The Pasteur Act - A View from Industry

Chris Burns

 

Evan Loh

We will continue our discussion of the Pasteur Act as proposed by Senators Bennet and Young. Today I discuss the bill with two biotech CEOs, Chris Burns of Venatorx and Evan Loh of Paratek. Venatorx has a new antibiotic in phase 3 trials and Paratek won approval of their Nuzyra in 2018. Both expressed their appreciation to the Senators for bringing Pasteur forward. 

 

To remind you, a summary of the bill is here and the full bill (as it stands) is here.  As I noted in the last blog, the Pasteur Act proposes a subscription plan not dissimilar to what is being implemented in the UK and Sweden.  The plan will purchase a specified number of doses (or the rights to such) at some price over a multi-year period.  The total commitment proposed over up to 10 years is not less than $750 million and not more than $3 billion! The proposal only covers federally funded programs such as Medicare, Medicaid, VA, etc. There is a statement that encourages HHS to encourage participation by private payers . . .The bill is planned to assure sponsors that they will have guaranteed income in the absence of marketing – a delinkage between sales volume and revenues.

 

Everyone agrees with Chris Burns that waiting for market forces to increase investment and antibiotic R&D is futile. Both CEOs agreed (as do I) that Pasteur does not provide enough specifics for industry to judge how it will affect commercialization of their new antibiotics. They both offered a number of key questions and concerns. 

 

Pasteur does not address the need for hospitals to place the new drugs on formulary and to stock at least a small number of doses. Recognizing that the majority of US hospitals are under 200 beds and that these hospitals are often in dire financial straits, the payment required to stock drug may be too much of a burden. (The same would be true for the DISARM Act by the way). 

 

Chris Burns noted that since the entire subscription contract is with the sponsor, the list of pharmaceutical middlemen with their various price mark-ups is not affected. Evan Loh noted that in DISARM, by contrast, pricing is defined by the drug’s Average Sale Price or ASP. 

 

Chris Burns is looking for more clarity as to whether the subscription is for an actual number of courses of therapy (per year or per award period) or is more for a guarantee that the drug will be commercially and federally available in the distribution chain. He believes it is the latter. In that case, he accepts that if the government makes the annual subscription payments, it wants a “credit” back when it effectively pays a second time through normal distribution (e.g. through Medicare or Medicaid reimbursement).

 

He also pointed out that DISARM might work better IF one can achieve reasonable peak year sales because of the proposed reimbursement. He also notes that DISARM will work better (obviously) for those sponsors whose products might not qualify for the Pasteur subscription based on the proposed committee or panel to make these choices. Evan Loh suggested that this committee plan was, in fact, too opaque and would prefer that all QIDP products approved over the last five years be offered such a subscription automatically. I agree with both CEOs that the panel who makes this decision as to which products are deserving is too vague and will not encourage investors.  We need a much more transparent process such as designating top CDC and/or WHO priorities that are already well defined as criteria which might obviate the need for a panel.  FDA could make this determination. 

 

Evan Loh, as one might guess, strongly prefers DISARM.  His company has carried out interviews with key pharmacists who suggest that a promise of reimbursement would lead to a clear increase in positive formulary decisions for Nuzyra. 

 

Evan views Pasteur as complementary to DISARM depending on eligibility and process. The bill proposes transition measures that might be attractive but more clarity required.  For example, according to Evan, Pasteur should provide for a transition contract for all recent QIDPs in the range of $250 million. This will immediately help save small biotechs from bankruptcy at the moment of commercialization.  Evan suggests excluding big pharma (that we would need to define) from these transition grants. He further suggests that there be a post-acceptance review at some point such as is proposed in DISARM.  Above all, Pasteur must avoid the creation of impossible hurdles. It is clear to both CEOs that investors still lack confidence and it is not clear to them that either of these Acts, should they become law, will provide that confidence until data shows that they can provide for successful commercialization of needed new antibiotics.

 

I asked both CEOs about alternatives to DISARM and Pasteur. Both agreed that contracts for addition to the US strategic stockpile would be viable IF there were enough funds to make a large purchase comparable to the sums anticipated by Pasteur – something that does not appear to be the case currently. 

