Sign up for our daily briefing

Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on the day's biggest business stories

Subscribe to Axios Closer for insights into the day’s business news and trends and why they matter

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Stay on top of the latest market trends

Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sports news worthy of your time

Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tech news worthy of your time

Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Get the inside stories

Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Denver news?

Get a daily digest of the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Des Moines news?

Get a daily digest of the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Twin Cities news?

Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Tampa Bay news?

Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Charlotte news?

Get a daily digest of the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!
Expand chart
Data: FDA and I-MAK; Table: Naema Ahmed/Axios

Some of the best-selling drugs in the U.S. have stacked up extra federal protections that were initially intended to spark research into drugs that couldn’t make money on their own.

Why it matters: Some experts fear that these additional protections could help shield blockbuster drugs from cheaper competitors.

How it works: Federal law gives drug companies an extra incentive to research treatments for “orphan” diseases — conditions that affect fewer than 200,000 people and thus don't present a compelling business opportunity for drugmakers.

  • If a drug treats an orphan disease, it can get 7 years of additional market exclusivity, free from generic competitors, for that use.

By the numbers: 6 of the 8 best-selling biologic drugs in 2017 have orphan approvals, and 3 — Humira, Rituxan and Avastin — still have extra exclusivity for some of those uses.

Between the lines: Most of these drugs don’t yet face competition from biosimilars — which are similar to generics, but aren’t automatically interchangeable at the pharmacy counter.

  • Some experts fear, however, that even once there’s a competitive biosimilars market in the U.S., these orphan approvals will give biologics a leg up — even though these orphan approvals don't legally bar biosimilars from competing on other uses.
  • “I think it really is all about...being able to maintain your market share for the orphan indication as well as the indication for which your product is being used…it just might make it less likely that competitors come onto the market,” Vanderbilt's Stacie Dusetzina said.

The other side: Drugmakers say that’s not the case.

  • "These exclusivities will not prevent Humira biosimilars from entering the market. In fact, biosimilars will enter the market for the non-orphan indications two years before the latest Humira orphan-designated indication exclusivity expires," said MK Steel, a spokeswoman for AbbVie, which makes Humira, the world’s best-selling drug.
  • "We’re proud to have studied [Remicade] in orphan indications. These are small populations with large unmet need," said Linda Davis, a Janssen spokeswoman, adding that all of Remicade's orphan exclusivity periods have expired.

In the end, it’ll be up to insurance companies and providers to decide whether an orphan approval makes a biologic more desirable than a biosimilar, even for the non-orphan uses that drive most sales.

  • “It may be giving already marketed drugs a commercial advantage...but that’s why we have payers and [pharmacy benefit managers]. They're supposed to be negotiating,” Food and Drug Administration Commissioner Scott Gottlieb said.

What’s next: Some critics say drugs that are already raking billions shouldn’t be able to rack up so much extra protection in the first place. And change may be coming.

  • “For a drug that’s already on the market, maybe you don’t need as much incentive to study a subsequent indication," Gottlieb said. "Maybe we make the designation harder to get.”
  • “I think with these big established drugs, there needs to be a streamlined way of giving enough incentive for it to be used in a smaller population, but not necessarily the system that we have now," said Ted Okon, executive director of the Community Oncology Alliance.

The bottom line: “These are examples of drugs where the financial returns absolutely appear to be there," Dusetzina said. “They’re not meeting the spirit of the law, even if they’re technically meeting the letter of the law.”

Go deeper

U.S. ambassador to Russia will return home briefly: State Department

John Sullivan, U.S. Ambassador to Russia, during a briefing in Moscow in 2015. Photo: Anton Novoderezhkin/TASS via Getty Images

The State Department said Monday that the U.S. ambassador to Russia, John Sullivan, will now be returning to the United States this week before returning to Moscow "in the coming weeks."

Why this matters: The statement, from a State Department spokesperson, comes just hours after Axios reported that Sullivan had indicated he intended to stand his ground and stay in Russia after the Kremlin “advised” him to return home to talk with his team.

Scoop: Leaked Ukraine memo reveals scope of Russia's aggression

Russian President Vladimir Putin visits a military exposition in Sevastopol, Crimea, in Jan. 2020. Photo: Mikhail Svetlov/Getty Images

Russia has been holding last-minute military exercises near commercial shipping lanes in the Black Sea that threaten to strangle Ukraine's economy, according to an internal document from Ukraine's ministry of defense reviewed by Axios.

Why it matters: With the eyes of the world on the massive buildup of troops in eastern Ukraine, the leaked memo shows Russian forces escalating their presence on all sides of the Ukrainian border.

Elon Musk: Autopilot feature wasn't enabled in fatal Texas crash

Photo: Patrick T. Fallon/Bloomberg via Getty Images

Tesla CEO Elon Musk tweeted on Monday that "data logs recovered so far" show the car's Autopilot feature was not enabled — and it did not have access to "full self-driving mode" — in the deadly crash in Texas involving the company's electric vehicle.

Background: Local investigators said they believed the car was operating without anyone in the driver's seat. At the time of death, one man was in the passenger seat, while another was in the rear seat, KPRC 2 reports.