August 01, 2012
In a cover story for this quarter’s issue of the Milken Institute Review, CDDEP director Ramanan Laxminarayan examines the many market failures and misaligned economic incentives that contribute to the growing threat of antibiotic resistance. The article also proposes measures to correct these systemic imbalances, on both the drug development and conservation sides of the issue.
With Extending the Cure coming to a close later this year, it is important to consider what solutions need to be set into motion to safeguard against a post-antibiotic future.
Laxminarayan’s discussion of drug conservation incentives in the article notes that unchecked antibiotic overuse, including many instances of inappropriate use (e.g., doctors prescribing an antibiotic for a viral infection on which it will have no effect), is a primary driver of bacterial resistance.
Compounding the problem is the tendency of hospitals to substitute antibiotics for the use of proper infection control practices, simply because these drugs are the cheaper alternative when it comes to preventing infections. There are two potential solutions to correct this market failure, Laxminarayan writes: subsidies for hospital infection control or taxes on hospitals tied to the incidence of infections. Strengthening policies that limit unnecessary antibiotic use in agriculture will also be crucial to slowing resistance rates, as current measures rely on self-enforcement on part of the industry.
The article advances several arguments for incentivizing the development of new antibiotics while concurrently rewarding companies for not overselling these drugs: First, the pharmaceutical industry has ceased to produce new antibiotics at an appropriate pace to assure replacement of compounds that have lost their effectiveness. More importantly, the industry has failed to develop novel classes of antimicrobials that can be used to treat life-threatening diseases as opposed to self-resolving ones. These facts, Laxminarayan asserts, along with the objective conflict between maximizing drug sales and minimizing resistance, are sound justifications for public intervention. Further complications include the tendency of bacteria to develop cross-resistance to new and old antibiotics, doctors underuse of newer drugs due to their higher cost, and a perceived lack of profitability in producing new antimicrobials among pharmaceutical companies, which see higher returns in long-term drugs for chronic diseases.
While a step in the right direction, the Generating Antibiotic Incentives Now (GAIN) Act is only one part of the multipronged approach needed to combat the threat of increasing resistance. As the article concludes, much deeper interventions are necessary to motivate all actors to work to conserve the effectiveness of current and future antibiotics, rather than simply priming the pump to generate new therapeutic compounds.
Read more in the Milken Institute Review.
