UK Life Sciences and Healthcare Newsletter - December 2020: Antimicrobial Resistance (AMR) – A Personal Perspective

Dechert LLP

Dechert LLP

[guest author: Kevin Cox]*

“Our world faces a silent, slow-moving global threat that kills around 700,000 people each year due to the uncontrolled rise of superbugs resistant to antibiotics. These superbugs can affect anyone, of any age, in any country. AMR is a universal issue that impacts us all – we are all at risk.”

These are the headline words on the website of the AMR Action Fund, an organisation recently set up to accelerate the development of new antibiotics.

My interest in AMR originated a lot closer to home. Two years ago, a friend and colleague had been diagnosed with bowel cancer and was undergoing treatment, with apparent success. Unexpectedly and tragically he died. We discovered this was not due to his cancer but as a result of an inability to fight infection. He is now one of the 700,000.

So, what should you do? Mourn? Give to charity? Shake your head at the unnecessary loss of life?

We founded a company – Biotaspheric Limited, focused on accelerating the development of novel antibiotics specifically to address the ‘uncontrolled rise’ of AMR.

It is accepted that antimicrobial resistance results from multiple factors, including the misuse and overuse of antibiotics, the spread of infectious diseases through poverty, inadequate water supply and poor sanitation, and a lack of access to quality health care. As a result of resistance, bacteria are “feeding off the drugs intended to kill them and are evolving into superbugs”.

Developing new drugs to overcome AMR has been a disaster. No new classes of antibiotics have been discovered since the 1980’s. The antibiotics brought to market in the past three decades are generally variations of existing drugs with the same inherent potential to become obsolete due to AMR. It can take 10-15 years and over US$1 billion to develop a new antibiotic. Failure rates in antibiotic drug development are high, and the costs incurred in research and development are difficult to reconcile with the limited potential revenues as a result of the need to reduce usage.

Paradoxically, antibiotics helped to make the world’s largest pharmaceutical companies successful, and are one of society’s most important classes of drug. For almost two decades, the companies that once dominated antibiotic discovery and development have been quietly walking away. Antibiotic prices are low and their use is increasingly restricted, leading to poor economic returns. In general, pharmaceutical companies are unable to justify investment in these life-saving medicines when compared with more lucrative therapeutics areas. Most of the companies now working on antibiotics are small biotechnology firms, many of them facing cash shortages and struggling to survive.

In the past two years alone, four small innovative companies (Achaogen, Aradigm, Melinta Therapeutics and Tetraphase Pharmaceuticals) have gone bankrupt. Funding for early-stage development of novel antibiotics has become as scarce as COVID-era GP appointments. Given the unpredictable returns, VCs struggle to justify investment when compared to other opportunities in drug development.

Antibiotics have had a profound effect on global health and yet, despite this, the market doesn’t value them. The market is broken.

So, is this a good time to start a new company developing antibiotics? We have bet our future on the encouraging, but slow-moving, recognition of the looming crisis by governments and philanthropic funders.

Incentives for repairing the antibiotic market have been debated by government policymakers for several years. There are two approaches, referred to as ‘push’ and ‘pull’ incentives. Pushes, usually in the form of grants, help to accelerate new drug candidates through early-stage clinical trials with a view to securing later stage commercial funding. ‘Pulls’ aim to soften the financial uncertainty after approval, when companies need to sell their drug while abiding by antibiotic stewardship guidelines.

Encouragingly, a number of multi-national initiatives have been launched in recent years to help address the push options. Of particular note are the CARB-X and Novo Repair Impact funds which have been established to provide funding for early-stage development of novel antibiotic technologies, in particular addressing WHO designated priority pathogens. Since July 2016 CARB-X has invested US$252.7 million in 70 projects around the world and the Repair Impact fund has invested US$48 million in eight projects.

In January 2020 at the World Economic Forum (WEF) in Davos, a coalition of public and private sector organisations, launched the ‘Investor Year of Action’ to “galvanise global action on AMR”. This recognised that “the financial sector can positively change behaviour if it aligns with international standards and guidelines on AMR”. A new AMR Action Fund, launched on July 9, has also been created to enhance antibiotic pipelines. This ground-breaking collaboration is focused on urgent public health needs and aims to invest US$1 billion in funding from 20 leading pharmaceutical companies to bring two to four new antibiotics to patients by 2030.

Pull incentives are more fragmented and, in general, are at an early stage of consideration. These range from granting pharma companies extra time before other drugs they sell become generic, called extended market exclusivity, to giving companies market-entry rewards that eliminate the need to grow sales rapidly, which would otherwise accelerate the development of resistance.

In 2020, the UK became the first country to announce a payment strategy to incentivise companies to develop new antibiotics. The UK will pay companies via a subscription-style model for antibiotics based primarily on a health technology assessment of their overall value to the NHS, not simply on the volumes used. The NHS will have access to new drugs when needed and companies will have more certainty about their return on investment.

These ‘push’ and ‘pull’ incentives already are beginning to have an impact in encouraging small companies to re-enter the antibiotic field, but will take some time to turn the tide completely.

Another option, favoured by Biotaspheric, is to identify and develop technologies that address infectious diseases with a real unmet medical need and where AMR is reducing the treatment options. In support of this strategy, we have in-licenced a novel technology which blocks the natural waste-disposal systems of bacteria, so-called efflux pumps. These pumps reduce the concentration of drug in the organism, reducing its effectiveness and ultimately leading to resistance. Our initial target is the emergence of super-gonorrhea.

WHO has designated gonorrhea a priority disease for action as resistance to all existing treatments has been building in recent years. Furthermore, there are over 90 million new cases world-wide each year and prevalence is growing at 17% per annum. The market for gonorrhea treatments is about US$1.3 billion and presents an attractive opportunity for the introduction of new drugs.

Despite this being a potential commercial proposition, we are finding it extremely challenging to attract investors interested in supporting early-stage development of our technology. It would seem that traditional VCs bracket all antibiotic development into the category of not-commercially-viable and have been reluctant to engage. We are now expanding our efforts to identify innovative investors with more philanthropic credentials and who may also have had personal experience of AMR.

We will not give up – we need new antibiotics and the memory of my friend, a cancer patient who died from infection, remains a driving force.

Finally, no self-respecting article in healthcare can avoid the mention of COVID-19 – and, in this case, its potential impact on AMR.

The threat of infectious disease and the need for healthcare systems to be prepared for all eventualities must surely raise the profile of the AMR crisis and increase the urgency of establishing push and pull incentives. Time will tell.

Much remains unknown about how the pandemic is directly impacting overall levels of AMR, but a review of data from COVID-19 cases, mostly in Asia, found that more than 70% of patients received antimicrobial treatment despite less than 10% having bacterial or fungal co-infections. This expansion of antibiotic use (and the occasional intervention from high profile politicians), along with increased exposure to healthcare settings and invasive procedures, has amplified the opportunity for AMR to emerge and spread, further exacerbating an existing crisis.

In time, it is to be expected that victims of AMR will far outstrip deaths from COVID-19, and yet it remains a “silent, slow-moving global threat”. We are running out of time.



*Executive Chairman, Biotaspheric Limited.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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