDA approval. Drugs subject to priority review must still conform to all the FDA requirements to be approved.
A sponsor of a drug or biologic application that is the subject of a priority review voucher shall pay a user fee. The amount of the user fee shall be based on the difference between the average cost incurred by the FDA of a priority review and the average cost incurred by the FDA of a standard review. This amount shall be adjusted annually to reflect current costs. For fiscal year 2021, which starts October 1, 2020, the fee for exercising a priority review voucher was reduced to $1,360,879 from FY2020 fee of $2,167,116, a further reduction from $2,457,140 fee in FY2019.
The Creating Hope Act provides that the sponsor must notify FDA of its intent to submit a drug application with a priority review voucher at least 90 days prior to submission. The user fee shall be due upon the notification.
Pursuant to the Creating Hope Act, the FDA may revoke a priority review voucher awarded if the Rare Pediatric Disease Product Application for which such voucher was awarded is not marketed in the United States within a year.
GAO reports
The Government Accountability Office has produced two reports on priority vouchers, including rare pediatric disease vouchers. The first report, published in March 2016, was titled “Too Early to Gauge Effectiveness of FDA's Pediatric Voucher Program.” It stated: “Given that the typical drug development process often exceeds a decade, insufficient time has elapsed to determine whether the 3 year-old program has been effective.
The second report, titled “Drugs Development: FDA’s Priority Review Voucher Programs”, was published in January 2020. It states: “All 7 drug developers we spoke to indicated that the vouchers were a factor in their decisions.” Drug companies “indicated support for their reauthorizations, with some noting that voucher program expirations may negatively affect overall drug development and the willingness of drug sponsors to work in these areas.”