Changing the Antibiotic Reimbursement Model to Encourage Drug Development Proliferation


Although the current reimbursement model makes it difficult for pharmaceutical companies to recoup their investments, a subscription model like the prospective congressional bill, the Pasteur Act, may help change that paradigm. In addition, there are international measures being carried out that may bring about changes.

One of the biggest, ongoing challenges within antibiotic development is the current model in which pharmaceutical companies are reimbursed vs therapies for other types of disease states.

“You bring an amazing cancer drug to market, and they sell as much of it as they can for as high of a price per unit as possible,” Kevin Outterson, JD, founder and executive director, Combating Antibiotic-Resistant Bacteria Biopharmaceutical Accelerator (CARB-X), said in an interview with Contagion. “For antibiotics, if there's an amazing new antibiotic for fairly good public health reasons, we want to limit the use of it. We want to use it only in the patients that absolutely need it, reserve it for the future—we call this stewardship...So the volume is going to be low, unless we're in some sort of incredible public health emergency. The price is also going to be low, because generic antibiotics are relatively inexpensive. The new antibiotics compared to cancer drugs—even though they're more expensive than generics—they're still very affordable for saving a life. So there's pressure on both the volume and the price."

CARB-X is an organization that aids in funding the early development pipeline of new antibiotics, vaccines, rapid diagnostics, and other products. In addition to CARB-X, there are other organizations working to get the US government to pass legislation that would incentivize pharmaceutical companies to develop antibiotics.

Just this past week, the Infectious Diseases Society of America (IDSA) had its 2023 Leadership Summit in Arlington, VA, which is a three-day meeting for board members and volunteer leaders to connect and collaborate on ID workforce strategies and other top priorities of the organization. During this summit, IDSA members went to Capitol Hill to talk to Congressional leaders and their staffs about antimicrobial stewardship and specifically the Pasteur Act. For those not familiar with it, the Pasteur Act is a prospective bill that looks to encourage innovative drug development targeting the most threatening infections, improve the appropriate use of antibiotics, and ensure domestic availability of antibiotics when needed.

The Pasteur Act would establish an innovative payment contract (subscription model) where the federal government invests in highly novel antibiotics and antifungals through installment payments in exchange for free access to developers’ drugs in government programs once available.

The bill was initially introduced in Congress in 2020, then reintroduced in both 2021 and earlier this year. When it was reintroduced back in April, five national organizations, the Biotechnology Innovation Organization, the Cystic Fibrosis Foundation, IDSA, the Partnership to Fight Infectious Disease, and The Pew Charitable Trusts, issued a joint statement on the topic.

“Antimicrobial resistance is not a partisan issue. It is an increasingly challenging public health emergency that reverberates far beyond just health care settings. Every 15 minutes, a person in the United States dies from an infection resistant to treatment with existing antimicrobial drugs. This means that since PASTEUR’s last introduction on June 16, 2021, more than 64,000 Americans have died because they did not have adequate medications to treat their infections,” part of the statement read.

International Measures

Those involved with advocacy for pull incentives for antibiotic development believe it is still building consensus towards what everyone hopes will be an eventual vote in Congress on Pasteur. Internationally, there has been inroads made as well.

“Governments have taken positions on pull incentives. The G7 health ministers declaration from Tokyo this year clearly supported pull incentives," Outterson said. "A pull incentive, like the Pasteur Act, was in the president's budget, and it's a bipartisan bill in the US Congress. Europe announced a proposal from the commission officially to embrace a pull incentive, broadly similar to the Pasteur Act, but adapted to European circumstances…Canada announced the end of their one-year process that I participated in, [which was] revenue guaranteed pull incentives for antibiotics in Canada.” Outterson also mentioned the United Kingdom is participating in a pull incentive pilot program.

Contagion spoke to Outterson at the World AMR Congress and he discussed CARB-X's work and the importance of incentives.

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