Why we need a new system for antibiotics

Antibiotics, a sub-group of all antimicrobials, are fundamental for modern medicine. Antimicrobial resistance (AMR) is characterised by bacteria developing resistance to existing antibiotics, reducing the ability of these antibiotics to treat infections. With increasing AMR there is an urgent need for novel antibiotics, but the current pipeline is underdeveloped, with few promising antibiotics in late-stage development (Wellcome Trust, 2020; Butler et al., 2022).

We have written previously on the causes of this underdevelopment. In brief, the persistent market failure is multifactorial, driven by limitations of sales in line with antimicrobial stewardship practices, and a lack of adequate value assessment methodologies to capture the full value of new antibiotics, amongst other challenges (Prasad et al., 2022; Leonard et al., 2023).

Policy solutions for this market failure have been proposed in various forms. Once such solution involves the use of pull incentives which present rewards for products following market entry (Dutescu and Hillier, 2021). For AMR, a ‘volume-delinked’ pull incentive has been proposed that would take the form of a subscription, allowing products to be compensated independent of the volume of sales (Rex and Outterson, 2016).

In the UK, the NICE-NHS England Antimicrobial Resistance (AMR) Pilot (NICE, 2023) tested the application of this type of pull incentive for two antibiotics, with the maximum subscription payment capped at £10M/year. The funding arrangements under the pilot commenced in July 2022 and will last for three years, with the option of extending up to 10 years (Leonard et al., 2023).

What is being proposed now?

From July to October 2023, NHS England held a public consultation on new UK-wide proposals for a more long-term follow-up scheme (NHS England, 2023). Under the scheme, an invitation to tender for novel antibiotics will be issued approximately once a year. All products receiving a marketing authorisation in the period since the previous tender will be able to apply, as will products with a high probability of receiving a marketing authorisation within 12 months.

In a first step, eligibility for the scheme will be assessed in an “administrative” procedure according to set criteria, including target pathogens and other conditions, such as surety of supply and the manufacturer demonstrating their commitment to specified social value requirement, e.g. achieving net zero emissions.

In a second step, eligible antimicrobials will be assessed in terms of value across 17 criteria that cover aspects of clinical effectiveness, global and national needs, pharmacological benefits, and health system benefits. Each criterion is associated with scores and a weight (Figure 1) that will aid the evaluation of total value. A proposed product can achieve a total value score between 0 and 100. Assuming a minimum score (50%) is achieved, the scoring system will be used to categorise the new antimicrobial into one of four bands. Each band corresponds to a payment value. For England, the values are: £5 million, £10 million, £15 million, or £20 million per year respectively.

Figure 1 Criteria and Weights (Adapted from NHS England, 2023)

Is the scoring system fit for purpose?

In collaboration with five experts (four clinical microbiologists and one hospital pharmacist), we created five dummy antibiotics to be assessed via the new scoring system. The products were based on the pipeline, with further details based on assumptions made or validated by the experts. A summary of the dummy products and their scores is given in Figure 2.

Figure 2 Summary of dummy product characteristics and results

Dummy 2 scored the highest, narrowly missing out on the top value band¹. Dummies 4 and 5 received the lowest scores, with Dummy 5 not qualifying for any value band.

Based on this analysis and the discussions with clinical experts, we propose four key takeaways:

1. Potentially realistic dummy products can be constructed from the pipeline that reach value bands 2-4.
2. The highest scoring dummy product (dummy 2) achieved a score of 79.2, just missing the top value band (minimum score 80). It is an innovative antibiotic, targeting gram-negative pathogens and resistance mechanisms, with both oral and IV formulation.
3. Not all products in the pipeline will achieve sufficient scores to quality for a value band. Less innovative antibiotics, which are most likely to reach market in the short to medium term, do not score well.
4. It will be particularly challenging for products to achieve a good score on criterion 1D, related to evidence of clinical effectiveness. This criterion requires RCT evidence in resistant populations to achieve any score greater than 50%. Given that such trials are almost impossible to conduct due to ethical, statistic, practical and commercial concerns, the demands of this criterion are not reasonable. The impact of this criterion is substantial due to weight it carries (11.3% of the total score).

