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Experts discuss economic incentives for antibiotic development

Aaron S. Kesselheim, MD, JD, MPH, is an associate professor of medicine, Harvard Medical School Director, Program On Regulation, Therapeutics, And Law (PORTAL), division of pharmacoepidemiology and pharmacoeconomics, department of medicine, Brigham and Women’s Hospital. Kesselheim can be reached at akesselheim@partners.org.

Only certain types of incentives can help repair the antibiotic pipeline.

We did a study recently published in Science of antibiotic research and development over the past 2 decades in which we showed that a majority of experimental antibiotics are now being sponsored by small- and medium-sized drug companies. We also found that antibiotics are significantly more likely than all other drug types to proceed successfully through clinical trials. Taken together, these results illuminate which kind of economic incentives will be particularly important in promoting development of important new antibiotics.

First, the share of smaller companies developing antibiotics suggests targeted incentives such as research and development tax credits, which are immediately borne by sponsors and can be reinvested in research and development, could be particularly useful in ensuring that promising early compounds are not shelved due to financial concerns alone. Conversely, extensions in market exclusivity for approved antibiotics, which affect revenue streams in the distant future, are not likely to help.

Second, our analysis also suggests that economic policies to stimulate antibiotic research and development would have greater impact if they raised the level of new antibiotics entering clinical trials, rather than change the probability of clinical trial success. For example, increased public sector funding for basic research would increase the number of new compounds that could be licensed from universities and public research institutes. Historically, such centers have been the sources of the majority of medicine’s most transformational new drug products, and they will most likely be where the important new antibiotics of the future will emerge from as well.

By contrast, proposed legislation now before Congress would allow approval of new antibiotics based on scant clinical testing before investigators know whether they work or are safe enough, which could be harmful to patients and counterproductive to the goal of learning which new antibiotics will have the greatest impact on patient health outcomes.

Finally, government and private payors should be prepared to preferentially reimburse therapies that offer rigorously proven and clinically relevant benefits or address unmet medical needs. To help in this determination, more new antibiotics will need to be tested in superiority trials in the setting of patients with multidrug-resistant infections who lack effective options.

Reference:

Hwang TJ, et al. Science. 2014;doi:10.1126/science.1251419.

 

R. Brooks Gainer II, MD, FACP, FIDSA, FSHEA, is an Infectious Disease News Editorial Board member as well as a clinical associate professor of medicine, West Virginia University School of Medicine. Gainer can be reached at grbgainer@aol.com.

Staphylococcus aureus resistance to penicillin in the 1950s should have alerted the medical community to what the future would bring. Physicians have relied on new antimicrobial development to combat resistance issues for decades. Proper prescribing, antibiotic stewardship and basic infection control practices were given token attention. It has been estimated that over half of antibiotics are inappropriately used. This includes wrong indication, wrong drug, wrong dose and duration. Simple hand washing has been ignored. It has been demonstrated that this alone can have a major impact on nosocomial infection and antimicrobial resistance rates.

The article by Owens and colleagues gives an excellent description of how we got to where we are, and it reviews the current efforts to address the serious resistance issue facing our world. The article by Sanchez and colleagues in the December issue of Emerging Infectious Diseases shows that a lot more education must be done to influence the prescribing habits of U.S. physicians. Another equally important task is continuing to educate the public that an antimicrobial is not needed for every febrile illness. The current Clostridium difficile nosocomial epidemic illustrates what this pattern of practice can cause. IDSA’s 10 x ’20 initiative is a great start, as are the GAIN and ADAPT acts. Government, pharma, academia, biotech and private investors need to develop a cooperative, comprehensive plan to combat this problem. The recent efforts by some food suppliers to limit the use of antimicrobials in the raising of animals is a big step forward.

I realize this is a huge task to accomplish, but not doing it could be disastrous to society. New antimicrobials alone will not decrease the resistance crises we face. Physicians need to practice what they have been taught about infection control, especially hand hygiene and the proper use of antimicrobials.

Reference:

Sanchez GV, et al. Emerg Infect Dis. 2014;doi:10.3201/eid2012.140331.

