Introduction

The debate over financing for rare diseases^[a] in India is in the news. On 9 October 2025, the Delhi High Court declined to restrain Natco Pharma from selling a low-cost, generic version of Risdiplam, an oral therapy for spinal muscular atrophy. Roche, the innovator company, has since sought urgent relief from the Supreme Court.^[1]  In a parallel development, on 7 November 2025, the Supreme Court heard the Union government’s appeal arising from the Delhi High Court’s judgment directing the government to establish a ‘pooled’ national fund to finance the treatment of rare diseases. The Supreme Court took submissions and set a final hearing in March 2026. The Bench did not issue any interim directions on financing, leaving patients and families with no immediate relief.^[2] These episodes show how patent litigation, pricing, and access collide in real time, and why India now needs faster policy action across high-cost therapies for rare diseases.

Indeed, rare diseases pose a structural challenge for India’s health system. Diagnostic pathways are often delayed, and available therapies are frequently priced at levels that are not affordable without third-party support. As treatment options are limited, families encounter uncertainty about eligibility, timing, and continuity of care. India’s population size implies that while each condition affects a relatively small proportion of individuals, the aggregate is large enough to strain clinical capacity and public finance. At the same time, not all rare diseases entail very high-cost medicines; a subset—particularly many inborn errors of metabolism—can be managed primarily through medical nutrition therapy and specialised diets when these are supplied consistently.

Foundational policy elements have been put in place over the recent years, with the National Policy for Rare Diseases (NPRD), 2021, taking the lead. NPRD assigned roles in the management of rare diseases to the Centre and the states, notified Centres of Excellence (CoEs) across the country to anchor referral and treatment, and established a national registry of rare diseases, hosted by the Indian Council of Medical Research (ICMR) and intended to support epidemiology, procurement decisions, and outcomes tracking. Recent duty and tax revisions have contributed to reducing certain transaction costs, while some states have begun to experiment with price discovery and procurement scale.

Over the last five years, ORF has tracked the evolution of policy and practice within the domain of rare diseases. Its findings indicate that these measures do not yet operate as an integrated financing system. Though the basic components are present, they are yet to be organised into a predictable pathway that families, clinicians, and payers can navigate over multiple years. In February 2021, ORF identified persistent blind spots in financing and argued for an orphan-drug pathway.^[3] In July 2022, a special report assessed whether affordability, domestic research, and manufacturing could move NPRD, 2021, from intent to implementation.^[4] In September 2025, ORF analysed case-level data on the government crowdfunding portal and documented a wide gap between indicated need and actual mobilisation. ^[5] It is clear that though India now has the core instruments in place, the task is to connect them into a predictable financing pathway.

This report draws on proceedings from a roundtable co-hosted in September 2025 by ORF and the Organization for Rare Diseases India (ORDI).^[6] It situates those discussions within current policy instruments, judicial orders, parliamentary proceedings, and peer-reviewed literature. It argues that policymakers must balance distributive equity with fiscal stewardship in a setting where evidence is still evolving. The policy problem is not only whether to finance care, but how to determine priority, duration, and renewal in a way that can be defended administratively and clinically.

Policy Journey and Current Financing Architecture for Rare Diseases in India

The 2017 National Policy for Treatment of Rare Diseases (NPTRD) outlined a framework that combined a Central and state corpus for treatment of rare diseases, an ICMR-hosted registry, accredited centres for diagnosis and care, and affordability measures, including duty relief and pricing tools. However, in December 2018, the government placed the policy in abeyance after acknowledging two binding constraints: an absence of agreement with states on cost sharing, and uncertainty about the fiscal space for very high-cost tertiary care.^[7] The subsequent NPRD, 2021, preserved NPTRD’s system-building objectives while narrowing its fiscal commitments.