 

I specifically proposed a Hybrid Market Entry Award of ~$2 billion provided over the first five years post approval of a new antibiotic addressing CDC’s high priority pathogens. In this case the sponsor would be limited to charging a low (to be defined) price during those first five years. After that period, the sponsor would be allowed to gradually increase the price over the life of exclusivity of the product. The idea would be to provide a motivation for generic manufacturers to enter the marketplace after the end of branded exclusivity. Chris Burns thought that this would work much better than Pasteur, but noted that it is much less politically palatable. Evan Loh was skeptical that a sponsor would be able to increase prices enough to achieve the stated goal. 

 

Evan suggested a small, initial government investment that would be enough to get the sponsor to profitability after 2-3 years.  At that point the government could charge the sponsor a royalty such that the originating fund could become evergreen. Personally, I am skeptical that this would work in the absence of many more patients with resistant infections.

 

Conclusions:  There are too many questions around key aspects of Pasteur for industry to have confidence that it would work as intended according to both the CEOs I interviewed. However, both CEOs look forward to more development of the concept.

 

 

I am grateful to both Evan Loh and Chris Burns for spending the time with me to help clarify industry concerns around recently proposed government aid for the suffering antibiotic R&D community. 

Introducing the Pasteur Act for AMR

 

WARNING - This is long!

 

Today, I discuss the Pasteur Act, a new bill proposed in the US Senate by senators Bennet and Young, with Ryan Cirz. You can find a summary of the bill here and the full bill (as it stands) here. The Pasteur Act proposes a subscription plan not dissimilar to what is being implemented in the UK and Sweden.  The plan will purchase a specified number of doses (or the rights to such) at some price over a multi-year period.  The total commitment proposed over up to 10 years is not less than $750 million and not more than $3 billion! The proposal only covers federally funded programs such as Medicare, Medicaid, VA, etc. There is a statement that encourages HHS to encourage participation by private payers . . .The bill is planned to assure sponsors that they will have guaranteed income in the absence of marketing – a delinkage between sales volume and revenues. But, will it actually work that way?

 

Ryan Cirz:  We have a math problem in the field.  Revenues are limited by price x volume.  Durations of therapy are generally short, so volume is ~ number of patients.  Either price or number of patients must go up for products to be sustainable in the marketplace.

 

Enabling higher pricing is the focus of the DISARM act (an Act I believe is needed to make the PASTEUR act function properly and drive optimum behavior).  The low number of patients can be solved two ways:  just wait until there are more patients, or artificially bolster the economics by ‘buying’ access to more drug than you need at that moment in time – the latter is what I perceive PASTEUR as attempting to do. 

 

I’m sure some readers are thinking ‘if there aren’t that many patients, maybe there’s no need and we shouldn’t spend taxpayer money on this!’ – hey, maybe that’s correct.  I will say 37 years ago we decided <200,000 patients/year didn’t make a market, but we didn’t want to leave those patients without treatments – hence the Orphan Drug Act.  Here we are talking about a current market size where there are only 10,000 or 50,000 patients – and antibiotics cure people fast (unlike most orphan drugs) – so it’s no wonder the market is breaking.

 

If you are in the camp that you’d rather just wait until there are sufficient patients for the market to solve itself, it’s important to remember the vast majority of patients’ experience with an antibiotic is during its much longer lifespan as an inexpensive generic.  If you want those generics to exist in the future, there must be a way to reward the innovator companies (more importantly, their investors) during the short, branded years after launch – then 10-15 years later, when the market is big, society gets cheap access ad libitum.

 

There are other examples of this in the US.  One is the State of Louisiana’s subscription for HCV therapeutics for their Medicaid population. In that case, Louisiana guarantees a purchase of a specific number of doses of these drugs at a negotiated price (lower than the usual retail price). The company is guaranteed revenues upfront. The State saves money over the number of patients treated and – therefore – can treat more patients.  This is a win-win for taxpayers, patients and Louisiana.

 

1.     The subscription is for government payers only.  While this is a large number of very key payers (VA, Medicare, Medicaid etc), it does not include private insurers. The bill encourages HHS to encourage private payers to participate, but how will this work exactly in your opinion?