 

David M. Shlaes MD, PhD, is sole proprietor and president, Anti-infectives Consulting, retired. Shlaes can be reached at Shlaes.david@earthlink.net.

Large pharma is needed to drive antibiotic development.

There are several factors that continue to block our ability to improve our antibiotic pipeline. These include the scientific challenges to identifying new products, the lack of sufficient effort in antibiotic discovery and development and the economics of the antibiotic marketplace. The regulatory environment has now improved to the point where it is no longer the disincentive it once was. The lack of the critical mass of research required to fill the pipeline is directly related to the exodus of large pharmaceutical companies from the area over the last 16 years and the continued consolidation within the industry leading to further diminution of the skilled workforce needed to carry out these activities. Convincing large pharma that antibiotics can once again be profitable can repair this remaining problem.

Large pharma is essential to the equation because only they have pockets deep enough to drive discovery and development in small companies, biotech and academia. Government funding, including the Biomedical Advanced Research and Development Authority in the United States and the Innovative Medicines Initiative in Europe, has, at least so far, been insufficient to provide the kind of monies required to substitute for private investment.

Recently, Jim O’Neill, former chairman of Goldman Sachs Asset Management, published a report calling for upfront payments of between $2 billion and $3 billion for new, needed antibiotics. Such a payment would immediately cover all the research and development costs of a new antibiotic, including all sunk costs from prior failures. In many cases, it would also provide an immediate return on investment for shareholders. Such a scheme, perhaps married to higher prices or a smorgasbord of combinations of high prices and upfront government payments tailored to different markets would, in my view, provide the economic motivation necessary to get the antibiotic pipeline back to where it was in the 1980s.

Reference:

O’Neill J. The review on antimicrobial resistance. Securing new drugs for future generations: the pipeline of antibiotics. 2015. http://amr-review.org/sites/default/files/SECURING%20NEW%20DRUGS%20FOR%20FUTURE%20GENERATIONS%20FINAL%20WEB_0.pdf. Accessed May 22, 2015.

Disclosure: Gainer, Kesselheim and Shlaes report no relevant financial disclosures.

Aaron S. Kesselheim, MD, JD, MPH, is an associate professor of medicine, Harvard Medical School Director, Program On Regulation, Therapeutics, And Law (PORTAL), division of pharmacoepidemiology and pharmacoeconomics, department of medicine, Brigham and Women’s Hospital. Kesselheim can be reached at akesselheim@partners.org.

Only certain types of incentives can help repair the antibiotic pipeline.

We did a study recently published in Science of antibiotic research and development over the past 2 decades in which we showed that a majority of experimental antibiotics are now being sponsored by small- and medium-sized drug companies. We also found that antibiotics are significantly more likely than all other drug types to proceed successfully through clinical trials. Taken together, these results illuminate which kind of economic incentives will be particularly important in promoting development of important new antibiotics.

First, the share of smaller companies developing antibiotics suggests targeted incentives such as research and development tax credits, which are immediately borne by sponsors and can be reinvested in research and development, could be particularly useful in ensuring that promising early compounds are not shelved due to financial concerns alone. Conversely, extensions in market exclusivity for approved antibiotics, which affect revenue streams in the distant future, are not likely to help.

Second, our analysis also suggests that economic policies to stimulate antibiotic research and development would have greater impact if they raised the level of new antibiotics entering clinical trials, rather than change the probability of clinical trial success. For example, increased public sector funding for basic research would increase the number of new compounds that could be licensed from universities and public research institutes. Historically, such centers have been the sources of the majority of medicine’s most transformational new drug products, and they will most likely be where the important new antibiotics of the future will emerge from as well.

By contrast, proposed legislation now before Congress would allow approval of new antibiotics based on scant clinical testing before investigators know whether they work or are safe enough, which could be harmful to patients and counterproductive to the goal of learning which new antibiotics will have the greatest impact on patient health outcomes.

Finally, government and private payors should be prepared to preferentially reimburse therapies that offer rigorously proven and clinically relevant benefits or address unmet medical needs. To help in this determination, more new antibiotics will need to be tested in superiority trials in the setting of patients with multidrug-resistant infections who lack effective options.