NPRD, 2021, delineates three groups of rare diseases for financing and access. Group 1 conditions—diseases amenable to one-time curative treatment—receive capped Central support through designated CoEs. The cap was initially set at INR 20 lakh and later expanded to INR 50 lakh per eligible patient. Group 2 conditions—which require lower-cost, lifelong therapy—are to be primarily supported by states. Meanwhile, the treatments for high-cost, Group 3 cases are to be supplemented by a digital crowdfunding portal that formalises voluntary individual and corporate contributions credited to hospital rare-disease accounts.^[8]  These funding measures are supported by the ICMR’s National Registry for Rare and Other Inherited Disorders (NRROID), launched in 2019, which is intended to enable prioritisation, inform procurement, and support outcomes-linked renewal across these groups.^[9]

In addition, two fiscal measures under the NPRD target price rather than coverage. On 30 March 2023, the government granted full basic customs duty exemption for all rare-disease drugs and Foods for Special Medical Purposes imported for personal use.^[10] In September 2025, the GST Council reduced the GST on most medicines to 5 percent and set GST to 0 percent for a set of life-saving drugs, including for a number of them relevant to rare diseases.^[11]

Price and Coverage

Price and coverage are distinct policy variables that should be treated separately. Actions like customs duty exemption and GST revisions reduce transaction prices but do not decide who is financed, for how long, or on what terms. Similarly, centralised procurement in coordination with states and confidential discounts can lower effective acquisition prices, expanding treatment durations, yet these measures do not establish eligibility or continuity of care.

In terms of coverage, the operative baseline is set at the INR 50-lakh cap for Group 1 diseases. Parliamentary replies have confirmed that beyond this amount, financing is not a Central responsibility and depends on state-level action and philanthropy.^[12] The result is unevenness—one state may secure managed therapy courses, while a neighbouring state faces interruptions due to procurement calendars, budget timing, or variable donor flows.

Policy documents and peer-reviewed literature converge on the centrality of registries for rare-disease pricing and coverage.^[13] The national registry (NRROID) can inform and link price to coverage decisions on the frontline. The NRROID platform, for instance, can support prioritisation toward indications with stronger evidence of benefit, enable health technology assessment and managed-access contracts based on real-world outcomes, and permit price or renewal adjustments when measured value diverges from expectations.

Policy Shortfalls and Judicial Responses

Parliamentary responses have consistently described the current boundaries of Central support for rare diseases at the INR 50-lakh cap for financial assistance. They point specifically to the government’s crowdfunding portal to address any residual financing gap.^[14]

The crowdfunding platform, however, although it confers legitimacy and provides an auditable route to hospital accounts, lacks features that drive sustained giving, limiting its own scope. Narrative presentation and social proof are limited, recurring contributions are not standard, and pathways for CSR and FCRA donors are less clear than on mature private crowdfunding platforms. As a result, outreach is modest when compared to private platforms that routinely raise several crores for single beneficiaries.

Publicly available data points to the quantum of the shortfall. On 2 October 2025, the Digital Portal for Crowdfunding and Voluntary Donations for Patients of Rare Diseases listed 12 CoEs and 3,965 registered patients, with a rotating list of patients marked as ‘urgent’.^[15] ORF’s September 2025 analysis aggregated the annual requirement values shown for the listed patients at roughly INR 9,100 crore per year in treatment requirements. This is set against cumulative donations of about INR 3.9 lakh since the portal’s launch in 2021. The portal, expected to be a supplement to public finance rather than a substitute, thus functions merely as a listing of verified cases rather than a realistic funding channel.^[16]

The current momentum to address these limitations in rare diseases policy is primarily catalysed by judicial action. The rare-disease funding litigation in the Delhi High Court began as a series of petitions in 2020 led by Master Arnesh Shaw v. Union of India, seeking uninterrupted treatment and a predictable public-financing pathway. After multiple interim orders, the Delhi High Court issued a detailed judgment in October 2024, directing the Union government to establish a National Fund for Rare Diseases and to provide pathways for financing beyond the INR 50-lakh cap. Following this, in December 2024, the court recorded that the judgment had been stayed by the Supreme Court, pending appeal. The judgment nevertheless describes a governance architecture that the executive can adopt voluntarily.^[17]

During the pendency of these proceedings, there have been reported deaths of petitioners and other rare-disease patients who have exhausted current support and were awaiting more, underscoring how judicial or administrative delay can be fatal for time-sensitive therapies.^[18]  Stakeholders have also noted that, under court supervision, a central committee led by ICMR engaged multiple companies on price, and that while discounts were reported, opacity and the later stay created uncertainty that argues for transparent governance if a pooled fund proceeds.^[19]

