David's New Book

Tuesday, November 16, 2010

Antibiotics, Incentives and Disincentives - continued.

Going back to that article by Andy Pollack in the NY Times, he includes a graphic from the FDA showing a substantial increase in the number of new antibiotics entering clinical development over the last few years. I think it is worth taking just a few minutes to put this in perspective.  It is absolutely true that the number of antibiotics entering the pipeline is increasing – especially in 2008 when a record 14 new molecules entered development in the US.  But, having looked at the same data from the FDA, I note the following.  The average for the decade between 1990-1999 was 4 new antibiotics entering clinical development per year.  For the last decade (2000-2009), it was 5.7 molecules per year – a 42% increase.  The worst period was the years between 1996 and 2003 when only 3.25 molecules entered development per year.  In general, only 1 in 5 of such molecules will make it all the way to the marketplace, and it takes say 7-10 years to get there once clinical trials start. So, for the next decade, at best, we can expect new antibiotic approvals to still be in the range of about 1 per year.  This is still 3-4 fold worse than during the 1980s.

The other point I wanted to emphasize is that these molecules are mostly entering at the earliest stage of development, Phase I.  A few are entering already at a later stage, Phase II.  But neither of these stages is really expensive.  So most are coming from biotech companies who will not have the means to develop the molecules beyond Phase II.  Phase II trials cost, say, $6-10 million.  Phase III trials, and you have to run two of these for each approved indication you want (with a few exceptions), cost on the order of $35 million when all is said and done.  Biotech investors cannot support this level of spend. Phase III trials must be funded either by public markets or by large pharmaceutical companies.  The former is still essentially non-existent.  The latter is a rapidly dwindling resource, especially for antibiotics.  So, incentives for both large and small companies are still needed, even if there are encouraging signs that the number of new antibiotics entering clinical development in the US is increasing.

An Op-Ed in a recent Boston Globe calls for an incentive combined with a sort of disincentive.  I have been unable to read the full article (since they actually want to charge me money!), but I think I understand what Drs. Kesselhem and Outterson are getting at.  What they claim is that pharmaceutical companies inappropriately market, or at best fail to appropriately market antibiotics such that abuse is encouraged to feed their bottom lines.  They argue that antibiotics are underpriced relative to their value to society.  I have one word from Drs. Kesselheim and Outterson – Zyvox.  Zyvox is an antibiotic that is priced to reflect its high value in the fight against MRSA and also to tie it to use only when an MRSA infection has been documented or at least is highly suspected.  Otherwise, no one would pay the price they charge.  The same is true for a number of antibiotics used in hospitals that are only available intravenously.  The argument that antibiotics are cheap usually refers to those used for infections in outpatients in indications that are, essentially, no longer considered valuable by the FDA – ear infections, bacterial bronchitis and acute bacterial sinusitis. In those infections, there is no longer a question of price since it is not feasible to develop antibiotics to treat them at the present time.

The idea of providing a disincentive, though, to pharmaceutical companies who abandon antibiotic discovery and development is not new.  Dr. Louis Rice suggested this a number of years ago.  He calls it both an antibiotic abuse tax – to make companies pay for the years they allowed patients and physicians to abuse antibiotics by using them when they were not necessary – and a disincentive for abandoning the field.  In this way, companies who continue to try and discovery and develop antibiotics would be exempt from the tax.  Combining this kind of disincentive with the kinds of incentives the London School of Economics has proposed for antibiotic discovery and development would be reasonable.  Although I think the incentive alone would be enough, the tax would help pay for the incentive – making it more palatable politically.  Then again, didn’t we just elect a very anti-tax congress?