Will the scheme be effective as a pull incentive?

Investors are a critical stakeholder in the development of new antibiotics, as their buy-in is critical to unlock the required funds and expertise for the development of novel antibiotics. We interviewed nine investors to gain insight into their perceptions of the proposals. Interviewees included:

1. Institutional financial investors (n=2): major collectors of savings and suppliers of funds to financial markets including investment funds, insurance companies and pension funds (OECD, 2020).
2. Mission-led investors (n=4): institutional investors with a clear societal goal or mission for investment decisions.
3. Biopharma executives and decision makers (n=3): Biopharma industry representatives that make decisions about R&D spending, pipeline or asset acquisition/licensing.

The key insights from the interviews were as follows:

• All investors agreed that the UK proposals are hugely significant. They are novel, the first of their kind, and will send signals to other countries regarding the importance of such a scheme and how it can be actioned.
• Pull incentives are considered to be a key mechanism for incentivising the development of novel antibiotics by mission-led investors and biopharma executives. Institutional investors are less likely to take public policy, including but not restricted to pull incentives, into account in investment decision making.
• Some elements of the eligibility criteria will be a barrier to participation, particularly for smaller companies, potentially undermining the pull incentive.
• The upper bands (£15m, £20m) are deemed sufficient to be effective as England’s proportion of a global pull incentive, but the lower bands (£5m, £10m) are not.
• The scheme as proposed is not sufficiently predictable to support investment. This is due to the existence of multiple value bands, a scoring system which is likely to change over time (therefore representing a moving target), uncertainty over contract length, and/or the potential for abolition of the scheme part way through development. Clearer signposting for investors over what they can expect to receive is required.
• While the UK effort in isolation will not represent an effective pull incentive, combined action from the EU and the USA would be expected to provide a sufficient minimum pull incentive.
• Substantial harmonisation across schemes (particularly in eligibility criteria) will be required for global sums to add up to a sufficient incentive.

How can the proposals be strengthened?

Based on these analyses, we suggest the following actions:

• Revisit criterion 1D, relaxing the demands for RCT evidence, partly for the mid-level scores (e.g. 50-70). This will prevent products that are considered to be of high value by experts from being penalised against overly demanding requirements.
• Ensure the criteria and levels take account of the evolving international landscape of resistance, rather than focusing on UK needs. This will future proof the system and allow for greater alignment with other international schemes, which is crucial for the success of the global pull incentive.
• Revise upwards the payment amounts, with the lowest payment band offering £15m per Annum. This will alleviate concerns that these lower bands are insufficient as well as apprehensions around the lack of predictability of the scoring system.
• Consider whether the initial contract length could be extended beyond 3 years. Investors would prefer a 10-year term but accepted that 5 years may be a reasonable compromise.
• Provide clarity and potentially higher flexibility in the application of eligibility criteria, particularly around financial standing, environmental and societal commitments for smaller companies.
• Implement a transparent collaborative process for the review of scoring criteria and contract conditions over time. Changes should be made gradually, with adequate warning to allow investors and innovators adapt. Major changes should be consulted upon with external stakeholders.
• Clarify the long-term commitment to the scheme. Investors require assurance that the scheme will still be in action at the time of market entry. As investments are made early in the development process, investors will require a long-term commitment to the scheme (or a similar replacement).
• Share best practices and encourage the development of streamlined and harmonised subscription systems internationally. The UK scheme will not be sufficient on its own.

We believe these suggestions will i) support the proposed UK scheme in achieving its aim of stimulating investment in novel antibiotics and ii) provide useful learnings for establishing effective pull incentives in other jurisdictions.

Notes

¹ Value band 2: ‘critical value’ is defined as 70-79, so technically this dummy surpasses value band 2, but does not reach value band 1 which requires a minimum score of 80.