New York, USA- Efforts to advance antibiotics to combat rapidly evolving superbugs are mired in a failing business model.
Since 2017, six startups have received approval from the U.S. Food and Drug Administration (FDA) for new antibiotics. All of these companies have filed for bankruptcy, been acquired, or are about to close. About 80% of the 300 scientists working at the companies have given up on antibiotic development, said Kevin Outterson, executive director of CARB-X. CARB-X is a U.S. government-funded organization that promotes research in this area.
“These are companies that should be the winners, but every company’s story is unsatisfactory,” Otterson said.
The companies say the reason: They can’t sell life-saving products because of the systems that make drugs to treat cancer and Alzheimer’s disease – which depend on the companies selling enough new treatments or charging high enough prices to reward investors and make a profit. – Not suitable for use with antibiotics.
New antibiotics are designed to be used rarely and briefly to defeat the most harmful infections so bacteria don’t become resistant to them too quickly. Companies are pricing them 100 times more expensive than the generic drugs that doctors have been prescribing for decades for a few dollars per dose. Most sell very little.
“Antibiotics are like fire extinguishers. You do want these drugs to be available, but you generally don’t want to use them. That’s the paradox,” said infectious disease expert John H. Rex.
Nabriva Therapeutics laid off its remaining 60 employees this year and is looking for a buyer, four years after the FDA approved its pneumonia antibiotic Xenleta. Nabriva’s five-day Xenleta treatment costs more than $1,000. Common antibiotics used to treat patients with pneumonia outside the hospital typically cost less than $100. Fewer than 100 of the 800 hospitals targeted by Nabriva have purchased it.
“Everything is cost-driven,” said former Nabriva CEO Ted Schroeder.
New antibiotics should get similar support as treatments for rare diseases, said co-founder Ryan Cirz of Achaogen, which filed for bankruptcy in 2019, less than a year after the FDA approved its drug Zemdri to treat complicated ear infections and urinary tract infections.
The Orphan Drug Act of 1983 provides subsidies, tax breaks and additional periods of market exclusivity to drugmakers developing treatments for diseases that affect fewer than 200,000 people in the United States. Drugs to treat rare diseases often cost more than $100,000 per year. Sarepta Therapeutics charges $3.2 million for Elevidys, a one-time treatment for muscular dystrophy.
“People accept it. It’s all psychological,” said Siltz, who now runs Revagenix, another antibiotic startup. “We’ve been used to very cheap antibiotics for a long time.”
About 13,000 people in the United States develop severe drug-resistant infections each year, for which Achaogen’s drug Zemdri was developed. Up to half of patients hospitalized with such infections die. They are among more than 35,000 people in the United States who die each year from drug-resistant bacterial or fungal infections, a number that has increased in recent years.
The year Zemdri was approved, Achaogen spent nearly $200 million on manufacturing, marketing and other costs and generated $800,000 in drug sales. From its approval in June 2018 to the end of the first quarter of 2019, Achaogen’s stock price fell by more than 96%.
In 2019, the UK began adopting a subscription model, paying drugmakers based on the potential value of new antibiotics to public health. U.S. lawmakers have already considered similar legislation. In April, the House and Senate reintroduced bipartisan bills pledging to spend $6 billion on new antibiotics to treat drug-resistant infections. No votes have been taken on this yet.
“It may look like we’re trying to save companies, but really what we’re talking about is trying to fix the antibiotic production process itself,” said David Hyun, director of the Antimicrobial Resistance Project at The Pew Charitable Trusts.
Most big pharmaceutical companies are not developing antibiotics. Some companies have closed or sold their antibiotic development programs. “There’s no profitability,” Hyun said.
Entasis Therapeutics is an antibiotic developer spun out of AstraZeneca and acquired by holding company Innoviva in 2022. Most of the scientists working at Entasis are no longer involved in antibiotic development.
“The loss of institutional knowledge and experience is the biggest loss in the field,” said Alita Miller, former biology director at Entasis. “You can’t start over with someone who just finished graduate school.”
After the FDA approved Paratek Pharmaceuticals’ antibiotic Nuzyra, the startup spent $130 million and had sales of $11.5 million in 2019. Paratek was sold this month to investment firm Novo Holdings and private equity firm Gurnet Point Capital.
“I don’t think the market was fully aware of these challenges 10 years ago, but reality has hit us,” said Adam Woodrow, Paratek’s chief commercial officer.
Original version of “The Wall Street Journal”