The Antibiotics Market is Broken – Can We Fix it?

Antibiotic resistance is classified by the WHO as one of today’s biggest threats to global health. As commonly used antibiotics become less effective, a growing body of treatable infections is now claiming more than half a million lives each year, a death toll on the rise. Experts warn that we are entering a post-antibiotic world in which minor infections could once again become life-threatening, a concern compounded by the lack of innovation in the market for new molecules. 

Alexander Fleming’s 1928 discovery of the first antibiotic, penicillin, marked a turning point for public health and the world economy. Once deployed on a massive scale throughout the post-war period, antibiotics consolidated the affluence of the Western World by enabling increasingly safe medical procedures, facilitating the industrialization of global food production, and curbing the death toll of infectious diseases. After decades of over-prescription and misuse, however, our antibiotics are worn out – and the microbes they target are all the more dangerous.

To understand why commonly used antibiotics aren’t as effective anymore, we should return to fundamental principles of natural selection. Over time, certain bacteria have evolved resistance due to the selective pressure of antimicrobials in their environment, like the human body or industrial meat farms – survival of the fittest, but for microscopic organisms. We are now seeing this phenomenon replicated on a massive scale as more disease-causing bacteria acquire resistance, often against multiple drugs at once, and spread around the globe.

The demand for new antibiotics is higher than ever, but since the golden age of antibiotic discovery in the 1950s and 1960s, the pipeline has dried up. In fact, many major players in the pharmaceutical industry have fled the business entirely. Today, just four companies – GSK, Novartis, Teva and Mylan – operate half of the world’s 200 antibiotic manufacturing plants. Yet most new compounds in development are coming from a handful of small biopharma companies, the majority of which have never commercialized a product. The overarching reason is simple: today, putting a new antibiotic on the market is an economic black hole.

In April of 2019, biopharmaceutical SME Achaogen announced it was filing for Chapter 11 bankruptcy due to slow sales of their new antibiotic plazomicin, which had been approved by the FDA only a year earlier. Among the other antibacterial compounds in their pipeline, Achaogen’s drug successfully targeted multidrug-resistant (MDR)Enterobacteriaceae infections, which are among the most difficult to treat. Just months later, drug maker Melinta Therapeutics became the second antibiotics developer in 2019 to be forced into bankruptcy; sales of the company’s delafloxacin, released to treat bacterial pneumonia, were too low to keep the company afloat.

This string of bankruptcies reflects a growing trend within the industry that has public health officials worried. The healthcare system can’t afford to lose any antibiotics to unsustainable market forces, particularly during the pandemic as secondary bacterial pneumonia affects many COVID patients. An analysis by the Tufts Center for the Study of Drug Development estimated that today, the average drug requires $2.6 billion of R&D and 20 years to commercialize – plus another 15 years to see any profit. Even then, only a small fraction of candidates make it past initial research stages. If companies that manage to successfully market new antimicrobials go under, taking their drugs with them, the future of modern medicine is in serious jeopardy.

The paradox of antibiotic development involves a delicate balance between economic incentives and healthcare practices. Hospitals are generally reluctant to add new antibiotics to their inventories when cheaper alternatives already exist, instead opting for alternating antibiotic regimens. The real challenge arises when multidrug-resistant pathogens emerge in these hospital settings, where novel antibiotics are explicitly kept as last-resort treatments for when older generations of drugs don’t work. Antibiotic stewardship programs make sure of this: their goal is to delay the onset of resistance to new drugs as much as possible by reserving them for patients with highly resistant infections. From a scientific perspective, this is a wise strategy; however, the practice dramatically shrinks profit margins for the company manufacturing the drug, ultimately putting its long-term availability at risk.

It’s worth noting that antibiotics are generally used for short periods to resolve acute infections, in contrast to highly profitable drugs for chronic diseases, such as diabetes and high blood pressure, that can be prescribed for much longer. Large pharmaceutical groups and investors are also wary of the increasing speed at which resistance to new compounds arises. The first case of resistance to penicillin was reported after 20 years on the market; but since 1996, any new antibiotic has seen an emergence of resistance within 5 years, in some cases in a matter of months. This is because the newest antibiotics are, for the most part, modified versions of older compounds rather than entirely novel classes of molecules.

The consequences of a post-antibiotic world would be devastating. Fewer effective antibiotics translate to longer hospital stays and more expensive treatments, the effects of lives lost to resistant infections will ripple out to the whole economy, and hospitals will see their income dry up, as antibiotics are an essential component of almost every surgical procedure. The question at the heart of the antibiotic paradox is therefore how to incentivize companies, large or small, to invest in research & development. "The market, if left alone, will not fix itself," Allan Coukell, Senior Director of Health Programs at the Pew Charitable Trust, said in a statement. 

Prompted by the Achaogen and Melinta bankruptcy events, senators Johnny Isakson (R-GA) and Robert Casey (D-PA) drafted the Developing an Innovative Strategy for Antimicrobial Resistant Microorganisms (DISARM) Act. It was designed to address the lack of financial incentives to develop new antibiotics, proposing to expand insurance coverage of new compounds under Medicare, as well as outlining strategies to preserve the effectiveness of existing compounds. Similarly, the Antimicrobial Resistance Benchmark has been working to incentivize large drug companies to invest in antibiotic development, to some degree of success: pharma giant GlaxoSmithKline currently has two new compounds in phase 3-4 clinical trials amongst its 27 R&D projects, and other large groups like Merk and Johnson & Johnson follow close behind. The pipeline is slowly expanding, but not nearly enough to safeguard the future of the industry.

One circulating idea has been the generation of a $1 billion market entry reward, spread out over five years to companies developing a new antibiotic and awaiting regulatory approval. In that same vein, talks of extending the exclusivity period on these drugs, typically around 20 years and granted by a patent, have gained traction in the industry. And on the research front, scientists are looking for alternatives to antibiotics like bacteriophages – viruses that infect and kill bacteria – or turning to AI-based drug discovery as a way to cut R&D costs. Nevertheless, more concrete work is needed from policymakers and major players in Biopharma to step up to the antibiotics crisis before it's too late.