Full disclosure:  I have no idea how this will work – related though - I prefer a system with a de-linked incentive and a natural competitive market. My fear is, without some sort of competitive market, there will be regression to minimum standards to be eligible for a subscription contract.  There are infinite parameters that can be dialed when designing and developing a drug and without market forces, the pressure to strive for the very best you can achieve will be absent.  So I’m open-minded as we start to really experiment and get specific with these pieces of legislation but hoping we have a stabilized base of revenue from a PASTEUR-type system and perhaps leave the private payer market separate so there’s reason to compete to make the very best product – even within the subscription tiers – TBD as things unfold

 

2.     If I am a hospital pharmacist, when I order an antibiotic covered by Pasteur, will I need to pay the upfront price to stock the drug before being reimbursed by a payer one patient at a time?  I don’t know the answer to this and neither does Ryan (apparently). But I suspect that hospitals will have to pay upfront to stock the new drug.

 

3.    If I am a sponsor, will I need to work to get my product on the formulary (assuming I have to pay to stock the drug)? How much will this interfere with the presumed delinkage of the model?

 This is a great question because it costs a lot of money to support formulary review.  Pharmacists often depend on the sponsor to generate additional data beyond what’s in the approval package – sometimes even assembling the information for the hospitals.

DS here – In my view, Pasteur will have to have a contractual mechanism obligating sponsors to support formulary decisions in hospitals.

4.     If I am HHS, how will I determine how many doses to order and how do you see price negotiations progressing?

This is an open question I have – and where I could see things breaking down if there isn’t a normal competitive market to supplement the subscription.  The only super clear number to me is there will be an annual payment and the totals for all payments will range from $750M - $3B.  Also, revenues from federally insured will be subtracted, but at what unit price?  The only information is a price floor, which I assume is there to avoid enticing use over expensive generics like carbapenems. 

If there is a set number of doses that must be available, that imputes a price per course.  If the number of doses that must be available is determined based on disease prevalence, then could that entice people to go for the rarest condition as long as it qualifies for the highest reward? – why? - if I only have to supply super small numbers – I don’t have to worry about cost of goods, re-stocking, or frequent pharmacovigilance reporting…

It would be important to see just a bit more detail on the proposed mechanics here.  For a number of scenarios I can picture, having some component of a normal competitive market may help counteract some behaviors I could see going awry in a subscription-only incentive world.

6.  If I am a sponsor, how will this effect my development, post-approval development and marketing plans?

If PASTEUR passed tomorrow, for me at least - I’d say no change right away to the pipeline focus.  It will take quite a bit of time to spin up the committees and see how the different tiers are defined.  There’s even some funding to bridge that initial period – Pandemic stockpile purchases and contracts that could provide post-market development support.

 We need to see how this committee values different attributes – of course we can all predict the types of things that would drive value of an award.  HABP/VABP label > cUTI/cIAI; including non-fermenters is a higher value tier. (From DS – an oral cUTI drug active against high priority pathogens would also be1st tier I would think).  But nuances around narrow vs. broad spectrum (do I just need 1 non-fermenter or many?), what discounts apply to the almost infinite spectrum of safety considerations, and my fear novel mode of action, and not novel spectrum of activity will be the definition of novel could swing the incentive structure quite dramatically.

 So I’d do what I’ve always done – keep a diverse pipeline of assets at different stages of maturity so you can pivot as the rules change.  Perhaps some pipeline programs that clearly have no hope in the current reimbursement environment (say a narrow-spectrum inpatient only program) you might push a little further along at risk if legislation passes – but otherwise no immediate change until we see how value is defined.

 Post-approval plans – it seems obvious that one of the goals of PASTEUR would be to provide some incentive for label expansion.  While it’s not explicitly stated, there is language around ‘upgrading’ your subscription tier at a later date.  So for example if I come up with a drug active against CRE/CRAB/CRPA and initially develop it in cUTI, say that gets me the middle tier – but if I get a HABP/VABP indication later, I get the higher tier.  I do like that it creates incentives to keep studying the drug post approval – I know physicians want this.  It will be interesting to see if that could incentivize any adverse behaviors – for example delays to market:  HABP/VABP labels typically come several years after initial approval – so is it better to delay approval 5 years for 5 more years of top tier payments or get my 5 years of cUTI payments and then take 5 of the top tier?

 Again in the immediate term, it looks like there will be PBS-style contracts to bridge those companies that are nearing approval now – so I’d focus on making sure I’m in position for those as the idea is they’d cover the post-approval costs and purchase some drug to bolster initial revenues while we sort the rest of this out!

 

AMR and Europe - What Happened?

