Policy wins:
Priority Review Vouchers Re-Authorized

Policy wins:
Priority review vouchers re-authorized

Darzalex and Vyvgart (like Revlimid before them) highlight effective orphan life-cycle management and defense tactics. They are also among the highest-profile beneficiaries of IRA-related policy wins for orphan drugs in 2025. (See: IRA Gets More Orphan Friendly).The start of 2026 brought another important policy win, likely to benefit many more orphan drug developers. The Rare Pediatric Disease Priority Review Voucher (PRV) program, which awards faster FDA review times to sponsors of products for rare childhood conditions, was re-authorized through September 2029. PRV awardees can use the vouchers for another drug program, or sell them on, sometimes for up to $100 million or more. The program provided strong incentives to rare drug developers and investors but had expired at the end of 2024 (meaning no new designations, though approvals were set to continue through September 2026).

PRV awardees can use the vouchers for another drug program, or sell them on, sometimes for up to $100 million or more.

When President Trump’s new (and different) National Priority Voucher scheme emerged in June 2025, promising expedited reviews for any drugs deemed to address “national health priorities”, many feared the rare diseases-focused program would fall by the wayside. In February 2026, however, the Rare Diseases Voucher program re-emerged within broader US government funding legislation that ended a partial government shut-down¹. This same legislation also clarified the scope of orphan drug exclusivity - the seven years’ protection that orphan developers enjoy before a competing drug for the same condition can be approved. Rather than blocking the same drug being approved for the “same disease or condition”, exclusivity now blocks only same drugs seeking approval for the “same approved indication or use within such rare disease or condition”. In practice, FDA had long interpreted exclusivity on this narrower basis, but the amendment formalizes that. It deters legal challenges (which FDA has faced in the past) and leaves room for multiple players across a given disease. There was less clarity around regulatory treatment of cell and gene therapies. FDA in March 2025 removed the Risk Evaluation and Mitigation System (REMS) safety requirements for CAR-T cell therapies, deemed to have become an unnecessary administrative burden. But it may impose stricter trial requirements on the category, including head-to-head studies to prove superiority over available therapies, per a December 2025 JAMA perspective piece². Messaging around gene therapies and drugs for ultra-rare conditions has been similarly mixed; several gene therapy candidates have hit regulatory setbacks, despite prior communications interpreted by sponsors as supportive (See: Mixed messages from FDA).An unpredictable FDA puts an even greater premium on clear, compelling data. That is particularly hard to achieve for those developing drugs for rare diseases.

IRA Gets More Orphan Friendly

The biggest orphans benefit from two tweaks to the 2022 Inflation Reduction Act (IRA), designed to curb Medicare spending for high-cost drugs.

Until July 2025, only single-indication orphan drugs were exempt from IRA price negotiations, which can shave 40% or more off prices for US Medicare (government-funded health coverage for over-65s⁸). Darzalex has at least nine approvals; sub-cutaneous Darzalex Faspro, launched in 2020, recently collected its sixth, as part of a quadruplet regimen in newly diagnosed, transplant-ineligible patients. Biologics costing Medicare more than $200 million a year are vulnerable to IRA negotiations after 13 years. By 2032, it will be almost 20 years since the IV form of J&J’s CD38 antibody was first approved.

Yet Darzalex (and others) will now escape IRA price cuts thanks to a July 2025 tweak that expanded orphan exemptions to include multi-indication drugs. This change, enacted through President Trump’s One Big Beautiful Bill Act, also helps orphan drugs that collect subsequent approvals in non-orphan indications. That’s because the timeline for price negotiations now begins only after the first non-orphan approval, rather than on the date of the first orphan approval, as was the case before the amendment.

This is significant. Many developers gain initial approval in an orphan indication before expanding into larger markets, for clinical and commercial reasons. The original IRA rules threatened that strategy: few sponsors would have taken the risk of initially launching in small indications a drug candidate with potential across far larger diseases. This may have delayed or scuppered some orphan treatments.

September 2025 brought another policy win for subcutaneous biologics like Darzalex Faspro and Vyvgart Hytrulo. The Centers for Medicare and Medicaid Services (CMS), which implements IRA, deferred in final IRA guidance a proposed change around fixed-dose combination biologics⁹.

Under initial IRA guidance, biologics co-formulated with hyaluronidase to increase drug dispersion and absorption in tissues are treated as fixed-dose combinations. This means, for negotiation purposes, such products are considered separately from their IV counterparts. It’s a moot point for (so far) orphan-only franchises, exempt anyway. But if non-orphan indications follow – as for best-seller biologics like Keytruda QLEX or Herceptin Hylecta – this tactic becomes a valuable tool to delay eligibility. In May 2025, CMS proposed updating the policy to group fixed-dose combinations containing therapeutically inactive ingredients, like hyaluronidase, together with the original product for negotiation purposes.

The proposed change was not adopted.