The development of new antibiotics relies heavily on small and medium-sized biotechnology enterprises (SMEs). However, most SMEs sponsoring an antibacterial approved by the FDA since 2010 have faced bankruptcy or exited at a loss. This study uses the financial disclosures of Achaogen, a company that developed plazomicin, to analyze its commercialization failure. The analysis reveals three key implications for the antibiotic investment ecosystem: (1) antibiotics with narrow approvals for small patient populations are difficult to commercialize in the current US market; (2) SMEs need incentive payments to survive the commercialization cash flow drought; and (3) changes are needed to restore investor confidence. The study highlights that current proposals to incentivize innovation may be insufficient to ensure access to novel antibiotics.

Nadya Wells, Vinh-Kim Nguyen, Stephan Harbarth