David's New Book

Wednesday, April 27, 2016

Australia, Antibiotics, Head in Sand

A recent news article from Australia that quoted my friend and colleague Matt Cooper caught my attention. The article notes the potential for an onslaught of antibiotic resistant superbug infections and talks about ways to counter this threat.  One topic discussed was addressing the market failure for supporting antibiotic R&D. That is, the market size remains too small for pharmaceutical companies to invest in antibiotic research.  Hence the pipeline of new antibiotics active against these resistant pathogens is nowhere near what it needs to be. Matt is quoted as saying that Australia needs to be paying into a sort of insurance fund that will go towards providing government support for an improved antibiotic marketplace. 
I wrote Matt to ask him what was happening in Australia. I noted my skepticism.  My doubts are based on Australia’s long history of fighting the pharmaceutical industry tooth and nail over pricing and patent exclusivity.  Australia has one of the shortest patent exclusivity periods for new drugs in the world.  It also requires companies to accept exceedingly low prices to be allowed to market their drugs in Australia.  Now the latter depends on how innovative a drug might be – but my experience is that now matter how active a new antibiotic is against resistant pathogens, it is never innovative enough to garner a reasonable price in Australia. Is a lower frequency of dosing for an antibiotic innovative enough? How about an expanded spectrum of activity including resistant superbugs?  Would a safer antibiotic be innovative enough?  In Australia – not necessarily. With a population of only 23 million, many companies are happy to walk away from the Australian market with their low prices and short exclusivity periods.

Back to the article in question. Given the threat of new and more resistant superbugs, what is the Australian government willing to do? The answer can be found in their strategy – here. Like most other government authorities, antimicrobial stewardship, surveillance for resistance and other such measures figure prominently in the Australian plan. Australia would also like to increase research funding for Universities and basic research – but Matt informs me that has not really happened yet. What is missing from the report is the very sort of incentives that the rest of the world, especially Europe, is considering seriously.  That is, providing incentive payments to those companies that do bring needed new antibiotics or other therapies to market that successfully combat superbug infections. Europe is looking at plans to provide payments of around $2 billion or so to companies who succeed as a way of guaranteeing that they will have a market.  The idea is to incentivize companies already in antibiotic R&D to continue, to provide a motivation for those who gave up antibiotic R&D to come back and to provide impetus to investors to support new company entrants to the field.

Whether Europe plans to do this on its own or whether they will be seeking other global partners is not totally clear yet. But - will Australia be participating?  As a country that has a long history of being part of the problem, it seems unlikely it will become part of the solution.