Biotech’s antibiotic warriors need new reward system in superbug fight

Small drugmakers account for 75% of all late-stage antibiotics in the R&D pipeline
Yet they face funding shortfalls and risk bankruptcy, leaving new medicines stranded
This new research shows some companies are finding novel ways to bring antibiotics to market

Small drugmakers face an uphill financial journey that can often sink their attempts to bring life-saving new medicines to market, resulting in bankruptcies and cutbacks.

Amsterdam, the Netherlands, 10 June 2021 - In the battle against drug-resistant bacteria, the world is more reliant than ever on a limited number of small and medium-sized biotechnology companies (SMEs), following the departure by many large drug companies from antibiotic development. Yet these smaller companies face a perilous financial journey that can often sink their attempts to bring life-saving new medicines to market, resulting in bankruptcies and cutbacks that further shrink the pool of new antibiotics available to humanity. New antibiotics and antifungals are urgently needed, due to rising rates of resistance. For example, the fungal superbug candida auris can be deadly, with the US Centers for Disease Control (CDC) reporting up to 90% of samples showing resistance.

A new report from the Access to Medicine Foundation, drawing on new data and discussions with stakeholders, examines how SMEs are navigating the tough conditions in the antibiotic market. It concludes that fresh incentives are urgently needed to head off a medical catastrophe, including the adoption of innovative subscription-based models.

SMEs are now pivotal in driving innovation in new antimicrobial development, accounting for 75% of all late-stage antibiotics in the R&D pipeline. But the low returns of this business – both in the price paid and the volumes used – means survival is a struggle, even for some companies with the most promising products in the pipeline and those that have successfully developed products.

The global-local nexus for improving access
Currently, 5.7 million people living mainly in low- and middle-income countries (LMICs) still die each year from lack of access to the right antibiotics – eight times more than the death toll from drug-resistant infections. In the same way that the world is discovering the global danger posed by coronavirus variants, failure to tackle the development of antimicrobial resistance (AMR) wherever it occurs will handicap the fight against drug resistance everywhere.

Significantly, some SMEs are now turning to partnerships with local companies in emerging economies such as China, India and South Africa to reach worldwide markets as they grapple with the so-called “valley of death”, when early research funding runs out before financial returns kick in. In fact, the report notes that China is a focal point for antibiotic development partnerships. This raises the possibility that China – already the world’s biggest producer and user of antibiotics – will play an increasingly important role in overall antibiotic supply in future.

"We have profiled four biotechs testing new ways to survive and bring their medicines successfully through the pipeline. They are finding partners in emerging markets willing to share the cost and risks of clinical development and commercialisation," said Fatema Rafiqi, who leads the Foundation's research in the AMR field. "This could kickstart the process of making new medicines accessible in emerging markets and neighbouring countries with unmet need."

SMEs are expected to navigate financial “valleys of death” – which starts when funding for early-stage research runs out and only ends if investors or Big Pharma start to show interest.

Bridging the valley of death
To fix the broken market, the world needs to provide both “push” incentives to encourage investment, such as funding for research, as well as “pull” incentives, in the form of improved financial rewards for launching new antibiotics.

Encouragingly, some countries are now piloting novel systems that aim to do this by delinking payments from the volume of drugs used. Sweden is experimenting with a subscription model where regular fees are paid in return for on-demand supply, similar to a TV streaming service; Britain uses this concept to pay for antibiotics based on their overall value to the health system; and the U.S. is working on two reforms that would effectively establish a subscription system based on upfront payments.

But more countries must follow suit – and, crucially, the world needs to ensure that people in LMICs, where rates of drug resistance are particularly concerning, are not left behind.

"Better incentives are urgently needed to support the few drug developers still committed to the antibiotic and antifungal business. Yet smaller drug-makers cannot wait for incentives to materialise. A global approach to growth will help them unlock new funds and to de-risk the development and commercialisation phases, while governments and other donors bring new incentives on stream." –Jayasree K. Iyer, Executive Director of the Access to Medicine Foundation.

With only 55 antibiotics in late-stage development, each one must be protected from misuse and overuse.

Planning to prevent the silent pandemic of AMR
The COVID-19 pandemic has shown clearly that the world needs to be better prepared for emerging global health threats. Antimicrobial resistance (AMR) is just such a threat – and unlike COVID-19 is it very predictable. Indeed, the world is already experiencing a slow-burning or “silent” pandemic of AMR, with an estimated 700,000 people dying every year from drug-resistant infections.

With only 55 antibiotics in late-stage development, each one must be protected from misuse and overuse to ensure that it stays effective for as long as possible.

In its concluding section, the report emphasises that advance planning for stewardship and access must become a standard step, before an antibiotic hits the market, to ensure the new medicine is swiftly protected by stewardship measures while being rapidly deployed to the people who face the highest risk from resistance.

Getting the right antibiotics to the people who need them, wherever they live, is essential if the world is not to head back to a time when simple wounds could be lethal and common surgery procedures too risky to undertake. If promising new antibiotics continue to be stranded in the lab, or if product developers fail to plan ahead for stewardship and access, the pandemic of drug-resistant infections could pose a bigger global health emergency than COVID-19.