State Responses

State models demonstrate implementable approaches without waiting for a national pooled procurement system. Kerala, for example, has started utilising the Kerala Medical Services Corporation Ltd to tender and centrally procure drugs for rare diseases.^[20] This centralised procurement anchors price discovery and stabilises supply, improving clinician planning and reducing emergency purchases at premium prices.^[21] Meanwhile, Goa has notified a Pricing Policy for Innovative and Life-Saving Therapies in August 2025 that enables confidential negotiated pricing for cancer and rare-disease therapies. The policy keeps list prices for tenders while reducing the state’s effective acquisition price through credit notes or goods supplied, improving coverage within a fixed budget.^[22] Rajasthan, for its part, has launched RajSambal, a state-run crowdfunding portal that channels donations through official systems.^[23] Although philanthropy cannot underwrite continuity at scale, the state plans to move towards premium-backed fund pooling to expand the INR 50-lakh cap and reduce interruptions.^[24]

A Pragmatic Blueprint for the Way Forward

India has most of the elements needed for a functioning financing system for rare diseases, guided by NPRD, 2021. Predictable renewal pathways, however, are the current imperative—clinicians have pointed to instances in which short-lived courses, including in Duchenne muscular dystrophy, produced little benefit when continuity failed.^[25] Moreover, domestic manufacturing and voluntary access programmes by pharmaceutical companies can expand availability, but neither substitutes for predictable pooled finance coupled with price governance.

The immediate task therefore is to organise existing parts into a predictable pathway and to define operational rules that make them reliable for patients and providers, while also focusing on promotional activities. India should anchor coverage in a pooled Central–state fund with explicit continuity rules, temper prices through nationally negotiated corridors paired with managed-access agreements, and route multi-year CSR finance to support defined cohorts. Limited insurance hybrids, backed by a small emergency bridge at each CoE, can protect patients from administrative gaps. Together, these steps would move the system towards sustained operation and give families a clear and accountable promise of care.

Building on the discussions at the ORF-ORDI roundtable, supplemented by further analysis, this report makes the following recommendations:

1. Establishing a pooled Centre–state fund with explicit continuity rules. The Union government should operationalise the National Fund for Rare Diseases architecture described by the Delhi High Court in October 2024 by executive decision. The fund should publish a governance charter, a three-year plan, and a disbursal calendar aligned with CoE caseloads. Housing the fund in an autonomous entity would reduce administrative disruption from transfers and improve predictability. The Group 1 entitlement of INR 50 lakh should continue as implemented, while a managed-access track should be introduced for select Group 3 indications. That track should apply case-type caps and time-bound authorisations, link renewal to registry-captured outcomes, and provide a transparent escalation route to the fund’s board for exceptions.
2. Negotiating national price corridors and managed-access agreements. Market events have made pricing a policy imperative. On 28 August 2025, for instance, Indian regulators approved Zolgensma, a one-time gene therapy for spinal muscular atrophy. The therapy is among the most expensive globally.^[26] A Pricing and Access Cell that involves the Ministry of Health and Family Welfare, the Department of Pharmaceuticals, and Health Technology Assessment in India could negotiate price corridors for priority indications. Kerala’s pooled procurement and Goa’s confidential pricing models provide useful templates. National corridors could be paired with managed-access agreements that include dose caps and performance-based refunds. States could continue to tender through their agencies while purchasing within national corridors to avoid fragmentation and to allow smaller states to benefit from pooled volumes.
3. Converting CSR into multi-year programme grants and rebuilding the government crowdfunding portal as a secondary, reliable channel. Annual CSR outlays, roundtable participants estimated, amount to around INR 40,000 crore, with 20 to 25 percent typically flowing to health. The Ministry of Corporate Affairs can earmark a pre-determined proportion of total CSR funds for rare diseases, potentially matched by a public allocation to stabilise funding for defined cohorts. CSR resources should be structured as three-year programme grants routed through a national fund or accredited state windows.
   
   Further, available evidence indicates that legitimacy without robust user experience and outreach does not mobilise resources at the needed scale. Thus, the government crowdfunding portal should be upgraded to support recurring giving, automated 80G receipts, FCRA-ready flows, and cohort pages that display outcomes from CoEs. The portal should complement pooled public finance in a meaningful way.
   
   The Delhi High Court has constituted an expert committee of senior officials from key agencies and ministries to oversee the government’s rare-disease crowdfunding portal and strengthen CSR pathways.
4. Closing interruption risk with insurance hybrids and a 30-day Emergency Access Bridge at every CoE. Insurance regulators articulate a structural constraint: insurance covers unknown risk, which complicates underwriting for known rare-disease conditions. Pilot hybrids can work around this constraint by using a portion of funds allocated for Group 1 conditions as a one-time premium for co-morbid episodes and supportive care, with a pooled fund financing index therapy. In addition, each CoE should maintain a 30-day Emergency Access Bridge to prevent treatment interruptions during administrative processing. The reserve can be back-billed to a pooled national fund or state window under strict operating procedures. Clinically, avoiding interruptions protects outcomes and preserves the value of prior expenditures, while administratively, a small emergency fund at every CoE will likely be less costly than failed restarts.