 Like many of you, I recently received a notification from John Rex and Kevin Outterson regarding the fact that many recently approved antibiotics will not be marketed in Europe. At first glance, I assumed that these products were simply unable to obtain a price that would provide for a return on investment leading the companies to abandon the European marketplace. But, based on the information provided by Rex and Outterson, its more complicated and more discouraging than that.

 

To go back in time, during the struggles at the FDA starting around 2000, Europe almost seemed like a haven of regulatory bliss for antibiotic developers.  Many of you will remember how antibiotics almost always were approved in Europe one or more years after their approval in the US during the last part of the last century. We viewed Europe as slow, cumbersome and driven by inconsistent and often academic concerns. But these perceived faults were clearly overcome when Europe became a regulatory haven as an alternative to an FDA that had lost its way. 

 

During my consulting years, that covered the worst of the FDA antibiotic crisis, I often advised my clients to work through European regulators primarily and put the FDA aside or at least on a lower priority in terms of trying to negotiate clinical trial designs that could lead to approval. My clients, perhaps correctly, noted that they would have a difficult time obtaining a return on their investment without the US market and as such, the FDA became a key hurdle for them to overcome. Unfortunately, years were lost in that struggle as were several of my clients. 

 

Then, in 2012, the FDA awoke from their state of hibernation realizing that the antibiotic pipeline had all but disappeared under their regulatory restrictions – especially for antibiotics targeting pneumonia and other serious infections. They quickly established new regulatory pathways that are more efficient and rapid for new antibiotics addressing resistant infections. 

 

And here we are in 2020.  Our antibiotic pipeline remains in shambles mainly due to a lack of a sufficient marketplace. But we must remember that “sufficient” depends on costs to get there and stay there. And costs, often, still depend greatly on the regulators. 

 

Nabriva will not market Lefamulin in Europe partly because it is unable to find a commercial partner to drive sales.  But more ominous in their recent SEC filing is the statement that they may not be able to continue to survive at all given marketing restrictions associated with covid plus outstanding obligations and debt. 

 

Plazomicin has been withdrawn from Europe apparently because the costs of the pediatric trials required in Europe “exceed all estimates of potential sales” in the region. 

 

Eravacycline is the victim of the financial difficulties of its parent company, Tetraphase, its limited indication and its relatively poor advantages compared to competing products. 

 

Paratek's omadacycline was withdrawn from consideration in Europe because the EMA insisted on a second trial in community-acquired pneumonia. Omadacycline was approved in the US based on two successful trials in skin infection and a single trial in pneumonia consistent with FDA guidelines for approval in both indications. FDA approved omadacycline for both indications but requested a second pneumonia study as a post-approval obligation. 

 

In the case of both omadacycline and plazomicin, the regulators have doomed the products for the European market. Some may argue that these products do not deserve to be marketed given the availability of other agents.  In fact, for omadacycline, that almost seems to be what the EMA is saying. On the other hand, the regulatory hurdles to the marketplace in Europe now become yet another nail in the coffin of new antibiotic investment in research and development. After placing so much hope in European regulators, I find I am profoundly disappointed in their actions. 

Too Little is not Enough

 

Those of you who joined the recent AMR conference or who receive John Rex’s very useful emails or who follow his website AMR Solutions will doubtless know that there have been recent advances in reimbursement programs in Europe for antibiotics. With all of the deepest respect for John and for Kevin Outterson in this regard, no one should believe that these tiny baby steps represent significant progress in the effort to fix the antibiotic marketplace. 

 

Germany, for example, recently allowed “reserve” antibiotics special exclusion from their general hospital diagnosis related reimbursement so the antibiotics can be reimbursed at a higher level. John and Kevin explain that this is a reversal from their previous stance that required new antibiotics to be reimbursed at levels similar to generic drugs unless they had shown superiority in clinical trials – something that can occur only rarely for antibiotics. They point out that France also has a DRG carve-out for antibiotics and that the US is contemplating one in the form of the DISARM Act currently before congress (as it has been for eons it seems). (Currently the US has a partial carve-out available through their NTAP program that I’m not sure anyone uses). Kevin and John note that Sweden has announced which antibiotics will benefit from their pilot study of a subscription payment model similar to what is contemplated by the UK. 

