Following the “Uber Model” to Repurpose Drugs for Value Added Success

Our recent participation in the European Repurposing 4 EU conference in Barcelona highlighted significant challenges and opportunities in the development and commercialization of repurposed drugs, particularly within the EU and U.S. markets. This post explores how advanced technologies—especially those leveraging artificial intelligence (AI)—can transform the value proposition for repurposed drugs, with a focus on regulatory, reimbursement, and distribution strategies enabled by the 505(b)(2) pathway in the U.S.

Repurposing approved active pharmaceutical ingredients (APIs) for new indications is often viewed unfavorably in major pharma markets. In the EU, the predominance of single-payer systems and the absence of a legal framework for re-approval of existing APIs create substantial barriers to investment and market access. Despite these limitations, innovative research continues to identify genetic targets and therapeutic opportunities for rare diseases, frequently powered by AI-driven technologies.

However, the "repurposing" narrative can hinder investment, as it is perceived as lacking novelty or commercial viability. This is especially true in markets where reimbursement is tightly controlled and regulatory pathways for repurposed drugs are underdeveloped.

To overcome these challenges, it is essential to shift the narrative from simple “repurposing” to “value added innovation.” Advanced platforms—often incorporating AI or other technology—can identify novel disease targets, elucidate mechanisms of action, and match existing APIs to new therapeutic opportunities. These technologies provide multifaceted value, analogous to how Uber leverages technology to optimize the use of existing vehicles, transforming them into a differentiated service rather than merely repurposing taxis.

Unlike the EU, the U.S. market offers a distinct legal pathway for repurposed drugs via Section 505(b)(2) of the Federal Food, Drug, and Cosmetic Act (FFDCA). This pathway allows sponsors to rely on existing data for approved APIs, streamlining development and reducing costs. Key advantages include:

• Ability to file for new indications, formulations, or combinations using previously approved APIs.

• Opportunity to secure new patents for technology-enabled innovations, linking novel mechanisms or uses to the API.

• Distinct product identity and labeling, differentiating the new product from the original and avoiding classification as a mere line extension.

• Enhanced reimbursement status, with value-based pricing that exceeds generic API benchmarks.

• Linkage with appropriate technology can obtain expedited review status.

For rare and orphan indications, products may qualify for seven years of market exclusivity under the Orphan Drug Act, further protecting against generic competition.

Specialty pharmaceutical products developed through technology-enabled repurposing can leverage alternative distribution channels, often bypassing major wholesalers. These products are typically utilized in tertiary care settings, allowing sponsors to minimize rebate obligations and tailor distribution to unique patient populations.

Technology platforms can also support outsourcing of pricing, reimbursement, and administrative functions, streamlining market access. Early engagement with payers is facilitated by the focus on rare and orphan diseases, enabling sponsors to build a reputation for reasonable pricing and responsible stewardship.

The U.S. regulatory environment permits sponsors to focus on technology-driven innovation, "Ubering" their way to success by creating differentiated, high-value products from existing APIs. By leveraging the 505(b)(2) pathway and orphan drug incentives, sponsors can achieve reasonable pricing, robust returns on investment, and sustainable market exclusivity.

Repurposed drugs, when paired with advanced technology platforms and strategic use of regulatory pathways, can deliver significant clinical and commercial value. The key is to reframe the narrative—emphasizing added value through innovation, differentiation, and patient impact—while navigating the regulatory and reimbursement landscape with precision.