OBJECTIVES: We sought to review the approaches to health technology assessment (HTA) and pricing of orphan drugs in Europe. METHODS: Literature review. RESULTS: There is no universal HTA decision framework for orphan drugs and different jurisdictions focus on various HTA criteria, such as cost-effectiveness, budgetary impact, disease severity, therapeutic need, social benefits etc. However, standard HTA methods, such as cost-effectiveness analysis are not compatible with orphan drugs due to: 1) very limited clinical data and the use of surrogate endpoints, rather than patient-relevant endpoints; 2) a comparative assessment may be complicated by the lack of data on the natural history of the disease and the absence of an established standard-of-care treatment with known efficacy; 3) cost-effectiveness ratios are above acceptable thresholds due to a very high per patient cost. Consequently, lower significance levels for p-values (e.g. 10% significance levels) for small sample sizes, as well as the evidence from surrogate endpoints rather than only patient-relevant endpoints can be accepted and special legal frameworks for orphan drugs have been developed in some countries. These may consider the profits made by the company, the nature of the condition, the impact of the new technology, the cost for the national healthcare system, value for money, and the impact of the technology beyond direct health benefits. CONCLUSIONS: HTA and pricing of orphan drugs cannot follow the standard pathways and individual countries apply various ad hoc frameworks to enable the reimbursement of these drugs in their national health systems. This has led to inequality in access to these drugs among jurisdictions while the prices of the drugs remain very high. This calls for the development of universal guidelines on HTA methods for orphan drugs and for policy changes in order to ensure the sustainability of health care systems.