Issue: August 2016
August 17, 2016
13 min read

Public-private partnerships critical in fight against infectious diseases

Issue: August 2016
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Robert C. Bollinger

The threat of infectious diseases continues to drive innovation in the free market, resulting in improved or novel therapies and diagnostics. Among its benefits, the free market is a place where readily available resources can be used to tackle emerging threats. One example is the number of companies that have stepped up to develop a vaccine during the current Zika virus outbreak, according to Richard B. Markham, MD, professor of molecular microbiology and immunology at Johns Hopkins Bloomberg School of Public Health.

Eric Rubin

“We like to think the government can move equally quickly when faced with a threat like this,” Markham told Infectious Disease News, “but the politics of that has turned out to be pretty difficult.”

On the other hand, the free market sometimes fails to sufficiently address threats to human health such as antimicrobial resistance, according to Robert C. Bollinger, MD, MPH, founding director of the Center for Clinical Global Health Education and professor of infectious diseases at Johns Hopkins University School of Medicine.

David Shoultz, PhD, MS, MBA, program leader for drug development and devices and tools at PATH, said it is crucial for governments to expand incentive mechanisms for companies that are developing products considered global health priorities.

Photo credit: PATH/Patrick McKern

“The pipeline is not as primed or as robust as we need it to be to meet present or future challenges associated with drug-resistant bacteria,” Bollinger said in an interview. “That’s a major challenge and a major failure globally.”

When profits are hard to come by, public-private partnerships can help drive research and development, Eric Rubin, MD, PhD, the Irene Heinz Given Professor of Immunology and Infectious Diseases at Harvard T.H. Chan School of Public Health, told Infectious Disease News.

“Our new treatment and prevention strategies for many infections are likely to arise from avenues like these,” Rubin said.

Infectious Disease News spoke with several experts about the successes and failures of the free market in addressing global health threats, and how public-private partnerships (PPPs) help develop the tools and treatments needed to battle infectious diseases.

‘No substitute’ for free market

According to Rubin, industry was instrumental from the start in not only helping to discover new antibiotics, but also discovering ways to produce them efficiently in formulations that are deliverable to patients.

“There’s no substitute,” Rubin said. “Many types of expertise that are needed to turn a discovery — even if it was made in academia — into a drug only exist in industry.”

More recently, the FDA approved the first clinical trial evaluating a Zika virus vaccine in humans in June, just over 4 months after WHO declared the Zika epidemic a public health emergency. The drug, GLS-5700, was developed by U.S. manufacturer Inovio Pharmaceuticals and a South Korean company, GeneOne Life Science.

In fact, as of mid-July, 21 companies and research institutions were working on approximately 35 Zika vaccine projects, WHO spokeswoman Nyka Alexander told Infectious Disease News. The value and importance of the free market can be seen in these types of responses, Bollinger said.

“Look at how quickly we were able to leverage companies to come up with diagnostic approaches for some of the emerging epidemics over the last few years such as Zika and Ebola,” he said. “The free market has been quite good at that.”

Hannah Kettler

Profits limited in low-income countries

Treating infectious diseases in low-income countries, however, is one area where the free market in and of itself is insufficient to motivate the necessary innovation. Limited markets for diseases such as malaria lead to a lack of investment and effort in fighting them, according to Hannah Kettler, PhD, senior program officer for Life Science Partnerships, Global Health, at the Bill & Melinda Gates Foundation.

“Market drivers are not sufficient to pull private sector funding toward the priorities of the globe’s poorest populations,” Kettler told Infectious Disease News.

Naturally, the market works better where there are higher profits. There are clear economic incentives to treat chronic, incurable diseases like diabetes and hypertension that require daily medication that must be taken for the rest of a patient’s life, Rubin said. Likewise, cancer treatments command high prices even if they are given with the intent to cure.

“Most infectious diseases, though, are curable, and many require only short courses of therapy in order to effect cure,” Rubin said. “That means, for most [infectious] diseases, profits will always be limited.”

From both a market and global health perspective, it helps when battling infectious diseases and turning a profit are not mutually exclusive goals. For instance, neither HIV nor hepatitis C virus has a vaccine, but treatments for both have been hugely beneficial to patients and a source of financial gain for some companies. Similarly, the market for infectious disease diagnostics is expected to surpass $18 billion by 2019, according to a report last year.

“There are some public health challenges that also bring profit,” David Lee Thomas, MD, MPH, director of the division of infectious diseases and professor of medicine at Johns Hopkins University School of Medicine, told Infectious Disease News. “In those instances, the convergence of interest brings enormous benefit.”

Geography matters

According to Bill Gates, the market sometimes works to treat diseases in low-income countries because those same diseases also circulate in high-income countries.

Bill Gates

“Many of the diseases we work on are present in the ‘rich’ world. You could say that’s unfortunate or fortunate,” Gates said during the keynote session at ASM Microbe 2016.

For instance, using what Gates described as an aggressive form of tiered pricing, companies making HIV drugs can pay for research and development and turn a profit by selling those drugs in wealthier countries like the United States. This way, they can make the drugs at cost in poorer countries and provide voluntary licenses to generic manufacturers — like those in India — to allow them to make the drugs as cheap as possible.

