Subscription-Based Purchasing of Novel Antimicrobials


Looking to appeal to the financial incentives of antibiotic development, a recent policy paper explores how lives can be saved and a return of investment (ROI) can be realized.

Changing an existing model—even when it appears to have systemic flaws—can be extremely difficult, especially if there are no financial incentives to change course.

Within medicine, one example of this model is antimicrobial development and the limited number of new FDA approvals.

It has been an ongoing issue for years that public health policy experts, clinicians, and patients are keenly aware of—yet the current development model is not keeping up with multidrug resistant pathogens that are making the current crop of antibiotics less efficacious.

Yes, there is some very significant antibiotic development going on right now, and it is important to note some of these therapies will become FDA approved; however, the need to develop new antibiotics is continuous.

In March of 2021, the Pew Trusts published a report that there were 43 antibiotics in clinical development. Although this number seems significant, most of these therapies will eventually drop out of clinical trials, or some of these smaller pharmaceutical companies who are developing them, will declare bankruptcy. Additionally, only a handful of these antimicrobials will address gram-negative bacteria, which is the greater medical need.

Typically, it takes 10 to 15 years from development to FDA approval for antibiotics, but it only takes 2 years to develop bacterial resistance to new antibiotics. In the United States, more than 2.8 million antibiotic-resistant infections occur and at least 35,000 people die annually as a result, according to the CDC’s Antibiotic Resistance Threats in the United States report.

Read More: Cystic fibrosis patient advocate Gunnar Esiason spoke of how periodic bacterial respiratory infections throughout his life have caused him to build multidrug resistance to several antibiotics, leaving him without much of a safety net should he develop another infection. Check out his story here.

With the lack of financial incentives as well as the rise of multidrug resistance, it makes this sector of drug development a losing proposition.

Over the course of many years, almost all large pharmaceutical companies have exited the antibiotic development space. For the exception of a few bigger companies working on some novel antimicrobials, drug development is left to smaller biopharmaceutical companies who may only survive if their therapy gets to market.

Creating a Subscription Model
Although the current paradigm does not incentivize pharmaceutical companies to develop antimicrobials, there are suggested strategies for changing the way the system works. One of them is the subscription model where the federal government offers pharmaceutical companies financial incentives to encourage greater antimicrobial development, regardless of what the sales potential is.

“One particularly promising pull approach—so-called “subscription models”—would offer guaranteed annual payments to successful antibiotic developers delinked from sales volumes,” Rachel Silverman-Bonnifield senior fellow at the Center for Global Development (CGD), and Adrian Towse, director emeritus of the Office of Health Economics in the United Kingdom, write in a recent blog.

The idea is to create new antimicrobials to have them ready to be used, but is not contingent on sales.

“We want to make that a reliable reward for antibiotic developers,” Silverman-Bonnifield said. “It does not require them to sell a lot of the antibiotic.”

Their paper offers suggestions in how to elongate new FDA approved antibiotics.She points out they want to preserve these antibiotics and use them only when medically appropriate.

Silverman-Bonnifield and Towse wrote a policy paper, An Ambitious USG Advanced Commitment for Subscription-Based Purchasing of Novel Antimicrobials and Its Expected Return on Investment, which outlines how the subscription model for antibiotics could yield ROI.

They estimate that over the course of several years lives will be saved and a substantial return of investment can be realized.

Specifically, in their analysis they predict:

  • For every dollar invested would yield $6 dollars of value over the program’s first 10 years, and $28 dollars over a 30-year time horizon. 20,000 American lives would be saved over the next decade, and 383,000 over the next 30 years.
  • The global impact is even bigger—518,000 lives saved over the next decade, and almost 10 million by 2053.

In their paper, Silverman-Bonnifield and Towse explain that the new model would require cooperation with G7 countries. She says there are legislative movements in Canada, Japan, and the European Union looking to address the issue. And on a very small scale, the United Kingdom has a pilot subscription model going on right now.

Silverman-Bonnifield acknowledges it is hard to know if the countries will support this model, but she feels the United States could be persuasive if they are the first in line to do so. “I am cautiously optimistic that if the US moves, other countries will as well,” she said.

How does the PASTEUR Act Fit in?
A prospective federal legislative bill, The Pioneering Antimicrobial Subscriptions to End Up surging Resistance (PASTEUR) Act, looks to incentivize pharmaceutical companies using the subscription model approach. It was initially introduced in Congress by US Senators Michael Bennet (D-Colo.) and Todd Young (R-Ind.) in September of 2020. Bennet and Young along with Representatives Mike Doyle (D-Pa.) and Drew Ferguson (R-Ga.) reintroduced the bill in June 2021. The PASTEUR Act aims to incentivize innovative drug development targeting the most threatening infections, improve the appropriate use of antibiotics, and ensure domestic availability when needed.

Some of the specific components of the bill include:

  • Establish a subscription model to encourage innovative antimicrobial drug development aimed at treating drug-resistant infections. This model will be fully delinked, meaning that participating developers would not receive income, as a part of their subscription payments, based on volume or quantity of sales.
  • Subscription contracts would contain terms and conditions including product availability to individuals on a government health insurance plan, supporting appropriate use, and completion of postmarketing studies. These contracts could be valuated between $750 million and $3 billion.
  • Build on existing frameworks to improve usage of the CDC National Healthcare Safety Network, the Emerging Infections Program, and other programs to collect and report on antibiotic use and resistance data.
  • Include transition measures such as smaller subscription contracts to support novel antimicrobial drug developers that need a financial lifeline.

Silverman-Bonnifield and Towse explain in their paper that they did not explicitly model their strategy after the PASTEUR Act. “We construct an illustrative example from first principles, with parameters drawn (where possible) from the literature, and using some simplifying and deliberately conservative assumptions about program design and remuneration. Nevertheless, the results are indicative for the PASTEUR Act itself, or of any other similar initiative,” Silverman-Bonnifield and Towse write.

Silverman-Bonnifield is hopeful for the passage of the PASTEUR Act. “What we do see is a really encouraging amount of bipartisan support for this bill…I do think it would be a tremendously big step forward.”

Contagion spoke to Silverman-Bonnifield recently and she offered insights on her policy paper, defines what a social ROI is, and what passage of the PASTEUR Act would mean to antimicrobial development.

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