The bad business of developing new antibiotics
Everyone agrees that the world needs new antibiotics, as the number of drug-resistant infections continues to soar. But there's little agreement on how to finance their development, and the situation is deteriorating.
What to know: Antibiotics are a bad business, at least based on a current pharma model that's predicated on volume sales.
- Not only because health professionals believe new antibiotics should be used sparingly, so as to retard resistance, but also because some would be targeted at relatively rare infections.
- That's driven most incumbents out of the business, bankrupted some pure play developers, and scared off many venture capitalists.
- "Over the two years I've been here, the situation has become more dire," says Henry Skinner, a former Pfizer and Novartis executive who now leads AMR Action Fund, a $1.2 billion venture capital effort formed by Big Pharma to invest in new antibiotics developers.
Driving the news: AMR Action Fund has struggled to find investment opportunities, with Skinner saying the "pipeline is much thinner" than he had originally realized.
- But today it did announce a new deal: Plugging around $9 million into BioVersys, a Swiss company in the clinic with a product aimed at certain lung and bloodstream infections that kill up to 100,000 people per year. It also has early-stage programs, including one aimed at multidrug-resistant tuberculosis.
- For BioVersys, this is an extension to a Series C round announced last May. Skinner says the new money should be enough to get the company's lead product to Phase 3 trials, at which point he's "confident" that BioVersys would be able to secure adequate funding (including from AMR's deep reserves).
Look ahead: Skinner argues that new policies are needed, in the U.S. and elsewhere, to bring entrepreneurs and VCs back to the table.
- That could include passage of the bipartisan PASTEUR Act, which many had hoped would get a Congressional vote last year. It would create market incentives for pharma companies to develop new antibiotics, a bit like what the Orphan Drug Act did to facilitate that industry's development.
- Other policies could include new stewardship rules on physician prescriptions, to prevent such episodes as when COVID-19 patients received antibiotics for what was a viral infection (i.e., zero efficacy, but increased resistance). Plus on possible abuses in areas like aquaculture.
The bottom line: "We owe it to the next generations to have available to them what was available to us," says Skinner.