“That’s been a perfect model,” Gates said. “Pharma has been incentivized to do their brilliant work, and the availability in poor countries of those drugs has been really great.”

According to Gates, this tiered pricing arrangement does not work when it comes to some diseases, such as malaria. In these instances, money for developing a drug can be secured through governments or philanthropic organizations.

“There are neglected areas of medicine where there is considerable public health benefit that doesn’t bring profit,” Thomas said. “There is no reason to be surprised why a for-profit company doesn’t step in to meet these needs.”

The problem of antimicrobial resistance

Geography also may play a role in solving the problem of antimicrobial resistance.

Fears about antimicrobial resistance were further heightened recently by the emergence of the mcr-1 gene, which is resistant to the so-called antibiotic of last resort, colistin. The gene recently was detected in the U.S. for the first time — which could be both good and bad news.

“Like for most diseases, the number of people who die from antimicrobial resistance is a hundred times larger in the poorer countries than it is in the United States,” Gates said at ASM Microbe. “It’s sad that it’s in the United States, but because it’s in the United States, lots of for-profit incentive is there to replenish the pipeline for antibiotics.”

The pipeline has been dry for a while. In fact, according to a report in Nature Microbiology, every antibiotic currently in use is derived from a class that was discovered between the early 1900s and 1984. The problem, Bollinger said, is that there are few incentives to develop new drugs.


“This is not an issue unique to developing new antibiotics,” he said. “It’s a challenge to developing vaccines. It’s a challenge to developing curative treatments for all sorts of chronic diseases.”

Further complicating the issue, at least in the case of antibiotics, is the notion that a new drug’s usage should be restricted to avoid resistance. In such cases, incentives attached to programs like the FDA’s orphan drug designation can spur companies to manufacture drugs that are only going to be used in small volumes, giving them better pricing opportunities, Gates said.

A call for more incentives

Under the orphan drug program, incentives such as tax credits are available to companies for developing agents with limited profitability: those that treat rare conditions or those that are not expected to recoup what it cost to develop and market them. Other incentives — such as the FDA’s Humanitarian Use Device Program and priority review voucher — exist already, but industry is asking for more.

Recently, approximately 100 pharmaceutical, biotechnology and diagnostic companies signed a letter calling for more incentives to bridge what they called the “innovation gap” impeding the development of new antibiotics. The proposed incentives to develop potentially unprofitable antibiotics included “prompt reimbursement” at fair prices for making such drugs.

The companies’ plea is supported by a wide-ranging report on antimicrobial resistance commissioned by the British government, which found a “mismatch” between the existing threat of antimicrobial resistance and the slow rate of new drug development, owing to limited opportunity to recoup development costs before a patent runs out.

When it comes to antimicrobial resistance and the lack of new antibiotics on the market, there is enough blame to go around, Bollinger said.

“Is it a failure of the free market or a failure of governments, including our own, to invest in the basic research? Probably a combination of both,” he said.

Public funding for research and development is critical, according to the Global Health Technologies Coalition (GHTC), a group of more than 25 nonprofit organizations that recently unveiled its seventh annual policy report in Washington.

No country has a bigger financial impact on the fight against infectious diseases than the U.S., which contributes approximately 70% of the world’s public investment in global health research and development and 45% of the private and philanthropic funding, according to the GHTC report. However, although the U.S. is the lead funder for 26 of the 30 most neglected tropical diseases, funding for research has either declined or remained stagnant since a peak in 2009, other than an uptick during the 2014 Ebola outbreak in West Africa, the GHTC said.

The GHTC urged Congress to appropriate more than $48 billion in public funding for government health agencies involved in global health R&D and called for the creation of new incentives — or the reforming of old ones — to encourage private companies to invest. The incentives include prizes, advanced market commitments and tax credits.

“One of the most important things that governments can do, including the U.S. government, is continue to expand the incentive mechanisms that exist for companies to continue to develop products that are a global health priority,” David Shoultz, PhD, MS, MBA, program leader for drug development and devices and tools at PATH, an international nonprofit focused on global health innovation, told Infectious Disease News.

While profit is an important motivator, there are incentives beyond mere financial gain for companies that want to be involved in the global fight against infectious diseases, Shoultz said.

Such work can be a motivator and an employment retention device for pharmaceutical companies with senior employees who may have gotten into the business to grapple with such diseases and who feel aligned with that goal.


“The incentives landscape is complex, it’s nuanced, and it’s far from being simply financial, although that is an important component,” Shoultz said. “I think it’s possible to be cynical and think, this is all ... window dressing. This is all driven by a desire to be on the cutting edge so you can maximize profits later on. And I understand why. But I have been sincerely struck by the level of motivation from people who could be making more money doing something else, but are really dedicated to global health and want to be at this nexus, this area of confluence where the pharma model and the global health model come together.”

Shoultz predicts that the pharmaceutical industry will begin to set goals that are more humanitarian than financial.

