19 May 2016   |   Viewpoint

We need to radically overhaul antibiotic R&D, says superbug review

The world needs a global plan to tackle antimicrobial resistance. Alongside a $2B fund to jump-start innovation there should be a $1B reward for companies when a new antibiotic is launched, says Jim O’Neill, chair of the review

"We need to tackle the supply problem." So says Jim O'Nell, chair of the UK Antimicrobial Resistance Commission, in his foreword to its final report, published today. 

That means providing incentives for the pharma industry to invest in developing new antibiotics, to overcome the problem that currently it is hard to get a return on investment in antibiotic R&D.

The world market for antibiotic drugs is a handsome $40 billion per annum, but only $4.7 billion of this is spent on high-cost patented drugs. By comparison, the biggest selling drug in the world, the rheumatoid arthritis treatment Humira has annual sales of $11 billion.

There are also market distortions to confront: rather than seeking to maximise sales of a new antibiotic – which would mean it loses effectiveness sooner – there is a need for stewardship to slow the inevitable development of resistance.

“It is no wonder that firms are not investing in antibiotics despite the high medical need,” O’Neill says. “This will not change until we align better the public health needs with the commercial incentives.”

A few statistics underline the lack of incentives. In 2014 there were 800 cancer drugs in development compared to a total pipeline of less than 50 antibiotics. Of $38 billion in venture capital invested in pharma R&D from 2003 – 2013, only $1.8 billion was devoted to antibiotic research.

In terms of spurring innovation, public funders show similar bias. As the largest funder in the world, the US National Institutes of Health awarded just 1.2 percent of its grants for research in antibiotics, compared to 18.6 percent for cancer, between 2009 – 2014.

It is nearly 30 years since a new class of antibiotics was introduced and the situation is becoming dire. Resistant strains of bacteria are spreading, threatening to make existing drugs ineffective. If this happens, key medical procedures such as gut surgery, caesarean sections, joint replacements, and treatments that depress the immune system, like chemotherapy for cancer, could become too dangerous to perform.

Failure to tackle drug-resistant infections could lead to at least 10 million extra deaths a year by 2050 and end up costing the global economy up to $100 trillion. “It is fair to assume that over one million people will have died from AMR since [the review] started,” says O’Neill, former chief economist at Goldman Sachs, who is credited with coining the acronyms BRIC (Brazil, Russia, India, China) and MINT (Mexico, Indonesia, Nigeria, Turkey).

Better incentives

To create incentives, companies that develop new antibiotics should receive ‘market entry awards’ of $1 billion, so they recoup the cost of R&D as soon as a drug is launched. The money would be paid on condition that companies are responsible for stewardship, ensuring antibiotics are available when needed, but not over-used so they lose their effect.

The market entry awards would be funded by an antibiotic investment charge levied on the pharma industry. This would be on a ‘pay or play’ basis, meaning companies that are active in antibiotic R&D do not pay the charge.

This would de-link profit from the volume of sales and make development financially sustainable. Before proposing the market entry award, O’Neill ruled out a number of other potential interventions, including patent life extension and relying solely on higher prices to stimulate R&D investment and constrain consumption.

O’Neill recommends the G20 group of countries should take the lead in setting up the market access award.

At the same time a $2 billion global innovation fund is needed to kick start a new cycle of early-stage research and generate inputs for pharma industry pipelines. China and the UK have already pledged $72 million to the fund.

The proposed incentives could lead to 15 new antibiotics a decade, of which at least four should be breakthrough products for infections including tuberculosis and gonorrhoea.

To protect the effectiveness of new and existing antibiotics, the report calls on the governments of the richest countries to mandate that by 2020, all antibiotic prescriptions will need to be informed by up-to-date surveillance information and a rapid diagnostic test wherever one exists.

“I find it incredible that doctors must still prescribe antibiotics based only on their immediate assessment of a patient’s symptoms, just like they used to when antibiotics first entered common use in the 1950s,” says O’Neill.

Such a government mandate, “will open the door to investment and innovation, by showing clever developers that if they build rapid tests they will find a market for them.” The report estimates that $1 - $2 billion a year to support takeup “would make a very material difference in these areas.”

Reduce use of antibiotics in agriculture

Alongside the effort to increase supply, there is a need to supress demand, with O’Neill calling for much faster progress in reducing the use of antibiotics in farming.

There is far greater use of antibiotics in animals than in humans.  In the US, more than 70 percent of antibiotics use is in animals, with only 30 percent in humans. Agricultural use must be reduced globally and there should be stricter rules on the type of drugs used in agriculture, depending on their importance to humans.

Governments should set targets to reduce the use of antibiotics in agriculture. Large food companies could play a role here by prohibiting certain antibiotics in food production.

To underpin and reinforce the need for these initiatives, there should be a global awareness campaign, with a budget of between between $40 and $100 million a year. “I think this is something that could, and should, begin this summer if we are to really make progress on AMR,” O’Neill says.

The cost of global action

The cost of the global action plan on AMR is up to $40 billion in the next decade. Governments are recommended to cover the cost of addressing AMR by shifting money from existing health budgets. Committing funds to AMR now will reduce the amount it costs later when it develops into an even bigger crisis, which will inevitably fall to governments.

“The costs of what we present here for mounting an effective pre-emptive response [to AMR] are substantially lower than the expense of responding once it becomes a true public health emergency,” O’Neill concludes.

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