Reference:

Hwang TJ, et al. Science. 2014;doi:10.1126/science.1251419.

 

R. Brooks Gainer II, MD, FACP, FIDSA, FSHEA, is an Infectious Disease News Editorial Board member as well as a clinical associate professor of medicine, West Virginia University School of Medicine. Gainer can be reached at grbgainer@aol.com.

Staphylococcus aureus resistance to penicillin in the 1950s should have alerted the medical community to what the future would bring. Physicians have relied on new antimicrobial development to combat resistance issues for decades. Proper prescribing, antibiotic stewardship and basic infection control practices were given token attention. It has been estimated that over half of antibiotics are inappropriately used. This includes wrong indication, wrong drug, wrong dose and duration. Simple hand washing has been ignored. It has been demonstrated that this alone can have a major impact on nosocomial infection and antimicrobial resistance rates.

The article by Owens and colleagues gives an excellent description of how we got to where we are, and it reviews the current efforts to address the serious resistance issue facing our world. The article by Sanchez and colleagues in the December issue of Emerging Infectious Diseases shows that a lot more education must be done to influence the prescribing habits of U.S. physicians. Another equally important task is continuing to educate the public that an antimicrobial is not needed for every febrile illness. The current Clostridium difficile nosocomial epidemic illustrates what this pattern of practice can cause. IDSA’s 10 x ’20 initiative is a great start, as are the GAIN and ADAPT acts. Government, pharma, academia, biotech and private investors need to develop a cooperative, comprehensive plan to combat this problem. The recent efforts by some food suppliers to limit the use of antimicrobials in the raising of animals is a big step forward.

I realize this is a huge task to accomplish, but not doing it could be disastrous to society. New antimicrobials alone will not decrease the resistance crises we face. Physicians need to practice what they have been taught about infection control, especially hand hygiene and the proper use of antimicrobials.

Reference:

Sanchez GV, et al. Emerg Infect Dis. 2014;doi:10.3201/eid2012.140331.

 

David M. Shlaes MD, PhD, is sole proprietor and president, Anti-infectives Consulting, retired. Shlaes can be reached at Shlaes.david@earthlink.net.

Large pharma is needed to drive antibiotic development.

There are several factors that continue to block our ability to improve our antibiotic pipeline. These include the scientific challenges to identifying new products, the lack of sufficient effort in antibiotic discovery and development and the economics of the antibiotic marketplace. The regulatory environment has now improved to the point where it is no longer the disincentive it once was. The lack of the critical mass of research required to fill the pipeline is directly related to the exodus of large pharmaceutical companies from the area over the last 16 years and the continued consolidation within the industry leading to further diminution of the skilled workforce needed to carry out these activities. Convincing large pharma that antibiotics can once again be profitable can repair this remaining problem.

Large pharma is essential to the equation because only they have pockets deep enough to drive discovery and development in small companies, biotech and academia. Government funding, including the Biomedical Advanced Research and Development Authority in the United States and the Innovative Medicines Initiative in Europe, has, at least so far, been insufficient to provide the kind of monies required to substitute for private investment.

Recently, Jim O’Neill, former chairman of Goldman Sachs Asset Management, published a report calling for upfront payments of between $2 billion and $3 billion for new, needed antibiotics. Such a payment would immediately cover all the research and development costs of a new antibiotic, including all sunk costs from prior failures. In many cases, it would also provide an immediate return on investment for shareholders. Such a scheme, perhaps married to higher prices or a smorgasbord of combinations of high prices and upfront government payments tailored to different markets would, in my view, provide the economic motivation necessary to get the antibiotic pipeline back to where it was in the 1980s.

Reference:

O’Neill J. The review on antimicrobial resistance. Securing new drugs for future generations: the pipeline of antibiotics. 2015. http://amr-review.org/sites/default/files/SECURING%20NEW%20DRUGS%20FOR%20FUTURE%20GENERATIONS%20FINAL%20WEB_0.pdf. Accessed May 22, 2015.

Disclosure: Gainer, Kesselheim and Shlaes report no relevant financial disclosures.