“There are market incentives for companies, especially those that aren’t fixated on what I think is a very fallacious model of product development, which is the blockbuster model,” he said, referring to drugs that generate more than $1 billion in annual sales. “I don’t think the blockbuster model has a great deal of credibility or merit even for high-income countries. And yet, that’s been a very pervasive part of the pharma model, at least for the past 10 years. I think we’re going to see a turning away from that model.”

The role of public-private partnerships

When there are not enough incentives in the free market to mitigate the risks that come with investing in infectious disease treatments and diagnostics, PPPs can help share the resource burden.

Since 2000, programs like WHO’s Global Alliance for Vaccines and Immunizations (GAVI) and the Global Fund — a PPP that raises and invests nearly $4 billion a year to fight AIDS, tuberculosis and malaria — have provided the world with more ways to battle infectious diseases.

“We’re worried that that’s going to plateau,” Gates said, “but since 2000, the global health story is a pretty amazing story [that includes] more resources.”

Identifying private funds can sometimes help researchers cross the so-called “valley of death” — the stage between using public grants to identify a product and searching for funding to take it to clinical trials.

“That gap can be difficult,” Markham said. “That’s the money that has to come from wealthy investors or in some cases venture capitalists if they are sure that this has immense potential. But it’s a problem area.”

Many PPPs are funded by the Bill & Melinda Gates Foundation, which has contributed billions of dollars in the fight against infectious diseases, including HIV, malaria, polio and TB. According to Rubin, Gates has personally recruited the CEOs of many big pharmaceutical companies to participate in a program to discover and develop new tools and treatments that work against TB.

“My research has benefited from all of these,” Gates said. “And while they haven’t yet led to a cure for TB, these efforts represent our best chance.”

According to Kettler, PPPs work by bringing together the best of what the public and private sectors have to offer. An example of where this can be seen is in the development of new drugs and vaccines.

“The biopharmaceutical companies know how to discover, develop and commercialize the products but might lack disease-specific expertise as well as experience operating in the targeted geographies and with the targeted populations,” Kettler said. “Through partnership with nonprofit and public organizations with dedicated disease and country experience, the companies can design better targeted products, can gain access to and utilize complementary science and technology knowledge that they might not invest directly in ... and gain help designing and executing clinical trials in the developing world and associated regulatory dossiers.”

Creative problem solving

By merging experts from different sectors, PPPs often produce solutions to pressing global health problems that may not have been possible otherwise.


For example, UPS recently partnered with GAVI and the California robotics company Zipline International to use unmanned aerial drones to deliver blood and vaccines to remote areas that are hard to reach by traditional means. UPS funded the initial launch of the project in Rwanda with an $800,000 grant. Initially, the Rwandan government will only use the drones to deliver blood supplies, but an expanded plan includes deliveries of vaccines and treatments for illnesses such as HIV/AIDS, malaria and TB.

According to a recent study in Vaccine, using drones could make vaccines more available and cheaper to distribute if they are deployed frequently enough to overcome costs.

“Public-private partnerships are essential in confronting the world’s current humanitarian challenges,” Eduardo Martinez, JD, president of the UPS Foundation, told Infectious Disease News. Martinez said the drone partnership “will create a powerful opportunity for solving a wide array of humanitarian and health issues, including fighting infectious diseases and ultimately saving lives.”

According to Shoultz, creativity born from PPPs can play a key role in the fight against infectious diseases — especially when researchers arrive at the “valley of death.”

“Creativity is really at the heart of it,” he said.

At PATH’s headquarters in Seattle, Shoultz said the product development shops are filled with scientists working with different materials and tools to create new products — wood, foam, saws, metal presses. The nonprofit organization, which receives funding from both public and private entities, spends most of its more than $300 million in yearly revenue on product development and public health.

Recently, PATH partnered with MSR Global Health — a division of the outdoor gear manufacturer Mountain Safety Research — on a creative solution to fight waterborne infectious diseases: a portable, battery-powered device that can create enough concentrated chlorine solution to treat 55 gallons of water in one 7-minute cycle. Barely larger than a soda can, the SE200 launched last year. Shoultz said PATH is trying to get funding to manufacture the SE200 on a much larger scale as a community-level automated water treatment solution.

PATH is just starting other projects, Shoultz said, including the development of micro-array patches that can be used to deliver drugs, vaccines or contraceptives. The small patches, which could be used at home by the consumer, have miniscule needles that are so sharp they cannot be felt penetrating the skin.

“In our product development shop and in our in-country offices, it’s a deeply creative process,” he said. “We start with an identified health need in a low-resource setting. In some cases, the original idea for a solution to this problem is proposed by health professionals or innovators in a low- or middle-income country. Working together, we create new products using a highly iterative process.” – by Gerard Gallagher

Disclosures: Alexander is a spokeswoman for WHO. Bollinger, Rubin, Shoultz and Thomas report no relevant financial disclosures. Kettler is an economist for the Bill & Melinda Gates Foundation. Markham reports equity interest in Cyvax and has one patent issued and one patent pending that are related to these topics.