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U.K. Pitches Radical Investment Plans to Fight Killer Bacteria

Britain will push the world’s biggest economies to develop new ways to pay for the fight against drug-resistant bugs, including a Netflix-style subscription plan for antibiotics aimed at stimulating a broken market, according to a person familiar with the matter.

The U.K. wants to encourage drugmakers to develop new antibiotics amid fears that Covid-19 is obscuring the march of antimicrobial resistance (AMR), which it views as a “silent pandemic,” the person said. Drug-resistance already kills hundreds of thousands of people each year and risks undermining health systems worldwide.

The issue is normally part of Group of Seven health discussions rather than a finance issue. But the British government, which hosts a meeting of finance ministers next month, argues that at its core AMR is an economic problem and requires the world’s biggest markets to act together.

Overuse of older, cheaper antibiotics has led to the emergence of new drug-resistant strains of bacteria that can cause severe damage, particularly in hospitalized patients, and threaten to spread more widely in the community. Their continued widespread use in animals to promote growth and retard disease has also been linked to the emergence of resistant strains in humans.

New antibiotic drugs cost an estimated 1 billion pounds ($1.4 billion) to develop yet health providers are unwilling to pay high prices, a combination that means they are frequently over-prescribed and unprofitable.

Large pharmaceutical companies have all but abandoned antibacterial research, despite some recent industry-led efforts. While 11 new antibiotics have been approved since 2017, the majority are derivatives of existing classes, the World Health Organization said in a 2020 report, and new treatments are “urgently needed.”

Antibiotics add an average of 20 years to life expectancy around the world, experts say. If they stop working everything from simple surgery to cancer research and efforts to defeat common illnesses would become more complicated, costly and often impossible.

In a bid to avoid this scenario the U.K Treasury wants to encourage a suite of G-7 policy proposals aimed at revitalizing the market for new antimicrobials, according to documents seen by Bloomberg.

One U.K. proposal is a subscription model similar to one trialled in Britain, whereby health providers pay an annual fee based on the value of drugs they want to access rather than sales or usage volume, the person familiar with the proposals said.

Such a plan would aim to help cover research and development costs and ensure pharmaceutical companies can deliver profits even as governments encourage lower usage of common drugs.

The British plan — which officials believe needs wide-ranging international buy-in, rather than action by one or two states — would see AMR elevated to a priority on the G-7’s finance track.

The U.K. is also urging ministers to support more responsible investments that better consider the impact on AMR across the health spectrum, including on animals, plants and the wider environment, the documents say.

The Treasury declined to comment. In a Bloomberg interview in March, U.K. Chancellor Rishi Sunak described AMR as an “interesting area” that is part of the ongoing effort to improve global health security.

Worldwide, some 700,000 people each year as a result of drug-resistant diseases and infections, a number that could rise to 10 million every year by 2050, according to the 2020 WHO report. That would make AMR one of the leading causes of death in the world, surpassing cancer.Already at least 2.8 million people in the U.S. contract an antibiotic-resistant infection each year, and more than 35,000 people die, according to the Centers for Disease Control and Prevention. Expensive treatment costs European Union health care systems more than a billion euros a year. Still, a 2019 report by the Organisation for Economic Co-operation and Development concluded that only a minority of EU countries had identified specific funding sources to implement national action plans, while investments were insufficient.

The U.K. plan aims to propose several other options alongside the subscription idea, according to the documents. They could include:

· Awarding a special status to new drugs, allowing for higher prices

· An annual revenue guarantee per antibiotic

· Significant rewards to pharmaceutical companies ($800 million-$3 billion) for entering the antibiotic market. These could be implemented through the G-20 or the European Union, for example

· An antibiotic investment levy applied by governments on a pay-or-play basis, meaning companies either pay the charge or invest in R&D addressing AMR. Alternatively, the surcharge could be placed on all producers with successful ones getting a rebate. Such a proposal could also be used to finance other options, including the subscription option, the U.K. believes.

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