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Table 1 The input parameters for current and early timing of price negotiations

From: The impact of early phase price agreements on prices of orphan drugs

Model parameter    Remarks
Cost of development (US$ million) US$701 million €660 million Not specific for orphan disease or orphan drugs in oncology
Cost pre-clinical US$217 million €205 million  
Phase I US$84 million €79 million  
Phase II US$142 million €134 million  
Phase III US$190 million €168 million  
Phase IV US$68 million €64 million  
Years of development & approval 8 years   
Net patent life 12 years   
Population Western markets: 947.1 million   
  Larger global market: 1743.4 million   
Period between registration and reimbursement 1.5 years   Based on increasing hurdles, especially for high priced orphan drugs (reimbursement) + pricing negotiations
Net patent life 12 years   
Uptake 80% from first year   Uptake is higher in orphan diseases than other drugs
Cost of revenue 40%   
Probability success
 Phase I to II 70%   
 Phase II to III 39%   
 Phase III to approval (FDA/EMA) 69%   
 Reimbursement 90%   Based on increasing hurdles, especially for high priced orphan drugs (reimbursement) + pricing negotiations
 Cost of capital 12%