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Economics of Antibiotic Resistance Ramanan Laxminarayan Latsis Symposium, 2015

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Page 1: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Economics of Antibiotic Resistance

Ramanan Laxminarayan

Latsis Symposium, 2015

Page 2: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

I. Increasing incomes and access to antibiotics are saving lives but are not a good substitute for public health

Page 3: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Bacterial diseases are still major killers in developing countries because of lack

of access to antibiotics

O’Brien et al, Lancet 2009

Page 4: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

What are we asking of antibiotics?

Page 5: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Substitute for immunization, infection control and water/

sanitation

South Asia

Page 6: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Substitute for immunization, infection control and water/

sanitation

Sub-Saharan Africa

Page 7: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Kyaw MH et al. N Engl J Med 2006;354:1455-1463.

Vaccines can be effective Invasive disease caused by Pneumococci in children under

two declined in the US post pneumo vaccination

Page 8: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Effect of PCV7 introduction on antibiotic prescriptions and ambulatory care visits

Zhou et al, Pediatrics 2008

Page 9: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Effect of PCV7 introduction on antibiotic prescriptions and ambulatory care visits

Zhou et al, Pediatrics 2008

Antibiotic prescriptions attributable to acute otitis media decreased from 1244 to 722 prescriptions per 1000 person-years – a 41.9% reduction.

Page 10: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Antibiotic consumption is increasing in

developing countries...

Source: Based on data obtained under license from IMS Health MIDAS ™ (January 2005-December 2010); IMS Health Incorporated. All Rights Reserved.

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Page 11: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared
Page 12: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Last-resort drugs are widely sold on the

retail market..

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Source: Based on data obtained under license from IMS Health MIDAS ™ (January 2005-December 2010); IMS Health Incorporated. All Rights Reserved.

Page 13: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Hospital use of carbapenems is rapidly growing

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Source: Based on data obtained under license from IMS Health MIDAS ™ (January 1999-December 2010); IMS Health Incorporated. All Rights Reserved.

Page 14: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared
Page 15: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Van Boeckel et al, Lancet Inf. Dis., 2014

Page 16: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Van Boeckel et al, Lancet Inf. Dis., 2014

Page 17: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared
Page 18: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Van Boeckel et al, Lancet Inf Dis, 2014

Page 19: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Antibiotic sales data can predict influenza in the United States

Polgreen, Laxminarayan et al. ICHE, 2010

Page 20: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared
Page 21: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Mortality outcomes are worse in neonates with resistant infections

!Kayange!M,!Kamugisha!E,!Mwizamholya!DL,!Jeremiah!S,!Mshana!SE.!2010.!Predictors!of!posiCve!blood!culture!and!deaths!among!neonates!with!suspected!neonatal!sepsis!in!a!terCary!hospital,!MwanzaF!Tanzania.!BMC!Pediatrics!10:!39.!

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Page 22: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared
Page 23: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

II. Drivers of antibiotic use relate to incentives and behavior of patients, physicians, pharma, payers and healthcare institutions.

Page 24: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Incentives for Physicians

•  Satisfying patient expectations

Page 25: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Dosh, J Fam Pr 1999

Page 26: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Health insurance increases prescribing

Foxman et, RAND Corporation,1987

Page 27: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Health insurance increases prescribing

Foxman et, RAND Corporation,1987

Page 28: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

What happens when antibiotics are provided free?

Overall increase in antibiotic prescriptions as well as substitutions to covered antibiotics from not-covered antibiotics.

Li!and!Laxminarayan,!Health'Economics,!2013!

Page 29: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

What happens when antibiotics are provided free?

Overall increase in antibiotic prescriptions as well as substitutions to covered antibiotics from not-covered antibiotics.

Li!and!Laxminarayan,!Health'Economics,!2013!

Page 30: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Hospital Incentives

•  Antibiotics may be a substitute for infection control

•  Infection control is often not compensated but longer hospital stays are beneficial to the hospital

Page 31: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

III. In the livestock sector, the tremendous increase in demand for animal protein will drive continued use of antibiotics in sub-therapeutic concentrations without changes in regulatory policy

Page 32: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Increase in demand for poultry in India and China between 2000 and 2030

FAO, 2011

Page 33: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Amounts, in mg, of veterinary antibacterial agents sold in 2007 per kg biomass of pig meat, poultry meat and cattle meat produced plus estimated live weight of dairy cattle. *2005 data.

