{"id":932,"date":"2014-09-26T12:40:42","date_gmt":"2014-09-26T16:40:42","guid":{"rendered":"http:\/\/allphasepharma.com\/dir\/?p=932"},"modified":"2014-10-03T12:36:24","modified_gmt":"2014-10-03T16:36:24","slug":"its-not-a-free-enterprise-market-stupid-part-1","status":"publish","type":"post","link":"https:\/\/allphasepharma.com\/dir\/2014\/09\/26\/932\/its-not-a-free-enterprise-market-stupid-part-1\/","title":{"rendered":"It\u2019s Not a Free-Enterprise Market, Stupid!"},"content":{"rendered":"

\"Money\"<\/a>The economics of developing antibacterials is a frustrating topic to address.\u00a0 There are unique aspects to the antibiotic market which sets it apart from other medicines, esp. the unique societal aspects of antibiotic use which go beyond the benefit to the individual.<\/p>\n

IDSA has spoken out in various publications (\u201cBad bugs, no drugs\u201d, \u201910 x\u00a0\u201820 initiative) about the various disincentives for industry to engage, so I only mention\u00a0a few key points: the loss of efficacy\u00a0over time due to resistance development; the short treatment courses of curative vs the life-long dependence on palliative medicines; high regulatory hurdles for the development of drugs against MDR pathogens; the lack of international harmonization of endpoints for regulatory approval.<\/p>\n

Industry is good at developing and marketing but will not invest in a product that is\u00a0going\u00a0to be restricted, get labeled as a 3rd<\/sup> tier ‘reserve’ agent, or which is undifferentiated and replaceable with a generic. \u00a0For them, the ideal “Target Project Profile” looks more like this: \u00a0Broad therapeutic and prophylactic use, plus empiric use, with broad-spectrum activity across multiple indication, and IV and PO formulations for step-down use. The last group of drugs that came close to this profile\u00a0were the fluoroquinolones.

\u201cReward companies for innovation in antibiotics. Both Push and Pull incentives are needed\u201d LSE [2]<\/p>\n<\/div><\/p>\n

CEOs are under the gun to deliver profits to shareholders, they don\u2019t get a bonus check for being \u2018do-gooders\u2019. \u00a0Until recently, the only way for antibiotics to generate profits\u00a0commensurate with cancer, diabetes and asthma drugs, was to\u00a0market them for mass consumption. \u00a0Nowadays, only the\u00a0orphan drug pathway is somewhat attractive for Big Pharma to\u00a0engage.<\/p>\n

I got thinking about this topic as I read the \u2018Perspective\u2019 by Laxminarayan in Science [1]<\/a>. The author makes the point that\u00a0\u201ccontrary to popular belief, many new antibiotics have been introduced during the past two decades\u201d. \u00a0His opinion seems based on the list of antibiotics provided\u00a0in Fig. 3 of the article which unexplicably\u00a0mentions\u00a0drugs that\u00a0never made it in the US . Such factual errors create the false impression of a vibrant industry effort where there is actually very little. He then makes the case for investments in education, in diagnostics, in vaccination, and for prudent use, all truisms we are familiar with and which everyone can support.<\/p>\n

Regrettably, this \u2018Perspective\u2019 does not provide new ideas how market forces and regulations can be shaped to create a healthy balance that would encourage innovation, keep resistance at bay, and avoid making the next decade the first of the post-antibiotic era. \u00a0(I still recommend reading the article as\u00a0it has some nice\u00a0color graphs and tables).<\/p>\n

As a non-MBA, non-Econ major, I see an\u00a0antibiotic market that is regulated to the hilt in certain areas (human use)\u00a0but\u00a0not in others (veterinary use). \u00a0Investors have\u00a0to\u00a0live with the occasional\u00a0ice-bucket challenge from FDA which<\/p>\n

However, not all is bleak:\u00a0 In their heart of hearts, industry likes antibiotics because efficacy read-outs can be obtained so much earlier than for any other medicine class.\u00a0 Antibiotics have always been good for risk-mitigation in a diverse portfolio, and they make very good PR. \u00a0Think Novartis (Coartem -malaria), Merck (Ivermectin – onchocerciasis), Bayer (Moxifloxacin – MTB) and others…<\/p>\n

\n

References:<\/strong><\/p>\n

[1]<\/a> R Laxminarayan.\u00a0 Antibiotic effectiveness: Balancing conservation against innovation.\u00a0 Science 2014, 345: 1299<\/p>\n

[2] Sept 2009 Conference on Innovative Incentives; 2009 LSE report, Mossialos: http:\/\/www.euro.who.int\/__data\/assets\/pdf_file\/0011\/120143\/E94241.pdf<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