 

Is this all good news? I pose this question to myself and to you my readers. Some of this seems like national health authorities are motivated to do something to correct the antibiotic market but don’t want to do more than their country’s “fair share.”  This is similar to the DRIVE AB estimate of Europe’s “share” or “obligation” within the context of a global effort to provide a pull incentive for antibiotic R&D. But the major fallacy with all of these approaches is that there is no global effort to establish an appropriate pull incentive for antibiotic R&D. If the major economies of Europe, like Sweden and the UK, want to base a subscription model just on the need within their own population, we will ever get anywhere. Europe has to be Europe and provide for the needs of all its members from richest to poorest. 

 

And where does the US fit in all this?  Nowhere! Even DISARM, that is so enthusiastically supported by almost every antibiotic biotech I know will not, in my humble opinion, be nearly enough of a pull incentive. It is just another baby step limited by the rather small population who require targeted or even empiric therapy with new antibiotics active against resistant pathogens. 

 

DRG carve-outs and subscription models limited to today's needs of various national populations will not provide the kind of pull incentives we need unless all countries participate. To expect that they will is, at best, naïve and at worst, irresponsible. 

 

These approaches are hamstrung by the population at risk for resistant infections today. We need an approach today that looks forward to tomorrow.  None of these achieves that goal. We need incentives today that project our needs 10 years from now. We need to see this as an investment in the future, not a make-up payback for today. 

 

The optimists see the glass as half full. I see a desert with no water in sight. The optimists say this is progress.  We weren’t even contemplating DRG carve outs and subscription models or any pull incentive 10 years ago, they say.  True.  Ten years ago, the US did not even have a clear path for the clinical development of needed new antibiotics because the FDA was lost. Ten years ago, we were all focused on the FDA. 

 

So, you ask – what IS enough? We need a country or a region to take a leadership role and come up with a pull incentive for the world – for all of us. Otherwise, by the time a significant pull incentive comes from everyone’s desire to pay only their “fair share” we will have lost most or all of the antibiotic companies that remain.  We will be without protection when the resistance pandemic arrives. 

 

Too little is not enough!

Politics and the FDA

 If you are one of those who believe that the FDA is purely guided by science and that politics never has influenced its decisions or its very structure, you and I live on different planets.  By way of background, I recommend some reading.  First, there is a definitive history of the FDA written by Phil Hilts on the occasion of the FDA’s 100^th anniversary in 2003. He notes that the very early beginnings of what was to become the FDA goes back to Charles M. Wetherill – a chemist in the Department of Agriculture in 1862 who began to analyze substances in foods for toxins. Then came Harvey Wiley who started to try and convince lawmakers to act against the quack remedies harmful nutritional ingredients that had proliferated during the 19^thcentury. Wiley finally was appointed chief chemist in the Department of Agriculture around 1880.  At the turn of the century he established the poison squad – a group of young volunteers who tested foods and food additives on themselves (!). Wiley wrote much of the Food and Drugs Act of 1906 that was signed into law by Teddy Roosevelt. Looking back on all this early history, the laws passed after the civil war were often the result of political pressure from the obvious adverse effects of the various snake oils and remedies being promulgated at the time and that had resulted in sickness and death of US soldiers during and after the war. 

 

Back then, the early FDA could not actually pursue manufacturers or products until they had shown that a problem actually existed either via showing clinical harm or by demonstrating the presence of known dangerous substances. This is similar, by the way (and to the horror of many of us) to the way “nutritional supplements” are regulated (not) today largely thanks to Orin Hatch. 

 

This early approach changed dramatically in 1962 with the passage of the Kefhauver-Harris amendment to the Food and Drugs Act.  The impetus for this change was the devastation of birth deformities as the result of the use of thalidomide to control the nausea of pregnancy and the resulting political pressure for change.  This amendment required manufacturers to demonstrate not just safety but also efficacy of any proposed therapeutic.  

 