**The substances included vary from country to country.

Grave K et al. J. Antimicrob. Chemother. 2010;65:2037-2040

Page 34: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared
Page 35: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Global antimicrobial consumption in livestock (top) and average standard deviation of estimates

(bottom)

van Boeckel et al, PNAS, 2015

Page 36: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Largest consumers of antimicrobials in livestock in 2010 and 2030

A)  Largest five consumers of antimicrobials in livestock in 2010 B)  Largest five consumers of antimicrobials in livestock in 2030 (projected). C)  Largest Increase in antimicrobial consumption between 2010 and 2030, D)  Largest relative increase in Antimicrobial consumption between 2010 and 2030.

van Boeckel et al, PNAS, 2015

Page 37: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

•  Global average annual consumption of antimicrobials per kilogram of animal produced was 172 mgs per kg for cattle, chicken and pigs

•  Global consumption of antimicrobials in food animal production was estimated at 63,151 (±1,560) tonnes in 2010 and is projected to rise by 67%, to 105,596 (±3,605) tonnes by 2030, !  In hotspots like India where areas of high consumption (30

kg per km2) for industrial poultry production are expected to grow 312% by 2030

(van Boeckel et al, PNAS, 2015).

van Boeckel et al, PNAS, 2015

Page 38: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Laxminarayan et al OECD Report, 2014

Page 39: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Difference in average daily growth between animals raised with and without AGPs

Laxminarayan et al OECD Report, 2014

Page 40: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Response by livestock to supplementation with growth promoters

Barug et al., 2006

Page 41: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Productivity reductions and costs per produced pig incurred by removing AGPs

Laxminarayan et al OECD Report, 2014

Page 42: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Effect of Danish ban on AGPs

DANMAP 97 (1998) DANMAP 2012 (2013); DANMAP 2004 (2005)

Page 43: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Categories of regulatory framework for the use of antimicrobial for growth promotion

Page 44: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Potential loss in annual meat production following AGP withdrawal (in %)

Laxminarayan et al OECD Report, 2014

Page 45: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Potential loss in the value of annual meat production following AGP withdrawal

Laxminarayan et al OECD Report, 2014

Page 46: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

IV. Who will pay the price of rising resistance – implications of AMR.

Page 47: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Loss of first line drugs increases drug costs

Source: WHO Policy Perspective 2005, adapted from WHO Model Formulary, WHO Clinical Guidelines and Management Sciences for Health’s 2004 International Drug Price Indicator Guide (slide courtesy: David Heymann)

Page 48: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Annual health gain (QALYs) in the US from procedures requiring

antibiotic prophylaxis

Page 49: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

V. Solving the problem – what can economics bring to the table?

Page 50: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

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Make better use of existing antibiotics

Image Courtesy of Shutterstock

Page 51: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Find new antibiotics

Image Courtesy of Shutterstock

Page 52: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Is the rate of new drug development declining?

Page 53: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Trends in development of new antibiotics

Page 54: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Laxminarayan, Science, 2014

Page 55: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Consider this

•  Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared with a 13% withdrawal rate for other therapeutic categories (Outterson et al 2013)

•  Under the Generating Antibiotic Incentives Now (GAIN) Act in the United States new antibiotics are given 5 years of additional market exclusivity for designated Qualified Infectious Disease Products

Page 56: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared
Page 57: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared
Page 58: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared
Page 59: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared
Page 60: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Important questions

•  Do we need public subsidies for new antibiotic development or will the market respond on its own?

•  What is the impact of public subsidies for new drug development on stewardship?

•  How can we change the rules of the game to incentivize appropriate use of new (and existing) antibiotics?

•  How do we balance access with concerns about resistance?

Page 61: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Once an antibiotic is introduced, resistance is not far behind…

Page 62: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

What kind of innovation?

•  Combination therapies that target both essential functions and resistance factors !  Eg. amoxicillin-clavulanate

•  Repurpose old drugs to optimize dosing levels and the duration, and route of administration !  E.g.optimized dosing of colistin to reduce toxicity and

improve efficacy

•  Prevent resistance by protecting non-target bacterial flora during treatments

•  Point-of-care diagnostics !  to identify both the cause of an infection and its sensitivity

to common antibiotics

Page 63: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Q: What should we be willing to pay for a stewardship program that would enable a

1-year delay in the need for a $1billion investment in a new antibiotic?

A: Roughly $60 million, at a modest 6% discount rate

Page 64: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Q: What does the US Government allocate for antimicrobial stewardship programs?

A: Zero

Page 65: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Q: What does the Indian Government allocate for antimicrobial stewardship

programs? A: What is a stewardship program?

Page 66: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

Closing thoughts

Page 67: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared
Page 68: Economics of Antibiotic Resistance - ETH Z · • Of the 61 new antibiotics approved between 1980 and 2009, 26 (43%) were withdrawn either because of toxicity or lack of market, compared

www.cddep.org/garp www.extendingthecure.org

Thank you