11 cases have been registered in connection with the case, including under the Protection of Children from Sexual Offences Act, following a complaint from the orphanage authorities.
The statements of the victims, all below 15 years, have been recorded and their medical examination completed, police said.
The gang lured the girls and forced them to watch pornographic films before subjecting them to sexual abuse, police said, adding, a search is on for three more persons involved in the crime.'
They were allegedly subjected to sexual abuse over a period of two months.
The matter came to light after one of the girls was seen coming out from a nearby shop and was questioned by the orphanage staff, following which a complaint was lodged with police.
The incident comes close on the heels of a 16-year-old girl being allegedly raped by a church vicar at Kottiyoor in neighbouring Kannur district.
The girl gave birth to a boy on February 7 after which the priest was arrested.
Seven other accused in the case, five of them nuns and a doctor, are still absconding.