Antibiotics "a terrible business model" for Pharmas expert tells Davos

By Gareth Macdonald

- Last updated on GMT

Davos hosts the World Economic Forum this week
Davos hosts the World Economic Forum this week

Related tags Bacteria Pharmacology Antibiotic resistance

Drug industry execs at the World Economic Forum in Davos, Switzerland were told they are no longer best placed to develop antibiotics by a panel who said Governments should lead efforts to create these vital new drugs.

Nobel Prize-winning chemist Venki Ramakrishnan made the comments during a discussion​ of usage restrictions placed on new antibiotics to delay resistance development, which he described as a “terrible business model.”

It’s the reason why many large pharma companies have really gone away from the development of antibiotics,” ​he said, adding that “it’s not like the 50s and early 60s where a lot of companies are developing antibiotics.

Ramakrishnan also cited the smaller patient populations that use antibiotics and the fact patients only take such them for a short time as other factors that make the economics of developing such drugs unattractive to the drug industry.

Government-backed R&D

This idea fits with the conclusions of a recent World Health Organisation (WHO) report​ and comments by the UK Royal Pharmaceutical Society (RPS) last July, as does Ramakrishnan’s suggestion a return to greater Government involvement would be a better approach.

If you go back to how antibiotics were developed…I believe penicillin was developed in the late 20s, but it wasn’t until the 40s when penicillin was actually produced in sufficient quantities to be put into clinical use. And that took an enormous Government effort.​”

He explained that the penicillin development effort was spearheaded by the UK Government and academics at Oxford University and – later – partnerships were formed with US drug companies when production needed to be scaled-up.

I think the way to develop new antibiotics has got to involve both Governments and non-profits working to do the ground work, before commercialising it​” he continued, adding that “we cannot rely on pharmaceutical companies alone to develop antibiotics precisely because of the business model​.”

Non-profit view

We put this idea to Professor Colin Garner, CEO of UK charity Antibiotics Research, who agreed with the suggestion that non-profit organisations like his have a role to play in the development of new products.

He told that: “There is a role that charities such as Antibiotic Research UK can play…we can take novel approaches that would not be taken by pharma. A charity's driver is to help patients and therefore making an ROI is not of paramount importance​.”

Garner also suggested antibiotics are bad business for pharma, at least in terms of how the need to sell products balances with the need to limit use.

The drug industry requires their products to be used as much as possible since this then equates to sales, return on investment and supporting the share price. It does not matter whether we are talking about drugs to treat cancer or to treat bacterial infections. The result is that antibiotics are overused​.”

He was less convinced that drugmakers should only be involved at the manufacturing scale-up stage, telling us that: “The problem of antibiotic resistance can be tackled by pharma provided a new incentive structure is put in place. This is one of the briefs of the O'Neill Commission set up by David Cameron to come up with novel approaches to incentivise pharma​.” 

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