FDA’s New “Plausible Mechanism Pathway” and Other Initiatives To Expedite Approval of Drugs for Ultra-Rare Conditions

Rare and ultra-rare disease product developers face numerous complexities, including in designing and executing clinical trials in very small patient populations, defining and validating endpoints, satisfying the statutory evidentiary standard for product approval, and attracting investment for products with uncertain trajectories. The U.S. Food and Drug Administration (FDA or the Agency) has long recognized that traditional drug development and approval approaches are often ill-suited or infeasible for ultra-rare diseases and has made significant accommodations. However, as a former Director of FDA’s Center for Drug Evaluation Research (CDER) cautioned, the “current approach is failing” and the randomized controlled trial (RCT) construct and “p value” less than 0.05 is not “fit for purpose” in evaluating rare disease treatments in small trials.¹ And while FDA has exercised significant flexibility over the years and accepted the results of non-RCT studies based on medical need and strong evidence coming out of the trial, that approach can be highly unpredictable.

Against this backdrop and after months of dropping hints about prioritizing a potential new ultra-rare approval pathway, on November 12, 2025, FDA Commissioner Marty Makary and Center for Biologics Evaluation and Research (CBER) Director and FDA Chief Medical and Scientific Officer Vinay Prasad unveiled the new “Plausible Mechanism Pathway” (the Pathway) in a New England Journal of Medicine article.² Although framed as a new pathway, FDA appears to be seeking to operate under its existing statutory authorities, and does not appear to be seeking new statutory authority at this time. This means that drugs and biologics — even those approved under the new Pathway (which requires clinical data) — will need to meet the statutory standards of safety and efficacy (substantial evidence — drugs, safety, purity, and potency for biologics).

Their conceptual plan targets products for which a randomized trial is not feasible, and signals a significant shift in FDA’s approach to regulating the development of bespoke therapies. Functionally, the Pathway is a roadmap comprised of five core elements for proceeding to product marketing approval that leverages the Agency’s successful experience with several consecutive patients with different bespoke therapies. To illustrate how each element works in practice, the authors cited the “Baby K.J.” case study.³

While cell and gene therapies appear to be the initial focus of the Pathway, FDA left the door open for expanding the approach to small molecules and other large molecule products. While FDA’s therapeutic priority is in rare disease and especially diseases that are fatal or associated with severe disability in childhood, the Pathway also will be available for treatments aimed at common diseases, particularly those conditions for which there are no proven alternative treatments or for which there is considerable unmet need remaining after using available treatments.

The Plausible Mechanism Pathway, and other recent initiatives and guidance, reflect FDA’s awareness and renewed attention to addressing and mitigating some of the challenges faced by rare disease product sponsors. How much these developments will mitigate longstanding impediments inherent to this sector may be clearer once FDA issues promised regulatory guidance about the Pathway and shifts from concept to implementation. This Advisory summarizes the key elements of the Pathway, considerations it raises, and other recent FDA developments that complement the Agency’s enhanced focus on rare diseases in a deregulatory climate.

Plausible Mechanism Pathway

As noted, the Plausible Mechanism Pathway is designed around five core elements and leverages the expanded access single-patient Investigational New Drug (IND) paradigm as a vehicle for a product marketing application. It does not transform an expanded access IND directly into a marketing application, but treats successful single-patient outcomes as an evidentiary foundation for a future application. Whether common or ultra-rare, the Pathway is limited to diseases that have a known biologic cause, and not diseases that are “defined by a constellation of clinical findings or dozens of unclear genomewide associations.”⁴ The five Pathway elements include:

1. Identification of a specific molecular or cellular abnormality, not a broad set of consensus diagnostic criteria.

2. The medical product targets the underlying or proximate biological alterations.⁵

3. The natural history of the disease in the untreated population is well-characterized.

4. It is possible to confirm, and confirmation exists, that the target was successfully drugged, edited, or both.

5. There is an improvement in clinical outcomes or course of disease.

The Pathway aligns with the statutory standard by permitting effectiveness to be demonstrated through confirmation that the target was successfully drugged, edited, or both. For example, if a biopsy is clinically appropriate, then FDA would consider a confirmatory biopsy as supportive evidence. Keeping with the Agency’s efforts to curtail animal testing where possible, FDA acknowledged the futility of many animal studies and stated that it would “embrace nonanimal models where possible.”⁶ FDA also noted that the Agency will favorably view consistent improvement in conditions with progressive deterioration, whereas for conditions characterized by episodic waxing and waning, FDA will look for prolonged periods of disease remission. The Agency will also consider the previous clinical course and may consider patients as their own control. Finally, the clinical data must be strong enough to exclude regression to the mean.

Meeting all five elements, and demonstrating success in successive patients with different bespoke therapies, will be necessary for FDA to move toward granting marketing authorization for the product. FDA suggests that both the “regular” and “accelerated” approval pathways may be available to potential sponsors. Moreover, FDA anticipates that manufacturers will be able to leverage platform data from the personalized products to obtain marketing approval for similar products in additional conditions.

As expected, there will be a significant postmarket evidence-gathering component. Commissioner Makary has previously spoken in favor of harnessing and leveraging “Big Data,” particularly for rare disease products. For this Pathway, sponsors must — as a postmarketing commitment — collect real-world evidence (RWE) to demonstrate efficacy and safety, specifically, 1) preservation of efficacy, 2) no off-target edits (using pre-specified risk-benefit metrics), 3) the effect of early treatment on childhood growth and development milestones, and 4) detection of unexpected safety signals. FDA will consider safety in the context of the underlying disease condition, therapeutic efficacy, and ability to mitigate toxicity. Monitoring of the risk-benefit balance is expected, and FDA stated that it may revise warnings and limitations, reduce indications of use, or amend concomitant medications, depending on the postmarketing findings.

The New England Journal of Medicine proposal paints the contours of the Pathway but leaves the operational details for later. Reportedly, FDA intends to issue guidance on the Pathway, which will be closely watched, because its current form leaves many open questions. Areas in which we anticipate scrutiny include how the evidence generated through the Pathway will meet the statutory substantial evidence standard applied to drug and biologic product approvals, how the Pathway will align with the statutory requirement that efficacy be demonstrated through adequate and well-controlled clinical investigations, and the overall quantity of evidence/successful patient demonstrations required. The substantial evidence standard generally demands at least one adequate and well-controlled trial, plus confirmatory evidence, or two adequate and well-controlled trials. RCTs are the gold standard for an adequate and well-controlled trial, but FDA recognizes other types of trial designs as adequate and well-controlled. Given that the Pathway is intended for products for which an RCT is not feasible, FDA seems to be signaling increased support of alternative designs that have the hallmarks of an adequate and well-controlled study,⁷ but that previously were considered as an exercise of Agency flexibility.

These are critical issues — absent meeting the statutory standard, such approvals, often for orphan-designated products where exclusivities are at stake, could be subject to legal challenge as lacking appropriate statutory authorization. Notably, no such authority was pursued in the fiscal year 2026 budget proposal, and earlier this year, FDA’s Deputy Commissioner for Policy, Legislation, and International Affairs, Grace Graham, indicated that if additional legislative authority is needed to accomplish Commissioner Makary’s goals, FDA would seek such authority in the fiscal year 2027 budget proposal.⁸

Notably, while this “plausible mechanism” was initially described as a “conditional” approval pathway, FDA does not at this time propose — and has no current authority to impose — a true new conditional approval approach that goes beyond existing general and accelerated approval withdrawal provisions.

