Drugs for treating rare diseases had been neglected by the pharmaceutical industry for a long time, due to the complex and costly drug R&D process as well as a small unprofitable market. Since its introduction in 1983, the Orphan Drug Act (ODA) has sought to prompt the innovation of drugs for minority diseases by reducing the regulatory and economic barriers. The incentives of the ODA have been effected through market protection, tax credit, fee waiver and grants to increase the accessibility of orphan products for the public. The number of orphan drugs available in the market has risen sharply from just ten in the decade before 1983 to over 400 since 1983. This increase implies a substantial improvement of the healthcare of patients suffering rare diseases and a success of the orphan drug legislation with the aim to motivate the development and manufacture of products that have low commercial potentials. Although it is evident that the ODA has successfully stimulated drug companies to develop numerous orphan products, treatments are very expensive. The sales of blockbuster orphan drugs have provided drug companies with unusually highprofit margins and limited patient access to treatments. The dilemma presented by the ODA reflects many of the issues currently faced by policymakers. In this thesis, we have analyzed the long-term evolution of the biopharmaceutical industry. In particular, we have examined drug discovery in the period of random screening, rational design and network collaboration, and explored the influence of the ODA. We have taken the theory of the sectoral system of innovation, and combined it with the complex adaptive model of innovation, and found that the complex version of that theory is capable of explaining the comprehensive drug innovation system. A Multi-agent Based Model has been introduced to identify and analyze the dynamics of bio-pharmaceutical innovation. The model has explored the roles of the main players in the sector and the influence of their relationships embedded in the process of orphan drug innovation. Through this model, we have investigated the mechanisms of how the incentives stimulate orphan drug innovation during the period from 1983- 2012. Moreover, the model has been applied to solve the dilemma of the ODA through analyzing how to achieve the best trade-off between orphan drug developments. Drawing upon the results of the simulation, we provide a sound basis for adjusting the ODA incentives to strikes an appropriate balance between stimulating orphan drug innovation and providing benefits to society, propose some resolutions to the ODA, while also to motivate orphan drug development in a financial way. The Advice for other countries planning to enact the orphan drug legislation and directions for further research suggested by this model have been put forward.

It is the purpose of this thesis to develop a course of study for pharmacy schools on drug regulation by the Food and Drug Administration (FDA). A summarization of the history of the development of the Food and Drug Administration (FDA) and of pharmacy education reveals a lack of interface between the two. The necessity for the interface of pharmacy education and the agency which has significant control over the products forming the basis of the pharmacy profession will be made apparent. A period of residency through which the course of study on drug regulation by the FDA was to be developed, will be described. This description details the responsibilities and functions of the various segments of the FDA involved in the regulation of drugs as acquired through discussion with agency officials during the residency. It is intended to be used as the textual material for the didactic portion of the course of study to be offered at schools of pharmacy. Based upon the experience, recommendations will be made regarding the applicability of the course of study to include possible residencies for pharmacy students at the agency.