The economics of developing antibacterials is a frustrating topic to address.\u00a0 There are unique aspects to the antibiotic market which sets it apart from other medicines, esp. the unique societal aspects of antibiotic use which go beyond the benefit to the individual. IDSA has spoken out in various publications (\u201cBad Continue reading It\u2019s Not a Free-Enterprise Market, Stupid!<\/span>→<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":936,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[227,18],"tags":[553,551,545,266,548,220,587,92,550,556,5,554,27,589,590,544,549,588,47,295,174,475,557,555,552,404,528],"class_list":["post-932","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-recent_literature","category-the_viewpoint","tag-10-x-20-initiative","tag-acute-vs-chronic","tag-antibiotic-marketing","tag-antibiotic-resistance","tag-antibiotic-value","tag-bayer","tag-coartem","tag-cubist","tag-curative-vs-chronic","tag-economic-incentives-for-industry","tag-fda","tag-ice-bucket-challenge","tag-idsa","tag-ivermectin","tag-malaria","tag-market-economy","tag-market-forces","tag-merck","tag-moxifloxacin","tag-mtb","tag-novartis","tag-onchocerciasis","tag-orphan-drug-pathway","tag-regulated-market","tag-societal-impact-of-antibiotics","tag-tuberculosis","tag-veterinary-use-of-antibiotics"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/allphasepharma.com\/dir\/wp-content\/uploads\/2014\/09\/freemarket-slider-copy.jpg?fit=640%2C200&ssl=1","jetpack_shortlink":"https:\/\/wp.me\/p4KWFr-f2","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":3577,"url":"https:\/\/allphasepharma.com\/dir\/2025\/06\/02\/3577\/__trashed-2__trashed\/","url_meta":{"origin":932,"position":0},"title":"The 10 x \u201920 Initiative – A Retrospective","author":"Harald","date":"June 2, 2025","format":false,"excerpt":"It started all so well with fanfare and great expectations.\u00a0Fifteen years ago, the 10 x \u201920 initiative got underway. Its goals were spelled out clearly: To \u2018Pursue a Global Commitment to Develop 10 New Antibacterial Drugs by 2020 \u2019[3].\u00a0 It was driven by ID clinicians and by antibiotic developers concerned\u2026","rel":"","context":"In "Did you know...?"","block_context":{"text":"Did you know...?","link":"https:\/\/allphasepharma.com\/dir\/category\/interesting_facts\/"},"img":{"alt_text":"BBND","src":"https:\/\/i0.wp.com\/allphasepharma.com\/dir\/wp-content\/uploads\/2020\/06\/BBND.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/allphasepharma.com\/dir\/wp-content\/uploads\/2020\/06\/BBND.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/allphasepharma.com\/dir\/wp-content\/uploads\/2020\/06\/BBND.jpg?resize=525%2C300&ssl=1 1.5x"},"classes":[]},{"id":4964,"url":"https:\/\/allphasepharma.com\/dir\/2025\/08\/15\/4964\/new-idsa-cuti-guideline\/","url_meta":{"origin":932,"position":1},"title":"NEW IDSA cUTI GUIDELINE","author":"Harald","date":"August 15, 2025","format":false,"excerpt":"A new Guideline for the treatment of cUTI just arrived.[1] First, we are glad that this somewhat mundane topic receives the attention it deserves.\u00a0 UTIs are often downplayed as minor infections, but the cUTI variety should not be taken lightly.\u00a0 Many patients still are admitted with life-threatening infections, so prompt\u2026","rel":"","context":"In "The News"","block_context":{"text":"The News","link":"https:\/\/allphasepharma.com\/dir\/category\/the_news\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/allphasepharma.com\/dir\/wp-content\/uploads\/2025\/08\/cUTI-classification.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/allphasepharma.com\/dir\/wp-content\/uploads\/2025\/08\/cUTI-classification.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/allphasepharma.com\/dir\/wp-content\/uploads\/2025\/08\/cUTI-classification.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/allphasepharma.com\/dir\/wp-content\/uploads\/2025\/08\/cUTI-classification.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/allphasepharma.com\/dir\/wp-content\/uploads\/2025\/08\/cUTI-classification.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":2289,"url":"https:\/\/allphasepharma.com\/dir\/2016\/02\/10\/2289\/the-10-x-20-goal-are-we-on-track\/","url_meta":{"origin":932,"position":2},"title":"The 10 x \u201920 Goal \u2013 Are We On Track?","author":"Harald","date":"February 10, 2016","format":false,"excerpt":"In the last decade (2000-2010), we saw the number of new antibiotic approvals drop successively each year; FDA changed the rules of the approval process without providing public guidance; many antibiotic companies fled the therapeutic area; investments were redirected to oncology projects which had a much better ROI. 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