Fast-forward to the early 2000s and clinical trials to prove safety and efficacy of new antibiotics.  For years, the Infectious Diseases Society of America and the FDA collaborated in the promulgation of guidelines setting out the requirements for the design of these studies. Starting around 2000, the statisticians at FDA began to balk at the fundamental statistical foundation for the approach that had been used since the days of penicillin. That approach called for studies comparing a new antibiotic to an old, approved and standard of care antibiotic where the new drug had to be shown to be not inferior to the standard treatment.  This is quite different than other clinical domains where new therapies are shown to be superior to placebo.  As we all know, it is generally not acceptable to treat patients with a life-threatening disease (many if not most bacterial infections) with a placebo when we know that a safe and effective therapy already exists. Hence the so-called non-inferiority approach. The FDA then gradually tightened the statistical margins required resulting in increased costs of trials, lengthened time to market and decreased profits for new antibiotics. Then came the Ketek scandal of 2006 and the major involvement of politics in FDA “business.” Ketek (telithromycin) is an antibiotic developed by Sanofi for the treatment of pneumonia, sinusitis and bronchitis. It was approved in the US in a twisted set of data evaluations by the agency where, virtually uniquely, post-market safety data from Europe where the drug had already been on the market for a period of time was used to help justify the approval. After a year or two on the US market, several cases of severe liver injury were linked to Ketek and the scandal was born. Public Citizen cried foul relying on FDA insiders who objected to the way Ketek was approved to begin with. Public Citizen in turn pressured congress, especially representatives Markey and Grassley, to investigate the FDA. Markey and Grassley threatened the FDA with an investigation.  This resulted in FDA panic mode as they feverishly began to assemble all the documents and materials that such an investigation would require.  Rather than face the congressional investigations threatened by Markey and Grassley, FDA reacted by essentially carrying out their own investigation in public. There they crucified not only their own officials who led the approval of the drug, but also the clinical trial requirements for antibiotics. The latter response led to a point where it was no longer possible to carry out new antibiotic development and therefore where new antibiotics no longer had a clear path to approval. And all this was clearly based more on politics than the cold hard facts of the science. The FDA lost many dedicated and experienced antibiotic experts as a result of the Ketek scandal. This is all detailed in my book (you can just download the chapter on FDA if you want). As we all know, all’s well that ends well – but that was after at least six years of antibiotic development drought and the loss of hundreds of antibiotic researchers. 

 

Fast forward to covid.  OK.  Political influence might be erring on the side of less scientific stringency as opposed to more stringency – but there is no doubt that the FDA, as much as they claim to be science based, is susceptible to political pressure. And this is nothing new . . .

Policy - Coronavirus vs AMR

The coronavirus pandemic is clearly an acute and immediate pubic health crisis. Within the space of just a few months, almost 20 million people have had documented infections and over 700,00 have perished globally. The US alone accounts for almost 5 million cases and 162,000 deaths. In response to this public health catastrophe, the US along with the rest of the developed world (including China) have cobbled together an incredible effort to identify, test and distribute new vaccines and treatments. In addition to supporting research efforts (push incentives) many countries (especially the US) have been providing market support by ordering doses (hundreds of millions) of the various vaccines currently being tested in clinical trials (subscription model of a pull incentive). There is also a great deal of support for manufacturing at commercial scale (Operation Warp Speed) at risk before trial results are known (another key push incentive). I am not sure there is anyone out there who thinks that any of this is a bad idea. 

 

Now lets talk about antibiotic resistance (AMR). It is thought that there are currently about 700,000 deaths annually from AMR infections globally. That is – every year, year in and year out. This number is actually probably increasing every year. In the US alone, the CDC has estimated that there are about 3 million AMR infections occurring every year in the US and 48,000 associated deaths. Most experts, including yours truly, believe these numbers are clear underestimates. These infections also have a significant cost to the global and the US economies measured in billions of dollars. 

 

AMR infections have been with us since the dawn of the antibiotic era. Their numbers grow slowly every year and they are often hidden from view.  They occur in hospitals, in long term care facilities and in the community. But we don’t consider this a crisis.  Why? Because it has been going on so long?  Because AMR infections are a chronic and not an acute problem? Because the victims of these infections are somehow a lower priority? Because physicians are so used to dealing with AMR infections? Why is this not a crisis? 

 

And if we now agree that AMR infections is a slowly growing crisis, why can’t we put the kinds of resources into fighting the problem that we are investing in coronavirus?

 While there are a number of publicly funded sources of funding for research and development (push incentives), there is virtually nothing (including the efforts by UK and Sweden) to bolster the failed antibiotics marketplace sufficiently to provide developers with any sort of meager return for their efforts. 

 

Like many in our echo chamber, I am horrified and discouraged at the lack of action on the part of US and global authorities to address the failed antibiotic market. I am especially discouraged in light of our robust response to the coronavirus pandemic as compared to our lackluster response to the AMR crisis. I can only hope that we will learn from this pandemic that investing in our future is a much more efficient approach than reacting to a crisis while its happening. And I must hope that we apply this lesson to the growing AMR crisis. But will we do so? 

