Strammer Logo
Encouraging R&D in Antibiotics Businesses

Encouraging R&D in Antibiotics Businesses

The Healthcare System: Encouraging the Antibiotics Business

In April 2019, biopharmaceutical company Achaogen, a reliable player in the global market for its newly released Zemdri (plazomicin) drug treating tract and bloodstream infections, has filed for bankruptcy. It is not necessarily a surprise for a business to fail, but a concern arises when formally stable pharmaceutical companies all but collapsed simultaneously. In 2018 alone, it was reported that 3 large biotech firms closed their research programmes while their livelihood and existence were left to question. Unfortunately, the case of Achaogen is not a rare instance, despite 15 years dedicated to research and development and its drug being securely approved. The reality is that the unpredictability of today’s pharmaceutical market is gradually overwhelming businesses and ultimately hurting the healthcare system.

The World Health Organisation (WHO) has voiced their concern about the decreasing numbers of new antibiotics being developed to combat the epidemic threat of antimicrobial resistance. This is when bacteria become impervious to existing medication. The potential decrease of medication could be partly due to businesses closing their doors. Therefore, WHO actively brings awareness to the possible catastrophic events if there were fewer antibiotics to treat certain ailments and diseases. A further challenge is presented as the public health pushes physicians to resort to using older medication for as long as possible, despite a resistance developing overtime.

Director-General of WHO, Dr. Tedros Adhanom Ghebreyesus, added;

“…There is an urgent need for more investment in research and development for antibiotic-resistant infections including TB, otherwise we will be forced back to a time when people feared common infections and risked their lives from minor surgery. »

While the closure of antimicrobial resistant biotech firms has yet to happen on a large-scale level, WHO has every right to express unease. Just after announcing their involvement to help search for life-threatening cures against infections or ‘superbugs’, Switzerland-based healthcare company Novartis ended their antibacterial and antiviral research projects. Novartis’ exit came at a time just as others began leaving, like Allergan and AstraZeneca. Only a few well-known names remain in the project, like Pfizer and Roche.

Based on a recent report, it was discovered that most pharmaceutical antibiotic firms fail due to their small size in relation to the constraints within the market. For example, small size companies tend to own less than $100 million or €90 million in capital with limited access to external grants or subsidiaries. Although such funding is enough to get firms through the research and development phase, many of them struggle to stay afloat during the commercializing phase or the period it takes to earn profits.

In 2018, DriveAB, a European coalition, did a study to examine the production and distribution of antibiotics and the companies involved. To help raise the low numbers, they recommended that first-time market entrants be rewarded as well as payment for drugs bought could be dispersed or extended over the life span of the drug so as to encourage continual drug production.

In conclusion, the pharmaceutical industry faces high costs in spending with no guarantee of a high rate on return. Sadly, companies will not only be the ones suffering as patients in the healthcare system will also have to wait cautiously to see what further progress can be done to help curve ongoing concerns of the lack of new antibiotics. However, with the continuous help of organisations bringing awareness to the issues, solutions and results can be met effectively so that those worried can be at ease.


  1. The Antibiotics Business is Broken- But there’s a fix, April 2019, WIRED
  2. The world is running out of antibiotics, WHO report confirms, 2017, WHO
  3. Pharmaceutical companies are backing away from a growing threat that could kill 10 million people a year by 2050, July 2018, BusinessInsider
  4. Novartis Exits Antibiotics Research, Cuts 140 Jobs in Bay Area, July 2018, Bloomberg