Bacteria that can defeat current antibiotic drugs are sometimes called “the next pandemic.” Already, infections from them are believed to cause or contribute to more deaths worldwide than HIV/AIDS and malaria combined.
Yet the pharmaceutical industry has been slow to respond with new medicines, even with the promise of extended protection from generic competitors and other, potentially lucrative government incentives.
Drug executives complain that these incentives, created by a law passed a decade ago, don’t help new antibiotics earn much in the way of sales, dampening enthusiasm for further research.
Unlike cancer drugmakers, which can generally count on a waiting market, “virtually every [antibiotics] company has suffered from lack of commercial success,” said Evan Loh, the CEO of Paratek Pharmaceuticals, which in 2018 won U.S. approval for an antibiotic for skin and lung infections. “This is an ecosystem that’s fragile, failing and basically dying.”
Meanwhile, policy experts argue that the law rewards drugmakers for winning approval of treatments that aren’t better than existing options, giving doctors little reason to use them.
In response, there’s a new global push underway to solve the problem by guaranteeing “subscription-style” government contracts for new antibiotics if they are able to treat drug resistant infections, represent a new drug type or otherwise improve on existing treatments.
The issue has risen to the level of major country collaboration. At a December meeting, finance ministers from the Group of 7 countries committed to “address antibiotic market failure and create the right economic conditions to preserve essential existing antibiotics.” The U.K. is already experimenting and a new bill in the U.S. that’s gathering momentum could offer several solutions.
Building new incentives
The promise of a guaranteed government contract is a departure from past efforts to spur antibiotic innovation, which have focused on extending drugmakers’ monopolies, streamlining regulatory review and granting vouchers for expedited regulatory review that can be resold.
These efforts largely have been viewed as unsuccessful because they haven’t targeted unmet medical needs, haven’t required new products to outperform existing treatments and have offered additional market exclusivity to drugs that should be subject to generic competition.
A subscription-type framework is similar in concept to what Louisiana tried with hepatitis C antiviral drugs, although that was a bid to keep the costs to the state’s Medicaid program under control rather than spur innovation.
Such plans for antibiotics already are nearing reality in the U.K., which announced a framework in 2019 and is currently evaluating anti-infective drugs from Shionogi and Pfizer for inclusion.
The U.S. is further behind but could get closer if legislation now being developed by Reps. Diana DeGette, D-Colo., and Fred Upton, R-Mich., is signed into law. The bill, called “21st Century Cures 2.0,” intends to build on legislation enacted in 2016 that funded the “Cancer Moonshot” at the National Institutes of Health.
Cures 2.0 would create an initial $11 billion fund for antibiotic purchases and lays out a plan for evaluating what types of infectious diseases need new treatments and the standards new antibiotics would need to meet in order to qualify. The requirements currently spelled out in the legislation favor drugs that are chemically distinct from anything approved in the past or that represent a new class of treatments.
The value of those contracts may be sufficient encouragement for drugmakers to develop new antibiotics, according to some policy analysts.
For example, small biotechs with an antibiotic that qualifies could secure subscription contracts worth between $750 million and $3 billion over five to 10 years. The potential guarantee of billions of dollars of revenue in the U.S. and elsewhere, if more governments try out this model, should be a sufficient demand “pull” to lure more developers into antibiotics, including even big drugmakers, said Kevin Outterson, a law professor at Boston University.
According to Outterson, who also is executive director of CARB-X, a non-profit organization seeking to spur antibiotics research, the promise of $4.2 billion over 10 years on average should be a sufficient incentive for companies to enter the market.
“It’s big enough to move the needle for all of the companies,” Outterson said of the total dollar amount in the Cures 2.0 bill. His analysis of the law recently was published in the journal Health Affairs.
Push and pull
Still, for antibiotic developers, the promise of a subscription contract may not be enough. Commercial sales that could help add to their revenue stream would prove more attractive, but because insurers, including Medicare, don’t reimburse hospitals for using new antibiotics, they are reserved for rare cases. That leads to very low revenue.
Take Achaogen, a drugmaker that went bankrupt in 2019 despite gaining extra protection from competition for its drug for urinary tract infection. Most global rights to Achaogen’s drug now are in the hands of generics company Cipla.
Separate legislation, called DISARM, seeks to change Medicare hospital reimbursement for use of new antibiotics, providing a special add-on payment for appropriate use of newly approved antibiotics granted special status from the Food and Drug Administration.
This may encourage private insurers to do the same, advocates say.
“The important thing is to realize that government intervention can bridge us, but it will not drive the volume of innovation we need,” said Manos Perros, CEO of Entasis, which is developing several pathogen-specific medicines to treat drug-resistant infections. “Innovation in drug discovery takes a decade plus, and to invest in an early stage discovery program you need long-term visibility on the reward.”
However, critics of that legislation point out that some drugs granted special FDA status still don’t represent an improvement over existing treatments.
That could lead to hospitals “squandering limited resources on products that do not provide any additional patient benefit,” Jonathan Darrow and Aaron Kesselheim, of the Harvard University and Brigham and Women’s Hospital’s Program On Regulation, Therapeutics, And Law, wrote in Open Forum Infectious Diseases.
Moreover, the added payments “might have the unintended consequence of incentivizing off-label use by providers and institutions, with important patient safety implications,” Kesselheim and another colleague, Michael Sinha, wrote in a separate article.
While Cures 2.0 was introduced last November, and DISARM last June, no hearings on either have been scheduled yet as Congress works to balance other major pieces of legislation. Cures 1.0 won broad legislative backing from Democrats and Republicans, but it’s unclear whether its successor will enjoy similar support in the current Congress.