Infection Control - Is Medicare Helping?

Back in 2015, the Harvard group published an extensive study on the effects of Medicare’s punitive non-payment system for hospital acquired infections. The authors surveyed almost 400 hospitals or hospital systems for up to a total of over 28,000 unit-months.  They surveyed catheter-associated urinary tract infections and catheter-related bloodstream infections – for which Medicare had established punitive non-payment policies, and hospital-acquired pneumonia for which there were no punitive policies at the time. The results, shown in their figure reproduced below, show clearly that for all three infection types the, infection rates were already decreasing before Medicare implemented their policy and that the rate of decrease did not change after policy implementation for any infection type.  I concluded from these data that hospitals had realized that hospital-acquired infections were not good for patients and not good for their bottom line before Medicare’s policies and that the punitive measures did not accelerate the hospitals’ efforts to eliminate these infections. I was especially interested in these data since the small hospital where I volunteered on their infection prevention committee had incurred a punitive non-payment the year prior to the publication of the article. 

 

Fast forward to 2020. Authors again from the Harvard system once again examined the effect of Medicare’s punitive non-payment policies on infection rates. They specifically compared “safety-net” and non-safety-net hospitals. “In October 2014, these programs began comparing hospital performance on selected infection metrics with national benchmarks based on prospective infection surveillance data reported to the National Healthcare Safety Network (NHSN) of the Centers for Disease Control and Prevention. At present, HVBP rewards or penalizes the highest- and lowest-performing hospitals by up to 2%of the total inpatient payments the hospital received, whereas the HACRP reduces payments by up to 1% for the lowest performers.” In this case, the team examined data from 600 hospitals who submitted their data to CDC’s National Healthcare Safety Network (NHSN) system over the years 2013-2018. Once again, these punitive measures failed to improve the rates of all four nosocomial infection types studied. The authors suggest that these punitive measures have a relatively greater financial effect on safety-net hospitals for no appreciable gain in infection prevention. They also show that Medicare has learned little over the last decade of experience since implementing these sorts of punitive measures. 

 

I continue to believe that most hospital administrations understand that what is best for their patients is what is best for their hospitals and that they try and act accordingly.  While I am sure that there are exceptions to this, it is clear that the Medicare policies are now doing more harm than good. In order to further lower infection rates, we probably need a better understanding of the various factors that lead to increased rates, including patient risk factors, hospital staffing, and others such that we can direct hospitals to take the measures that are required to reduce rates further. It is one thing to apply a general policy without regard to the specific factors one seeks to alter and another to apply specific policies tailored to the needs of individual institutions.  I suggest that it is the former approach that is most needed.  

 

 

 

 

 

AMR Action Fund - a Bridge - to Where?

Yesterday, I listened to the global launch of the AMR Action Fund. The fund and its launch are also described in an article in the NY Times by Andrew Jacobs. Better yet – you can watch the launch here. In a way, this is a miraculous development that came to be under the leadership of Peter Beyer at the WHO. John Rex said he had tears in his eyes watching the launch. 

The AMR Action Fund, with pledges of $1 billion, was created by leading pharmaceutical companies and supported by the International Federation of Pharmaceutical Manufacturers and Associations (IFPMA). Investors include large companies like Merck who still carry out antibiotic R&D efforts and those like Eli Lilly which was one of the first to abandon the area around 20 years ago. These investors recognize the constant and growing threat of antimicrobial resistance.  They are cognizant of the lack of investment in the space that is leading to an inability to bring important new therapies to market and to threaten the very existence of those companies who attempt to do so. Their intent is to provide a bridge by funding the expensive phase 2 and 3 clinical trials and attendant development costs required to achieve regulatory success and market entry. Their goal is to bring 2-4 new, high priority antibiotics to patients by 2030. No wonder John Rex was moved to tears.

