It’s Time to Fix the Antibiotic Pricing Problem
As news breaks of another antibiotics company scrambling to survive, forcing the exit of the CEO and a reorganization that eliminates its research capabilities, experts in the field warn of a looming collapse of the antimicrobial resistance research field.
It’s time to stop messing around, wringing our hands and fix the problem with the business model for antibiotics. It is simply not possible to conduct pricing & reimbursement for important new antibiotics using the same methods we use for other medicines, using pricing methods used for over 100 years.
Because of the imperative for antimicrobial stewardship, we want to minimise the volume use of any new powerful antibiotics to reserve them for cases which cannot be treated by other means, so we extend the time these antibiotics are useful for. Therefore, we cannot price them based on volume use.
For innovative antibiotics we need to move to a ‘licence-to-use’ fee model – where healthcare systems/provider units pay an annual licence fee to the originator company to have access to use the new antibiotic – where or not they use it, and no matter how much they use it. The licence fee is sufficient to pay a good return on investment to encourage further R&D into novel antibiotics/antimicrobials. It provides certainty of budget impact to the healthcare system/provider. Because it does not involve ‘procurement’ of medicines (the payment is for a licence, not a product) it could potentially avoid the Medicaid Best price trap.
The fee would be calculated based on the required return to stimulate future R&D, in consultation with all key stakeholders.
The use of a ‘licence-to-use’ fee is common in the software sector, and used routinely in consumer use of music and video streaming – so the principle is well established.
It also means that the healthcare system/provider unit would never ‘own’ the physical product – this remains the property of the originator company up until the time the medicine is administered to the patient.
Antimicrobial stewardship is maintained as the provider unit would need to demonstrate adherence to the defined and agreed protocol for the antibiotic use in each patient case.
If we are to successfully introduce ‘Star Wars’ antimicrobial medicines into a ‘Flintstones’ healthcare system, it’s time to put this into effect.
Independent Global Market Access Consultant, Trainer and Writer
5 年Thanks for a really thought-provoking article on an important subject, Colin. You make a strong case for adopting the “licence-to-use” model. Several other innovative solutions to antimicrobial funding have been proposed. Politicians in both the United States and Europe have suggested offering substantial market entry rewards for breakthrough antibiotics. Another option mooted by politicians on both sides of the Atlantic is transferable exclusivity—allowing a manufacturer to extend its patent on a different drug. We are also seeing public-sector funding of R&D on new antibiotics: CARB-X, for example—backed by US, German and UK agencies, the Bill and Melinda Gates Foundation, and the Wellcome Trust—is helping six companies to develop new drugs.
Product manager at Metromed - a Mazrui Group company
5 年I had read that this kind of contract "license-to-use" "arrived in some states in the US, as part of the treatment of hepatitis C.