Nearly a century after penicillin was discovered, doctors are now finding that that many infections have become resistant to antibiotics. As Jess Craig explains, “This phenomenon where bacteria evolve to survive antibiotics is called antibiotic resistance, or antimicrobial resistance more broadly because viruses and fungi can also evolve to survive antivirals or antifungals.
Common infections are becoming harder or even impossible to treat, and lifesaving medical procedures from surgery and cesarean sections to chemotherapy are becoming much riskier.
The World Health Organization (WHO) has identified antimicrobial resistance as one of the century’s top global health threats. Already some 2.8 million Americans contract drug-resistant infections each year resulting in 35,000 deaths, according to the Centers for Disease Control and Prevention (CDC). Globally, the death toll is estimated to be just over 1 million.”
To some extent it was to be expected that infections will evolve and become drug resistant as a natural consequence of evolution. However, it seems that human beings have done a bunch of things which has accelerated the speed at which bacteria becomes drug resistant: “Antimicrobials are used not only to treat infections in humans but also to prevent infections in farm animals or sometimes just to rapidly fatten them up. In developing countries or places facing humanitarian crises, infections are more common because of a lack of access to clean water and proper sanitation infrastructure. In some places with poor regulation around pollution, waste from health facilities or pharmaceutical manufacturing is simply dumped into nearby waterways, creating a perfect environment for pathogens to evolve resistance.”
Given this backdrop, you would assume that pharma companies are working hard to develop new drugs which do not have antimicrobial resistance. Unfortunately, that’s not the case: “Since 2017, the US Food and Drug Administration and the European equivalent have approved only 12 new antibiotics, but 10 of those were similar to existing drugs to which pathogens have already developed resistance.”
It is no longer profitable for pharma companies to come up with new antibiotics because the patients only have these drugs for a couple of weeks and because politicians do not allow the pharma companies to charge thousands of dollars for the new drugs.
So what can be done to incentivize the pharma companies to get on with it and discover new drugs? Answer: legislation. “Congress is now mulling renewed legislation to revive the antibiotic research and development field. The bill — called the Pioneering Antimicrobial Subscriptions to End Upsurging Resistance Act, or PASTEUR, a nod to the famous chemist and microbiologist Louis Pasteur – is widely supported by politicians on both sides of the aisle and by many public health organizations…
Essentially, the Pasteur Act would allow the US government to enter into subscription-style arrangements with companies manufacturing antibiotics. Once an antibiotic receives FDA approval, the US government would pay the pharmaceutical company anywhere from $750 million to $3 billion over five years to keep manufacturing the antibiotic, said Erin Duffy, the chief of research and development at CARB-X, a nonprofit dedicated to accelerating antimicrobial development. The US government would then provide that antibiotic to federal health insurance beneficiaries — such as veterans or seniors on Medicare — free of charge.”
Whilst the Pasteur Act will help Americans get access to new drugs at affordable prices, most of the rest of the world will still have to wait for these drugs to go off patent so as to get these drugs at affordable prices: “…while Americans with federal health insurance plans are guaranteed access to antimicrobials that receive support from the act, the proposed legislation does not provide any stipulations or guidance for ensuring global access to these drugs. Pharmaceutical companies are left to make decisions regarding pricing, manufacturing, and distribution of whatever antibiotics might be funded by the program,”
If you want to read our other published material, please visit https://marcellus.in/blog/
Note: The above material is neither investment research, nor financial advice. Marcellus does not seek payment for or business from this publication in any shape or form. The information provided is intended for educational purposes only. Marcellus Investment Managers is regulated by the Securities and Exchange Board of India (SEBI) and is also an FME (Non-Retail) with the International Financial Services Centres Authority (IFSCA) as a provider of Portfolio Management Services. Additionally, Marcellus is also registered with US Securities and Exchange Commission (“US SEC”) as an Investment Advisor.