Bespoke therapies or platforms inevitably will be expensive. Already skeptical of certain accelerated approval candidates, payors will be scrutinizing the evidence on which these bespoke therapies are based. The Pathway’s postmarket surveillance framework bears hallmarks of accelerated approval confirmatory trials, and given the struggles of certain accelerated approval products to gain payor coverage before a confirmatory trial is completed, coverage and reimbursement may be challenging for “plausible mechanism” pathway products despite the small populations involved. Whether the postmarketing component is framed as a commitment or a confirmatory study may influence the dynamic. Other open questions about postmarket evaluation include the duration of the enhanced postmarketing surveillance and the type and quantity of RWE to be gathered.

Rare Disease Evidence Principles

Much of FDA’s focus on rare diseases this year has been oriented toward cell and gene therapies, including for ultra-rare conditions. Alongside the Plausible Mechanism Pathway are a number of initiatives intended to facilitate cell and gene therapy and rare disease treatments, and product development and new complementary guidance documents. These include FDA’s Rare Disease Innovation Hub and Rare Disease Evidence Principles (RDEP),⁹ the latter of which FDA announced in September 2025.

RDEP is a joint CDER and CBER process to facilitate approval of drugs intended to treat rare diseases. The process targets conditions that have a known genetic defect that is the major driver of the pathophysiology, very small patient populations, and significant unmet medical need. Eligible rare disease products are those for which —

• A known, in-born genetic defect is the major driver of the pathophysiology
• The clinical course of the disease is progressive deterioration in function leading to rapid and/or significant disability or death in a relatively short period of time
• The patient population is very small (e.g., fewer than 1,000 persons in the U.S.)
• There is a lack of any adequate alternative therapies that alter the course of the disease

The product must be intended to correct the genetic defect — i.e., correct the gene or replace an essential physiological protein that is otherwise deficient due to the gene defect.

Because generating substantial evidence of efficacy through traditional trial designs is a challenge in rare disease product development, the new process is intended to clarify the evidence that meets this standard. For drugs meeting the eligibility criteria, FDA anticipates that substantial evidence of effectiveness can be established through one adequate and well-controlled trial, that may be a single-arm design, accompanied by “robust data that provides strong confirmatory evidence of the drug’s treatment effect.”¹⁰ FDA also stated that it would “consider confirmatory evidence provided through the appropriate selection of external controls or natural history studies.”¹¹ Sponsors must apply before the launch of a pivotal trial of such products.

New Guidance for Industry

In addition, three recently released draft guidance documents complement FDA’s rare disease focus and the Pathway.

• Innovative Designs for Clinical Trials of Cellular and Gene Therapy Products in Small Populations
• Postapproval Methods to Capture Safety and Efficacy Data for Cell and Gene Therapy Products
• Expedited Programs for Regenerative Medicine Therapies for Serious Conditions

The Innovative Designs guidance, for example, highlights a variety of clinical trial approaches that sponsors may consider when developing cell and gene therapies in small populations, including single arm trials using participants as their own control, disease progression modeling, externally controlled studies, among others. The Postapproval Methods draft guidance notes, among other things, that postapproval methods that capture safety and efficacy data can help balance premarket and postmarket data, including for cell and gene therapy products approved under accelerated pathways. In addition, the postapproval collection of real-world evidence can provide additional data to studies that have small sample sizes, lack of comparators, and low completion rates.

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FDA’s release of the Plausible Mechanism Pathway concept marks the next iteration of FDA’s efforts to streamline and facilitate development of rare disease and bespoke therapies. Together with initiatives such as RDEP and new guidance documents on trial design and postapproval data collection, FDA is signaling its support for this segment of the healthcare sector and its potential. Yet the proposal, as it stands, leaves details and uncertainties to be addressed in future guidance and perhaps even a pilot program, which may test the limits of the Agency’s flexibility and what comprises substantial evidence under current law. FDA’s planned guidance on the new Pathway will be an important vehicle for stakeholders to weigh in and shape FDA’s plans, and stakeholders may want to consider comments on the new draft guidances that could help shape interactions with the Pathway policy.

We will continue to monitor developments in this area.

© Arnold & Porter Kaye Scholer LLP 2025 All Rights Reserved. This Advisory is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.