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Pharma Companies Form $1B Antibiotics Fund

Klebsiella pneumoniae

Klebsiella pneumoniae bacteria, among the microbes becoming resistant to antibiotics (CDC.gov)

9 July 2020. A group of 23 pharmaceutical companies are creating an investment fund to finance research and development of new drugs to combat antibiotic resistance. The AMR Action Fund — AMR stands for antimicrobial resistance — says it so far collected commitments approaching $1 billion to finance development of two to four new antibiotics by the year 2030.

Antimicrobial resistance occurs when bacteria or fungi mutate making current antibiotics ineffective in controlling their spread, leaving patients with fewer options in treating infections. The problem is compounded by overuse of antibiotics by humans or with animals, creating more opportunities for microbes to mutate and become resistant to current antibiotics.

As a result, a growing list of infectious diseases — including pneumonia, tuberculosis, blood poisoning, gonorrhea, and food-borne diseases — are becoming more difficult to treat. The AMR Action Fund cites data showing some 700,000 people worldwide die each year from antibiotic-resistant bacteria, with that number expected to rise to 10 million by 2050.

Compounding the problem further are the disappearing business incentives for companies to develop new antibiotics. In a December 2019 commentary, Science & Enterprise cites a New York Times story about antibiotic drug makers going bankrupt even as some products show promise against drug-resistant bacteria. And even with government contracting for these new antibiotics, venture investors remain reluctant to bankroll developers of these new drugs, preferring bigger payoffs from treatments for chronic disorders like cancer and heart disease.

AMR Action Fund aims to create more incentives for the industry to develop new antibiotics. The fund plans to step in for venture capital investors by investing in small biotechnology companies developing new antibiotics, as well as provide technical expertise as needed from participating companies. In addition, AMR Action Fund expects to enlist support from foundations, development banks, and multilateral organizations to encourage governments to create better market conditions for new antibiotics.

The 23 participating companies in the AMR Action Fund so far are members of the International Federation of Pharmaceutical Manufacturers & Associations, or IFPMA, the group organizing the initiative. IFPMA, based in Geneva, Switzerland, says participating companies committed some $1 billion to the fund. The fund plans to begin operating in the fourth quarter of 2020.

“With the AMR Action Fund,” says David Ricks, CEO of Eli Lilly and Company and president of IFPMA in an organization statement, “the pharmaceutical industry is investing nearly $1 billion to sustain an antibiotic pipeline that is on the verge of collapse, a potentially devastating situation that could affect millions of people around the world.”

Ricks adds, “The AMR Action Fund will support innovative antibiotic candidates through the most challenging later stages of drug development, ultimately providing governments time to make the necessary policy reforms to enable a sustainable antibiotic pipeline.”

Companies taking part in the AMR Action fund so far are Almirall, Amgen, Bayer, Boehringer Ingelheim, Chugai, Daiichi Sankyo, Eisai, Eli Lilly and Company, GlaxoSmithKline, Johnson & Johnson, LEO Pharma, Lundbeck, Menarini, Merck, MSD, Novartis, Novo Nordisk, Pfizer, Roche, Shionogi, Takeda, Teva, and UCB, as well as the Novo Nordisk Foundation.

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Disclosure: The author owns shares in Johnson & Johnson and Pfizer.

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