Rare diseases: an overwhelming economic scenario
28 February 2024

Rare diseases (RDs) are a heterogeneous group of 10,867 known severe, chronic, degenerative, disabling, and often genetic life-threatening conditions, according to a report by RARE-X [1]. By definition, a rare disease affects no more than 1 in 2,000 people in Europe [2]. Due to the low prevalence of each disease, medical expertise is rare, knowledge may be scarce, care offerings inadequate, and research limited [3].

Yet, are rare diseases truly as rare as their name suggests? Despite their low prevalence, these diseases collectively impact nearly 400 million people worldwide, with approximately 30 million affected in Europe [4]. Scientific evidence also highlights similarities in terms of risk factors, multi-target therapeutic approaches, clinical experiences, and care journeys for patients with RDs [5]. Fortunately, rare diseases have increasingly been recognized as a public health priority. The multi-year diagnostic odyssey experienced by many RD patients imposes a significant socio-economic burden on individuals living with these conditions, their families and caregivers, healthcare systems, and society as a whole [1 - 2].

Non-medical costs for people with rare diseases

People living with a RD and their families often encounter significant financial challenges, which can persist throughout their lives, especially considering that half of the patients with RDs are children [4 - 5].  Although there have been attempts to assess the economic burden of RDs over time, identifying and evaluating the costs associated with RDs still remains a challenge for various reasons. First, there is often a lack of primary and/or aggregated data [6]. Second, most RDs lack a specific International Classification of Disease (ICD) code [7]. Last, the majority of cost-of-illness (COI) analyses are specific for diseases and countries; mostly from a societal perspective, usually using prevalence-based estimations and collecting data retrospectively and directly from patients or from clinical charts. Thus, current studies are not truly reflecting the complexity of all RDs and their impacts [2, 6].

However, there is a general consensus that the economic burden of RDs is driven by indirect and non-medical costs paid by families, which, when combined, exceeds the direct medical costs, largely borne by commercial payers [2, 7]. According to The National Economic Burden of Rare Disease Study in the United States in 2019, the first of its kind to provide a comprehensive assessment of the total economic burden of a large group of diseases (379) in a single year, RDs impose significant costs to individual households. Quantitatively, the estimated total indirect cost of RDs is $437 billion, of which $46 billion are for children and $391 billion for adults. These costs are mainly due to productivity losses associated with absenteeism ($149 billion) and presenteeism ($138 billion) by patients and family caregivers. The total non-medical cost is $73 billion, with the average of $12,310 for children and $4,007 for adults, due to spending on paid daily care, necessary home modification (e.g., ramp), special equipment at home/vehicle (e.g., wheelchair) or special education (mainly for children), typically paid out of pocket. RDs also impose significant indirect and non-medical costs to the government in the U.S. The estimated costs to government supplemental income programs that provide disability support to people with RDs is roughly $115 billion [7]. 

Medical costs for people with rare diseases

In addition to this, people with RDs and their families can experience difficulties in covering the increasing costs of care [8]. There are few studies that compare medical costs for people who do and do not have a rare disease. In the pilot IDeaS study led by the National Institutes of Health’s National Center for Advancing Translational Sciences (NCATS) in 2021 [9], it was estimated that direct medical costs per patient per year (PPPY) of 14 representative RDs within 4 different healthcare systems (HCS) databases exceeded by approximately three to five times costs for non-rare diseases patients of the same age, suggesting that RDs have high medical burdens to patients and HCS [10]. A result corroborated one year later by Chiesi Global Rare Diseases, with support from IQVIA, through an economic evaluation for a sample of 24 rare diseases across five therapeutic areas, according to which the burden of RD care is approximately tenfold higher than mass market diseases on a PPPY basis. Moreover, the lack of treatment for most RDs is associated with a 21.2% increase in total costs PPPY [11]. 

A similar conclusion also emerged from the study led by the EveryLife Foundation and Lewin Group, according to which the total direct medical cost is $449 billion, where hospital inpatient care and prescription medication are the two largest cost categories [7]. The financial burden placed on families due to the escalating costs of caring for rare conditions is a significant factor. The diagnostic challenges associated with undiagnosed, misdiagnosed, or untreated rare diseases can lead to additional direct medical expenses - including multiple diagnostic tests, unnecessary medical appointments, and other interventions - and also indirect costs [9].

Once a diagnosis is made, only a small proportion of patients is eligible for exemption, an aspect of particular importance when considering the use of off-label drugs, due to severely limited treatment options for RDs, as research and development are not prioritized and economic incentives are considered insufficient to attract investment into rare diseases [5, 12]. According to the EveryLife Foundation’s study, total healthcare cost not covered by insurance is $38 billion in the U.S. [7]. 

Investment in diagnostics tools 

While the lack of specific therapies and the high costs associated with managing RDs are significant contributors to the economic burden, investing in advanced diagnostic tools can be a key strategy to mitigate these costs. 

By enabling earlier and more accurate diagnoses, it is possible to reduce unnecessary medical procedures, facilitate access to potential therapies and provide valuable data for research and development. 

This approach to managing the economic burden of RDs not only alleviates the financial strain on families and healthcare systems but also improves the quality of life for individuals living with these challenging conditions.

Investment in RDs is gaining momentum, paralleled by research progress. Recent findings have demonstrated that the integration of Next Generation Sequencing (NGS) into routine clinical practice can significantly enhance patients' access to diagnosis for RDs and reduce the reliance on cross-border collaboration among national health systems [13 - 14]. Achieving a comprehensive understanding of RDs in Europe, along with a uniform assessment of their socioeconomic impact, necessitates striking the right balance in terms of policies and incentives to foster innovation that directly benefits RD patients [2, 16].

Written by Emanuela Passarelli


[2] Delaye, J., Cacciatore, P., & Kole, A. (2022). Valuing the "Burden" and Impact of Rare Diseases: A Scoping Review. Frontiers in pharmacology, 13, 914338.


[4] RARE Disease Facts - Global Genes. Global Genes Rare Disease Facts. Accessed December 29, 2021,


[6] García-Pérez, L., Linertová, R., Valcárcel-Nazco, C., Posada, M., Gorostiza, I., & Serrano-Aguilar, P. (2021). Cost-of-illness studies in rare diseases: a scoping review. Orphanet journal of rare diseases, 16(1), 178. 

[7] Yang, G., Cintina, I., Pariser, A., Oehrlein, E., Sullivan, J., & Kennedy, A. (2022). The national economic burden of rare disease in the United States in 2019. Orphanet journal of rare diseases, 17(1), 163.

[8] The Lancet Diabetes Endocrinology (2023). Rare diseases: individually rare, collectively common. The lancet. Diabetes & endocrinology, 11(3), 139.


[10] Tisdale, A., Cutillo, C. M., Nathan, R., Russo, P., Laraway, B., Haendel, M., Nowak, D., Hasche, C., Chan, C. H., Griese, E., Dawkins, H., Shukla, O., Pearce, D. A., Rutter, J. L., & Pariser, A. R. (2021). The IDeaS initiative: pilot study to assess the impact of rare diseases on patients and healthcare systems. Orphanet journal of rare diseases, 16(1), 429. 



[13] The Lancet Neurology (2022). Rare diseases: maintaining momentum. The Lancet. Neurology, 21(3), 203.

[14] Vinkšel, M., Writzl, K., Maver, A., & Peterlin, B. (2021). Improving diagnostics of rare genetic diseases with NGS approaches. Journal of community genetics, 12(2), 247–256.