 But the AMR Action Fund investors also recognize that without government action, probably on a global scale, to put in place significant pull incentives their funding will be a bridge to nowhere. And this is where my own tears of sadness and despair come in. Much of the discussion focused on the DISARM act here in the US that would provide hospitals an add-on reimbursement for high-priced new antibiotics. But as I’ve stated many times in the past, this may only be a first, sort of baby step. Senator Casey, in his remarks, spoke of the GAIN act.  The regulatory components of that legislation were welcome – especially the requirements for feasible trial designs and for streamlined development and review for priority antibiotics.  The financial incentive – five years of additional exclusivity - was never an incentive for the vast majority of products with patent lives beyond a few years after approval. The DISARM act is restricted to those patients who actually need therapy in the hospital and may not, therefore, provide for the kind of fire extinguisher approach that we need.  (We pay for firepersons and extinguishers in the hope that we never need them). In fact, the presenter from Pfizer mentioned incentives such as subscriptions and transferable exclusivity vouchers. I agree with those choices in addition to a simple market entry reward contract. 

Without government action, we all understand that the AMR Action Fund, as inspiring and generous as it is, will be a bridge to nowhere. We all need to work harder to reach out to other stakeholders and bring them in to our cause before its too late. 

The FDA Revisits Community Acquired Pneumonia

The FDA just published an article examining the relationship between their early clinical response endpoint for community-acquired bacterial pneumonia as compared to the late endpoint of cure at test of cure currently required by the European regulators. Accompanying this article is an editorial by George Talbot who provides an analysis of the data and, more importantly, some historical background for the study. 

For those of us who lived through the nightmare of the FDA struggles with non-inferiority trial design throughout the years 2000-2012, reading the FDA study may be difficult. During those years, the FDA struggled with how to justify the so-called statistical margins used in clinical trials of antibiotics. The FDA wanted to be sure that the antibiotic effect was not similar to placebo, the statistical assumption that underlies all non-inferiority studies. They were also justifiably worried about the effect of prior, non-study antibiotics on the ultimate clinical outcome. This worry was clearly raised during a trial of daptomycin where the drug was inactivated by lung surfactant, yet appeared to work in a late stage trial.  That false sense of success was laid at the feet of short-term antibiotic therapy given prior to enrollment in the trial. These considerations led to a complete reconsideration of trial design for antibiotics in the treatment of bacterial pneumonia. 

The FDA’s reanalysis showed essentially what we already knew. There is a huge antibiotic effect in the treatment of bacterial pneumonia.  The effect is the greatest when looking at the early response to antibiotic therapy but is still large even when looking at later cure. In this case, the treatment effect for the early timepoint seemed to vary among different studies from 30 to 77%. The FDA decided that designating 20% as a conservative treatment effect would be OK after discounting for the fact that all these studies took place 80 years ago or more. These considerations ultimately led to a 12.5% non-inferiority margin for studies of community acquired bacterial pneumonia. 

To summarize, the FDA paper, that analyzes data from six recent trials, clearly shows that the early response endpoints, improvement in at least two of four specific symptoms (chest pain, cough, sputum production, and dyspnea) without any symptom worsening, and clinical cure (the late endpoint) agreed (success or failure) 86% of the time. That this would be true was predicted by the careful studies of the FNIH team lead by Talbot in 2011 and the FDA’s analysis documented in the guidance of 2014. A detailed look at the data reveals that discordant results may be explained. Early responders who had late failures were more likely to have severe chest pain on enrollment, infection caused by Staphylococcus aureus or Chlamydophila pneumoniae, or to have received prior non-study antibiotic therapy. 

Both FDA and Europe have already recognized the potentially confounding effect of prior non-study antibiotics in these trials.  Both agencies also recognize that a total prohibition of prior antibiotic use would render trials infeasible. So both, pragmatically, limit the number of patients and the doses and types of prior antibiotics that are allowed. 

The FDA concludes that the data they published provide an opportunity to reach international convergence on clinical trial design for the study of antibiotics in community acquired bacterial pneumonia. I presume that they would like Europe to adapt the current FDA designation of early endpoints as definitive. But the data could also justify the FDA accepting clinical cure as definitive. As a physician, personally, I would like to put the FDA’s perseveration behind me and go back to using cure at test of cure as the ultimate endpoint.  The concordance shown between the two endpoints is a tempting reason to do so and would make the most sense (in my humble view) to both patients and providers. But I cannot help but feel that the FDA would not agree with me. 

Talbot concludes that this kind of analysis is very useful both for physicians and regulators and he lauds the FDA for publishing the data.  I cannot agree more.  

I also need to recognize the role of George Talbot in leading us through the morass of the FDA’s trials and tribulations during those critical years so that we ended up in a place where we could once again pursue the development of antibiotics. I’m not sure how long we would have been in Neverland without his steadfast leadership and insight.