In Japan, pharmaceutical products can be given orphan drug designation by the Ministry of Health, Labor and Welfare (MHLW). A high medical need must exist for the product, and there must be no available alternative treatment. The drug must also be safe and efficacious and have less than 50,000 cases. However, designation of an orphan drug does not mean that it will automatically be given drug marketing approval.
Japan offers a variety of incentives to support development of orphan drugs and medical devices. Manufacturers can receive subsidies, less costly consultations with Japan’s regulatory agencies, preferential tax treatment, reduced requirements for clinical trials, lowered review and validation fees, priority review for marketing authorization and longer marketing exclusivity period.
Japan’s Orphan Drug Development Program has enabled many domestic and foreign orphan drug developers to enter the Japanese market. For orphan drug designations in Japan to date, close to half of the drug developers are non-Japanese companies. This demonstrates the success of foreign companies in Japan at receiving orphan drug approvals.
However, the orphan drug designation and orphan drug marketing approval processes in Japan take significantly longer than these processes take in other advanced countries. In Japan, orphan drug designation and marketing approval take an average of 4.5 years longer than each process takes in the U.S. Furthermore, Japan has approved fewer than 20% of the orphan drug products that have been approved in the U.S.
One explanation for these lags is that the Japanese government often waits until the chances of successful product development are higher before designating an orphan drug. Japan has granted designation to only 1/10th the number of orphan drugs as have been given orphan designation in the U.S. However, Japan has gone on to approve almost two-thirds of orphan designated drug products. In comparison, the U.S. has approved approximately 17% of orphan designated drug products.