Despite the availability of 106 unique direct-acting antibacterial therapeutic entities on the market in the US (and 28 unique antibacterials outside the US), there remains a need for alternatives in light of bacterial resistance to current medicines. More than 82% of all antibiotic approvals occurred prior to the year 2000: meaning the majority of the drugs on the market are facing eventual loss in efficacy due to resistance developed by bacterial strains encountering these treatments in the population.
But the market and development landscape for antibacterials is vastly different to other drugs, and development currently relies heavily on small companies – which struggle to attract the funding required to progress candidates. With average sales revenue for antibiotics well below the threshold for remaining commercially viable (due to both price and volume), and yet with similar drug development costs to other disease areas, the incentive to invest for comparable ROI – and in some cases any ROI – is missing.
Experts from BIO put the spotlight on what is needed to ensure an effective new generation of antibacterials.
State of innovation
More than 1.2 million people worldwide are dying each year from antibiotic resistant infections and it is estimated this number will grow to 10 million per year by 2050. In the US alone, more than 2.8 million antibiotic-resistant infections occur each year, with more than 35,000 people dying as a result, according to the CDC.
Millions of currently treatable infections could become life threatening as the prior advantage over bacteria wanes in the coming decades.
The total clinical pipeline for new antibacterial therapeutics consists of 64 unique new antibacterial therapeutics, with 31 (48%) having novel targets, according to BIO's report. The number of drug programs (drug-indication pathways) for these 64 therapies is 72. Only eight drugs have a secondary indication pathway program and none of the therapeutic entities have more than two.
There are 47 small molecule NCEs (73%) and 17 biologics (27%) in the clinical pipeline. Traditional systemic small molecule “antibiotics” account for 97% (45 of 47) and topical small molecules account for 3% (2 of 47) of the small molecule pipeline NCEs. Of the 17 biologics, there are 7 systemic biologics (injectables for proteins or bacteriophage) and 10 live bacterial products that are orally delivered to the gut. There are three times as many small molecules for approved targets than for novel targets, whereas all 17 biologics are for novel targets.
However, the breadth and novelty of the antibacterial clinical-stage pipeline is insufficient to meet the ongoing threat of wide-spread infection from drug-resistant strains, notes the BIO report.
"The clinical pipeline contains 54 direct-acting novel chemical or biochemical entities and 10 microbial entities. However, of the non-microbial candidates, 61% have targets for which marketed drugs already exist. More than 38% of candidate programs are indicated for C. difficile and TB, leaving only 44 drugs for other pathogenic bacteria. Only 10 of these 44 candidates have a novel target."
The number of new antibiotic therapies originating from small companies accounts for around 80% of the drug discoveries, 8% from non-profit institutes and universities, and only 12% from large companies. This landscape reflects one of the biggest challenges for antibacterials: the struggle small companies face to receive funding.
“For the next generation of antibacterials... there needs to be a well-funded and appropriately rewarded biotech ecosystem for translational science to reach the clinic and beyond," says the report. "The majority of antibacterial innovation stems from small, emerging biotechnology companies. However, funding has been sparse for these antibacterial developers, and the ecosystem is fragile and failing.”
Over the last decade, antibacterial start-ups raised a total of just $2.3bn in both venture capital and IPOs. In contrast, oncology companies raised $38bn in venture capital and IPOs over the same period. This simply isn't enough to support the need for a broad ecosystem and diverse pipeline of candidates, says the report.
“There are three main factors that have scared off investors from antibacterial development. First, large companies have been exiting from the space for some time, with very few listed as co-sponsors of small company pipeline candidates. Without a vested interest from large biopharmaceutical companies, licensing deals and M&A dry up, souring the incentive for early-stage investors such as venture capitalists.
“Second, the majority of recent examples of “successful” biotechs (those that have raised venture capital, obtained funding through public offerings, obtained FDA support via QIDP, and achieved FDA marketing approval) have been commercial failures. Investors point to these recent stories of antibacterial company bankruptcies and acquisitions at fire sale valuations as evidence to avoid investment in this segment of medicine.
“The third factor is the lack of effective policy and regulatory solutions to address the unique characteristics of the antimicrobial marketplace. The primary issue forcing big pharma out of the antibacterial sector and leaving small company innovators empty handed is that the traditional market dynamics do not exist for antimicrobials, and this has not been resolved through new policies."
