Funding the future: Sustainable financing models to help the fight against antimicrobial resistance

The growing problem of antimicrobial resistance, or AMR, has been called a “silent pandemic”, a “slow-motion tsunami”, and one of the “top 10 global health threats to humanity in the 21st century”.

Antimicrobial resistance happens when bacteria, viruses, fungi and other microbes no longer respond to the medicines (antibiotics, antivirals, antifungals) used to treat them. It’s a natural process that occurs as the genetic make-up of pathogens changes over time, but it has been accelerated by the misuse and overuse of antimicrobials to treat humans, animals and plants.

More than 80% of global AMR deaths occur in developing nations and it leads to more deaths in the World Health Organization’s (WHO) Africa Region than anywhere else in the world.

By 2050, it’s thought AMR could kill as many as 10 million people, with the global costs estimated to reach $100 trillion, resulting in a 3.8% drop in global GDP, according to Investor Action on AMR (IAAMR).

AMR disproportionately impacts low-income countries, with more than 80% of global AMR deaths occurring in developing nations, according to a report from BCG, in collaboration with the World Economic Forum, Wellcome Trust and Novo Nordisk.

In September 2024, the United Nations convened an AMR High-Level Meeting - the second time such a meeting has taken place at the UN General Assembly (UNGA).

UN Member States adopted a political declaration committing to targets and actions to strengthen and accelerate multi-sectoral progress on addressing antimicrobial resistance (AMR).

They pledged to reduce AMR-associated global deaths by 10% by 2030 compared to the 2019 baseline of 4.95 million deaths.

They also committed to sustainable national financing and budgeting, as well as to $100 million in sustainable catalytic funding, to help at least 60% of countries achieve funded national action plans on AMR by 2030.

In the lead-up to first High-Level Meeting on AMR, in 2016, British economist Jim O’Neill reviewed AMR's global implications, recommending “incentives to develop new drugs, vaccines and diagnostics”.

But the Wellcome Trust, which commissioned the report alongside the UK government, says little progress has been made.

This remains a key component to tackling the AMR crisis and while there has been some innovation, there are challenges to overcome. Emerging financing models are set to play an important role.

Vaccines against 24 pathogens could reduce the number of antibiotics needed by 22% or 2.5 billion defined daily doses globally every year, according to a new report from the WHO.

While some of these vaccines are already available but underused, others would need to be developed and brought to the market as soon as possible.

Since 2017, only 13 new antibiotics have obtained marketing authorization, but only two represent a new chemical class and can be termed “innovative”. It typically takes between 10 and 15 years for new drugs to progress from candidate stage to clinical trials, but only two to three years for antibiotic resistance to develop.

In June 2024, the WHO’s report on antibacterial agents in clinical and preclinical development found there is a “pressing need for new, innovative agents for serious infections and to replace those becoming ineffective due to widespread use”.

There are multiple reasons for the dearth in the development of new antibiotics, but market failures play a big role, with few incentives existing for the pharmaceutical industry, low sales volumes and uncertain return on investment for investors.

The net present value (NPV) – expected profitability of a drug development project – for an antibiotic development project has been estimated at −$50 million compared to $1.15 billion for a musculoskeletal drug.

The ‘discovery void’ began when big pharma companies left the antibiotic market between 2000 and 2010, as they shifted focus towards more profitable drugs for cancer and lifestyle diseases.

Today, it’s primarily just academic institutes and small- and medium-sized enterprises (SMEs) that carry out research into new antibiotics – but they lack the funds and, increasingly, the expertise to take the compounds through clinical trials to market.

The political declaration from the High-Level Meeting at UNGA in September noted that currently “only 11% of countries have dedicated funding in their national budgets” for implementation of national action plans on antimicrobial resistance.

The need to “explore, encourage and promote a range of innovative incentives and financing mechanisms for multisectoral health research and development to address antimicrobial resistance” is highlighted, with public-private partnerships being central to these efforts.

In the past decade, multiple initiatives have been launched to incentivize the development of antibiotics, with the EU, US and UK leading on push funding efforts.

Although they have unlocked vital funding for R&D, as research shows, many of these initiatives focus on early-stage funding for academic and research institutes, while SMEs are just as in need of financing for clinical trial phases.

At a global level, organizations including CARB-X and the Global Antibiotic Research & Development Partnership (GARDP) are working to bridge the funding gap.

In June 2023, the European Observatory on Health Systems and Policies published a policy brief urging for “a holistic package of incentives” to reinvigorate the antibiotic pipeline.

It recognized the success of push incentives but called for the need to align these with pull incentives, such as financial rewards linked to R&D results, reimbursement reforms and regulatory changes, to “increase revenue and create viable markets for antibiotics”.

Addressing market factors, improving return on investment and supporting SMEs would help to align push and pull incentives, the brief noted.

There are various different pull funding models being used throughout Europe, from subscription payments and market entry rewards to transferable exclusivity extensions, and milestone payments, which guarantee grants at different stages.

In the UK, the government’s five-year action plan for antimicrobial resistance included a world-first pilot, which paid companies a fixed annual fee for antimicrobials based on an assessment of their value to the NHS.

Building on its success, NHS England is looking to establish an antimicrobial products subscription model to offer a contract with a fixed annual fee, delinked from the volume of the product used.

‘Delinkage’ is emerging as a promising model, according to ReAct – the network for Action on Antibiotic Resistance, which can “pay for Research & Development costs and remove the need to charge high prices or maximize sales volumes”.

Combining push and pull incentives in mix or hybrid financing models is widely considered the most effective way to accelerate the development and deployment of new antibiotics.

The political declaration on AMR closes with the need to convene another High-Level Meeting in 2029 to review the declaration’s implementation.

It also looks ahead to the 4th Ministerial Conference on AMR to be held in November 2024 in Saudi Arabia under the theme "From Declaration to Implementation - Accelerating Actions Through Multisectoral Partnerships for the Containment of AMR".

In 2029, it will be a century since Fleming’s discovery of penicillin, but without coordinated global effort, innovation and financing to end the AMR crisis now, all the progress he set in train could be undone by 2030.