Abstract
Background
The development pipeline for antibacterial drugs has not met the demand of hospitals and healthcare providers struggling to cope with increasing problems of antibacterial resistance. Although the challenges associated with antibacterial drug development have been known for some time, previous efforts to address them have not been sufficient. There remains an urgent need for targeted incentives to foster antibacterial drug development while encouraging prudent use.
Objective
We examine the effects of two types of incentives, a 5-year delay in competition from generics and a lump-sum US$50 million prize payment upon successful US Food and Drug Administration approval, on antibacterial drug company returns.
Methods
We use the decision-tree framework developed in a study for the US Department of Health and Human Services, which models the drug company’s decision process as a revenue maximizer under uncertainty.
Results
Our results show that, to maximize societal benefit, such incentives need to take into consideration the indication(s) the new antibacterial drug is designed to treat as well as the drug development stage.
Conclusions
Optimal policies should maximize the difference between societal benefit, primarily measured as the reduction in public health burden from the development of a new antibacterial drug that treats an infectious disease while ensuring prudent use, and social cost. Here, we show that the two types of policies examined under-incentivize early-stage developers (i.e., do not achieve the desired outcome) and over-incentivize late-stage developers (i.e., achieve the desired outcome but at a cost that is higher than needed) ceteris paribus.
Notes
The modeled incentive corresponds to Section 805 of the Generating Antibiotic Incentives Now Act, signed into law as part of the Food and Drug Administration Safety and Innovation Act, which extends the Hatch Waxman provisions related to data exclusivity by 5 years for a Qualified Infectious Disease Product [11].
On 18 September 2014, the White House issued a series of new actions designed to incentivize efforts to combat antibiotic-resistant bacteria. One of these actions included the launch of a US$20 million prize “… sponsored by the National Institutes of Health (NIH) and the Biomedical Advanced Research and Development Authority (BARDA) to facilitate the development of a rapid diagnostic test to be used by health care providers to identify highly resistant bacterial infections at the point of patient care” [12]. The choice of US$50 million for the case study presented in the paper was loosely based on this US$20 million amount. We assumed that for antibacterial drugs, a lump-sum prize that is 2.5 times that for a rapid diagnostic test might be more appropriate.
A supplementary protection certificate is a type of incentive used in the European Union as well as Iceland, Liechtenstein, and Norway, which extends the patent life for specific pharmaceutical and plant protection products when granted.
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Acknowledgments
The authors gratefully acknowledge Edward Cox (US Food and Drug Administration), Peter Lurie (US Food and Drug Administration), Michael Lanthier (US Food and Drug Administration), and Kevin Outterson (Boston University) for their insightful comments, advice, and guidance. The authors also would like to thank Anna Birkenbach (Eastern Research Group, Inc.), Nyssa Ackerley (Eastern Research Group, Inc.), and Calvin Franz (Eastern Research Group, Inc.) who provided invaluable research support. The views expressed in this paper are those of the authors and do not necessarily represent those of the US Food and Drug Administration, Office of the Assistant Secretary for Planning and Evaluation, the US Department of Health and Human Services, or Eastern Research Group, Inc.
Author Contributions
Aylin Sertkaya developed the decision-tree framework, conducted the quantitative analysis presented, and wrote the background and results sections of the paper. Hui-Hsing and Amber Jessup developed the original research question, identified the incentives to be examined, and wrote parts of the methods and discussion sections, respectively. Each author also served as a reviewer of other authors’ sections.
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Funding
The funding for this study was provided by the US Department of Health and Human Services Office of the Assistant Secretary for Planning and Evaluation and the US Food and Drug Administration under Contract No. HHSP23320095634WC Task Order No. HHSP23337004T.
Conflict of interest
Aylin Sertkaya, Amber Jessup, and Hui-Hsing Wong have no conflicts of interest to declare for this research.
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Sertkaya, A., Jessup, A. & Wong, HH. Promoting Antibacterial Drug Development: Select Policies and Challenges. Appl Health Econ Health Policy 15, 113–118 (2017). https://doi.org/10.1007/s40258-016-0279-5
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DOI: https://doi.org/10.1007/s40258-016-0279-5