For example, new antimicrobials will primarily be used as a last resort in hospitals when existing options prove to be ineffective, thus resulting in slow uptake (and by their nature, they should be used sparingly to preserve effectiveness). Meanwhile, novel antimicrobials are generally undervalued by reimbursement systems, and hospital-bundled payment reimbursement mechanisms can discourage the use of novel antibacterials.
"Taken together, these challenges create a market with little to no return on investment for antibacterial medicines."
Creating a healthy environment for innovation
So what’s the solution?
Conversations about policy solutions span the entire pathway of drug development and access with BIO outlining four key areas: early-stage investment (push mechanisms for research), late-stage investment (push mechanisms for development), clear and efficient regulatory pathways (regulatory incentives for development), and the post-approval market incentives (pull mechanisms).
Early-stage investment (push mechanisms for research). “The early funding of new target discovery at the lab bench must be consistent and sizable. This starts with government funding and grants (e.g., NIAID, BARDA, CARB-X etc.), and philanthropic foundations and institutes. However, the early-stage funding that needs to quickly follow these efforts must support new drug candidate discovery by funding chemists and biochemists to make the drug entities themselves. This is the phase where angel investors, entrepreneurs, and venture capitalists have traditionally converged to enable successful drug discovery.
“However for antibacterials, as noted, these traditional sources of funding are not supplying the investment needed. To solve this deficiency in the ecosystem, in recent years other creative hybrid models for funding have been launched, leading to promising NCEs. For example, a global non-profit partnership, CARB-X, recently completed five years of funding to support early development of innovative products, totaling over $360m across 92 projects in 12 countries. However, as candidates emerge from this discovery stage, they will go nowhere unless the following three solutions are in place.”
Late-stage investment (push mechanisms for development). “Small companies that may emerge with a candidate from early-stage research often struggle to obtain funding for the complex and costly Phase II and III trails. Multi-entity funds, such as the recent AMR Action Fund, can serve to fill this gap. Other public private partnerships, such as BARDA’s Project BioShield program or BARDA’s Broad Spectrum Antimicrobials program can also provide support to accelerate later stage research and development. The TB Alliance is a successful example of non-profit funding of clinical-stage development, with seven products currently in trials.”
Regulatory incentives for development. “In the last decade, multiple regulatory measures have been taken to change the efficiency and incentives for drug developers. For example, the Generating Antibiotic Incentives Now (GAIN) Act of 2012 brought forward the Qualified Infectious Disease Product (QIDP) designation to pipeline candidates. The QIDP designation provides eligibility for priority FDA review, fast-track designation, and an additional five years of market exclusivity. There have been 17 NCE approvals with QIDP.
"In 2016, the Limited Population Pathway for Antibacterial and Antifungal Drugs (LPAD) was introduced in the U.S. as part of the 21st Century Cures Act. Amikacin and Pretonamid were the first two drugs approved under this pathway in 2018 and 2019, respectively.
“In 2017, the U.S. Center for Drug Evaluation and Research (CDER) issued updated FDA guidance on clinical trial design for antibacterials. All of these regulatory steps acknowledge the hurdles industry is facing in the antimicrobial arena and take steps to streamline development. However, for drug developers, technical issues with trial enrollment and running large, complex comparative effectiveness studies remain as late-stage obstacles.”
Market-based mechanisms – Pull incentives and Reimbursement Reform. “Policy reforms that are not in place at the moment – and are most critically needed – are solutions to address the most disabling pillar of the ecosystem: the marketplace.
“With average sales revenue for antibiotics well below the threshold for remaining commercially viable (due to both price and volume), and with similar drug development costs to other disease areas, the incentive to invest for comparable ROI – and in some cases any ROI – is missing. Unlike other areas of drug development with potential benefits commensurate with risk taken and value delivered to patients, the private sector pathway for antibacterials does not work. Unlike the obstacles seen with chronic diseases, such as the inability to stratify patient populations, lack of understanding of the pathophysiology, and the challenging and costly regulatory requirements and difficult reimbursement environment, the antibiotic developers are facing a more nuanced market issue – the market for these types of novel antibiotic products does not exist in the traditional pharmaceutical form.
“To address the unique market challenges for antibacterials, a combination of two complementary postapproval incentives is necessary: a pull incentive to ensure sustainable investment into the AMR product pipeline, and reimbursement reform to stabilize the commercial marketplace and improve patient access.”