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The GAIN Act creates a process for the Qualified Infectious Disease Product (QIDP) designation, which provides a range of incentives for developing antimicrobial therapies for combating resistant organisms. But while the program has been successful in driving innovation, commercial viability remains a question.
The last decade has seen a rapid rise in resistant microbes along with a corresponding increase in public concern about antibiotic resistance. It is clear there is cause for concern: according to a 2013 CDC report, there are more than 2 million antibiotic resistant infections each year resulting in the deaths of over 23,000 patients. To combat this, the Generating Antibiotic Incentives Now (GAIN) Act was signed into law by President Obama in mid-2012. The GAIN Act creates a process for the Qualified Infectious Disease Product (QIDP) designation. QIDP designation provides a range of incentives for developing antimicrobial therapies for combating resistant organisms, including extension of the exclusivity period and priority review for newly developed antibiotics and antifungals.
While the program has been successful in driving innovation with nine products approved and dozens of products in development with QIDP designation since its implementation, commercial viability remains a question. For example, of all the products developed and marketed under this program we have not identified a product generating more than $60 million in annual revenue. This is likely a disappointing result for the pharma companies that developed these assets and a poor return on their investment. The resurgence of antimicrobial development may be short-lived if such products do not find commercial success. Before outlining certain policy changes for consideration which may better align commercial incentives with the public health urgency of antimicrobial resistance, we would first like to discuss the unique commercial challenges which may limit products in this space.
While it is not uncommon for healthcare companies to face challenges integrating their assets into existing treatment algorithms, this dynamic is exacerbated in the antimicrobial space in three key ways:
As a result of these dynamics, a new antibiotic may be restricted to very few patients, may only be used in patients where the probability of success is limited, and may not be immediately available to the few patients who definitively need it.
Within this complex system, our team has identified several potential policy changes that may provide additional commercial incentives for new antibiotics, without compromising antimicrobial stewardship objectives.
The GAIN Act provided an array of benefits which have effectively spurred development, however it did not sufficiently address the commercial risks borne by manufacturers. The limited sales for the first QIDP-designated antibiotics suggest that regulatory and exclusivity advantages are not enough. Without further policies that reward innovators, there is a real risk that development programs for many promising assets are terminated due to lack of commercial viability.
Robert Dumitrescu is a Partner in Simon-Kucher & Partners’ Paris office. Mithila Rajagopal is a consultant in the Boston office. Eric Bachman and Sarah Scalia are former associates at Simon-Kucher & Partners.