Based on these recommendations, a streamlined implementation of the structure in place could lower interruption risk, stretch public and private finances further, and give patients and clinicians the confidence that the treatment of a rare disease, once started, can continue without uncertainties.

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Oommen C. Kurian is Senior Fellow and Head, Health Initiative, Centre for New Economic Diplomacy, ORF.

The author would like to acknowledge inputs from Mr Prasanna Shirol, ORDI, on an earlier draft of the report.  

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All views expressed in this publication are solely those of the author, and do not represent the Observer Research Foundation, either in its entirety or its officials and personnel.

Endnotes

^[a] According to WHO, rare diseases are specific health conditions affecting 1 in 2,000 individuals or fewer in a general population. There are currently over 7,000 known rare diseases afflicting more than 300 million people globally, with 70% of these conditions starting in childhood. Rare diseases in India include haematological disorders like haemophilia and thalassemia, lysosomal storage disorders such as Gaucher disease and Pompe disease, and neuromuscular conditions like Duchenne muscular dystrophy and spinal muscular atrophy.

^[1] Krishna Yadav and Jani Jessica,  “Roche Moves Supreme Court against Natco Pharma over Life-Saving Drug Patent,” Mint, October 14, 2025, https://www.livemint.com/companies/news/roche-moves-supreme-court-roche-vs-natco-life-saving-drug-patent-pharma-generic-risdiplam-11760424574692.html.

^[2] Oommen C. Kurian, “Rare Diseases: Justice Delayed, Treatment Denied,” Expert Speak, Observer Research Foundation, November 12, 2025, https://www.orfonline.org/expert-speak/rare-diseases-justice-delayed-treatment-denied.

^[3] Oommen C. Kurian, Parvathy Krishnan, and Vijay Sappani, “Rare Diseases in India: Still a Blind Spot,” Observer Research Foundation, February 28, 2021, https://www.orfonline.org/expert-speak/rare-diseases-in-india-still-a-blind-spot.

^[4] Mona and Shubhangi Patel, “Rare Diseases in India: ‘Orphan’ No More?,” ORF Special Report,  Observer Research Foundation, July 14, 2022, https://www.orfonline.org/research/rare-diseases-in-india-orphan-no-more.

^[5] Oommen C. Kurian, “Need vs Reality: Why Government’s Rare-Disease Portal Lags Behind,” Observer Research Foundation, September 5, 2025, https://www.orfonline.org/expert-speak/need-vs-reality-why-government-s-rare-disease-portal-lags-behind.

^[6] “Roundtable Discussion: Bridging the Gap – Ensuring Sustainable Funding for Rare Disease Treatment,” Proceedings (Observer Research Foundation and Organization for Rare Diseases India), 18 September, 2025, https://www.orfonline.org/event/bridging-the-gap-ensuring-sustainable-funding-for-rare-disease-treatment.

^[7] Rajya Sabha, Unstarred Question No. 261, “Policy on Treatment of Rare Diseases,” answered February 4, 2020, https://rsdebate.nic.in/bitstream/123456789/707817/1/IQ_251_04022020_U261_p267_p268.pdf.

^[8] Ministry of Health and Family Welfare, Government of India, National Policy for Rare Diseases, 2021 (New Delhi: MoHFW, 2021), https://rarediseases.mohfw.gov.in/uploads/Content/1624967837_Final-NPRD-2021.pdf.

^[9] Ministry of Health and Family Welfare, National Policy for Rare Diseases, 2021; Lok Sabha, Unstarred Question No. 701, “National Policy for Rare Diseases,” answered November 29, 2024, https://sansad.in/getFile/loksabhaquestions/annex/183/AU701_nbdruV.pdf.

^[10] Press Information Bureau, Government of India, “Customs Duty Full Exemption for All Imported Drugs and Foods for Special Medical Purposes for Personal Use for Treatment of All Rare Diseases,” March 30, 2023, https://www.pib.gov.in/PressReleasePage.aspx?PRID=1912095.

