Why The Next Novel Antibiotic Will Be A Blockbuster And Cost $40k

The Next Golden Bullet

Looking at all antibiotics in the pipeline, I can’t help but think that – by 2018 – there will be some blockbuster anti-infectives coming to the market. Why do I say this?  What is going to generate this revenue stream for companies when the new crop of drugs will be restricted by label, by formularies, and probably by a very limited activity spectrum? Because we have a convergence of several factor, all of which point to a great opportunity for companies willing to take on the risk, spend the money, and make the necessary development effort.

Here is my rationale: Available antibiotics are already losing ground against pesky MDR pathogens and there will be an ever-increasing shortage of effective drugs as time goes on.  Let’s be realistic and assume that we can still handle most problem pathogens for another 5-10 years.  The emphasis is on ‘most’: there will be a growing number of lethal XDR bugs that defy anything but surgery or fire. Any antibiotic – even narrow in spectrum – will be looked at as ‘the savior’ in these dismal cases.  And rare cases can mean profitable business.

Our colleagues in orphan drug development have shown that there is no segment too small for a life-saving drug to become a blockbuster. Look at Alexion or Genzyme. Would you have thought that drugs for Paroxysmal Nocturnal Hematuria (PNH) or Gaucher’s disease could be this profitable?

Actually, we only remember the price escalation brought about in the HCV area.  For example, in 2007, a 48-wk treatment course of Peg-IFN plus ribavirin cost approx. $35k, made you feel pretty miserable, and gave you a 40-50% chance of cure. Compared to that, the new Gilead drug, sofosbuvir (Sovaldi®) with its $82k price tag is a bargain even in combination with other expensive drugs: the new Direct Acting Antivirals (DAA) can achieve cure rates of 95%, are vastly better tolerated, and treatment is reduced to 24 weeks or less.  I consider that real progress.

Looking over the fence at other therapeutic areas we see prices unheard of in the anti-infective arena.  A cancer agent which only improve Progression-Free Survival (PFS) can cost $40k. By contrast, a 2 week prescription of linezolid, one of the most innovative and expensive antibiotics, costs ~$1000.  And daptomycin, our best MRSA drug so far, is to be had for ~$300 / day.

The business model for ‘curative’ therapeutics like antibiotics is broken and needs to be changed.  This was the assessment and recommendation from the London School of Economics back in 2009 already (1).

The next group of me-too drugs hitting the market will not ‘rock the boat’ of current pricing standards too much.  Although some will bring significant improvements in pharmacokinetics they offer no quantum leap in efficacy profile.  I am oversimplifying a bit here but these drugs cannot set prices without looking back at linezolid, vancomycin, or penem antibiotics as references.

Now, such backwards price point comparisons would not be meaningful for the next drug against, say, enterococci, acinetobacter, or what is known more broadly the ESCAPE (2) pathogens. Think about it this way:  If you have an immunocompromised patient in the ICU who has XDR Klebsiella sepsis despite several courses of exotic antibiotic cocktails, you would want to have a Sovaldi-cillin or Sovaldi-mycin to give to that  patient.  I know you would.  And pay the sticker price that it comes with.


(1) Mossialos: http://www.lse.ac.uk/LSEHealthAndSocialCare/impacts/LSEHealthNews/News%20Attachments/Policies%20and%20incentives%20report.pdf

(2) ESKAPE = Enterococcus faecium,Staphylococcus aureus, Klebsiella pneumoniae, Acinetobacter baumanii, Pseudomonas aeruginosa, and Enterobacter species

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