Here's another idea for a resolution that ought to spur action on behalf of America's dozens of billionaires (I'm writing to you, Jeff Bezos, Bill Gates and Warren Buffet) : Start pumping billions into the antibiotics manufacturers who are rapidly going out of business. After all, a billionaire group in Tulsa is already pouring many millions into helping the city house the homeless, e.g.
"Hobo Cities" Growing - So Why Don't The Billionai…
So why not help out with this vastly more critical arena which could affect the lives of millions? And no, the antibiotic drug companies don't need assistance because they are lazy or can't get the proper drugs manufactured. But chiefly because making critical antibiotics is batting on a losing financial wicket. After all, any time you begin a regimen of the drugs (like amoxicillin) it's for a limited time only, and not for a chronic condition -say like diabetes. Hence, for antibiotic drug makers profit margins are too low to ensure survival over the long term.
Even as deadly strains of antibiotic resistant bacteria - from E. Coli. to MRSA- proliferate around the world, big drugmakers are getting out of the antibiotics market, leaving many new products in the hands of tiny startups. But most new antibiotics for dangerous strains are selling poorly because doctors hold them in reserve until they’re absolutely necessary, concerned about creating drug resistance. And price-sensitive hospitals have been slow to switch to the drugs from cheaper generics. This is in spite of superbugs killing more than 35,000 per year and sickening 2.8 million. Thus the commercial prospects for these drugs are at odds with their value to society.
Case in point: Four years ago, antibiotics developer Tetraphase Pharmaceuticals Inc. had a market value of almost $2 billion. Now its shares trade for about 70 cents as investors flee the market for new drugs that kill bacterial infection. In the words of Tetraphase Chief Operating Officer Larry Edwards:
“In my 20 years, I have never seen it any worse than this. Investors have shied away."
Edwards, a veteran antibiotics marketer, said it had become apparent that Tetraphase simply didn’t have the money to continue testing its other drugs while investing in the launch of Xerava. To survive, the company said last week it would cut research, reduce staff and try to divest three drugs it has in development. The reorganization and other cost-saving efforts will save about $8.2 million annually, the drugmaker said last week.
Meanwhile, the company plans to focus all of its efforts on marketing Xerava, a recently approved hospital drug that fights particularly tough abdominal infections. Edwards, quoted in a Bloomberg piece, observed:
“It has always been a challenging industry to be in. But now, everybody wants an immediate return.”
Another small firm specializing in antibiotics, Achaogen Inc., filed for bankruptcy protection in April, less than a year after getting approval for a drug- Zemdri,- for urinary tract infections. This is a drug so potent that it killed resistant strains in the test tube. In other words, it's a drug desperately needed as antibiotic resistant strains proliferate. But in June, the company, which once had a market value of about $1 billion, reached an agreement to sell most of its assets, including the "miracle" drug for just $16 million as part of a bankruptcy auction. (The drug was developed at cost of $300 million.) In the words of Kevin Outterson, a Boston University law professor who has studied market failures in the antibiotics area:
"The business model, the way we reimburse and pay for antibiotics, has just fundamentally crashed,”
These cases I've noted aren't exceptional. A number of antibiotics companies have less than a year of cash left, said Alan Carr, an analyst at Needham & Co. Skittish investors are unfairly lumping all antibiotics makers together, regardless of the quality of the drug or potential size of the market, which differ from company to company, he said.
These cases I've noted aren't exceptional. A number of antibiotics companies have less than a year of cash left, said Alan Carr, an analyst at Needham & Co. Skittish investors are unfairly lumping all antibiotics makers together, regardless of the quality of the drug or potential size of the market, which differ from company to company, he said.
Unless something changes, “it is entirely possible we may see more bankruptcies,” Carr said.
True, not all the fault is traced to impatient, greedy investors looking for rapid returns. Some small antibiotics makers simply misjudged the market's capacity by developing high-priced drugs narrowly focused on rare, resistant strains that make headlines. However, they ignored less costly drugs for the partly resistant strains that intensive-care doctors see on a regular basis. This according to Andrew Shorr, a pulmonary critical-care physician at MedStar Washington Hospital Center. As he pointed out:
“There is a misalignment between what the physician sees as his or her unmet need and what is being developed."
Shorr ought to know whereof he speaks, as he's consulted for Tetraphase, Achaogen and others. Because doctors often don’t know which strains a patient has when they begin treatment, they’re unlikely to turn first to an expensive new drug.
My take is we have two options to consider: 1) Allowing all the antibiotics makers to go to ground and terminate in bankruptcies or selloffs- which would be disastrous for patients who desperately need the drugs or 2) Encourage civic - minded billionaires to each chip in a few billion to keep them afloat. That is, prevent our already shaky healthcare system from losing one key support: the urgent need to provide antibiotics in the surgery, treatment (e.g. for ear infections, strep throat) and ER settings, without which many more tens of thousands will die, from c. diff., MRSA and other infections. And those will be mostly antibiotic resistant bugs for which are standard arsenal of drugs will be useless.
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