^[11] IANS, “GST on 33 Cancer Drugs, Rare Disease Medicines Slashed to 0%,” The News Minute, September 4, 2025, https://www.thenewsminute.com/news/gst-on-33-cancer-drugs-rare-disease-medicines-slashed-to-0-from-12-fm-sitharaman.

^[12] Lok Sabha, Unstarred Question No. 701 (November 29, 2024) and Unstarred Question No. 827 (February 7, 2025), Ministry of Health and Family Welfare, https://sansad.in/getFile/loksabhaquestions/annex/183/AU701_nbdruV.pdf; https://sansad.in/getFile/loksabhaquestions/annex/184/AU827_eN44h6.pdf.

^[13] Ministry of Health and Family Welfare, National Policy for Rare Diseases, 2021; Jakasaniya, D., & Tekwani, R., “A review on national policy of rare diseases, 2021,” Jindal Journal of Public Policy 6, no. 1 (2022), 99–105, https://doi.org/10.54945/jjpp.v6i1.157.

^[14] Lok Sabha, Unstarred Question No. 701 (November 29, 2024) and Unstarred Question No. 827 (February 7, 2025).

^[15] Ministry of Health and Family Welfare, Government of India, “Digital Portal for Crowdfunding & Voluntary Donations for Patients of Rare Diseases,” dashboard counters, https://rarediseases.mohfw.gov.in/.

^[16] Kurian, “Need vs Reality: Why Government’s Rare-Disease Portal Lags Behind”

^[17] Delhi High Court, order recording Supreme Court stay of the October 4, 2024 judgment, December 10, 2024, https://delhihighcourt.nic.in/app/showlogo/100018821733925207695_38576_53152020.pdf/2024.

^[18] Anuja Jaiswal, “Rare-Disease Patients Continue to Struggle Despite Govt Policies,” Times of India, June 1, 2025, https://timesofindia.indiatimes.com/city/delhi/rare-disease-patients-continue-to-struggle-despite-govt-policies/articleshow/121541834.cms, and documentation by organisations like ORDI and LSDSSI.

^[19] “Roundtable Discussion: Bridging the Gap – Ensuring Sustainable Funding for Rare Disease Treatment,” Proceedings (Observer Research Foundation and Organization for Rare Diseases India)

^[20] Kerala Medical Services Corporation Ltd., “Tender for the Procurement of Drugs for Rare Disease for the Year 2024–25,” September 13, 2024, https://kmscl.kerala.gov.in/KMSCL/uploads/announcements/ab81e306-Tenderfinal.pdf; Kerala Medical Services Corporation Ltd., “Notices,” https://kmscl.kerala.gov.in/KMSCL/index.php/ckmscl/menucontentview/35.

^[21] Kerala Medical Services Corporation Ltd., “Tender for the Procurement of Drugs for Rare Disease for the Year 2024–25,” September 13, 2024, https://kmscl.kerala.gov.in/KMSCL/uploads/announcements/ab81e306-Tenderfinal.pdf.

^[22] Government of Goa, National Health Mission, “Pricing Policy of Government of Goa for Innovative and Life-Saving Therapies,” August 2025, https://nhm.goa.gov.in/wp-content/uploads/2025/08/Goa-Confidential-Pricing-Proposal.pdf; “Pricing Policy of Government of Goa for Innovative and Life-Saving Therapies,”  https://nhm.goa.gov.in/pricing-policy-of-government-of-goa-for-innovative-and-life-saving-therapies/.

^[23] Government of Rajasthan, RajSambal rare-disease donations portal, https://rajsambal.rajasthan.gov.in/; “Donate,” https://rajsambal.rajasthan.gov.in/donate.aspx.

^[24] Government of Rajasthan, RajSambal rare-disease donations portal, https://rajsambal.rajasthan.gov.in/

^[25] “Roundtable Discussion: Bridging the Gap – Ensuring Sustainable Funding for Rare Disease Treatment,” Proceedings (Observer Research Foundation and Organization for Rare Diseases India)

^[26] Sumi Sukanya Dutta, “India Approves Zolgensma, One of World’s Costliest Drugs. Why It’s Sparked Hope, but Also Concern,” ThePrint, August 28, 2025, https://theprint.in/health/india-approves-zolgensma-one-of-worlds-costliest-drugs-why-its-sparked-hope-but-also-concern/2730423/.

^[27] Kurian, “Rare Diseases: Justice Delayed, Treatment Denied”

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