(Bloomberg) — Pharmaceutical companies should “pay or play” to spur research into new antibiotics and prevent drug-resistant infections from causing 10 million extra deaths a year by 2050, according to a report commissioned by U.K. Prime Minister David Cameron.
Companies that don’t devote resources to develop antibiotics should pay a levy of 0.25 percent of annual sales into a pooled fund to support market rewards for rivals who successfully develop new treatments, said Jim O’Neill, who chaired the government’s Review on Antimicrobial Resistance.
“For those pharmaceutical companies that are prepared to undertake the complex, challenging and sometimes costly process of trying to get new antibiotics, they would either be exempt or get their money back,” O’Neill said. “Money could be found by a small surcharge on the rest of the industry that chooses not to play.”
Acknowledging market failures that led to a dearth of new antibiotics, O’Neill’s final 84-page report released Thursday recommends a lump sum payment of as much as $1.3 billion as a reward for a successful developer of a new antibiotic drug. Other suggestions included taxes on antibiotics and transferable vouchers to let successful developers go to the front of the line for any drug awaiting regulatory approval.
In one of his more controversial proposals, O’Neill also suggested developed countries should be required by 2020 to use diagnostic tests before antibiotics are prescribed in order to discourage overuse.
“We think this would have huge beneficial influence in terms of making us not treat antibiotics like sweets as we currently do,” O’Neill said.
An estimated $40 billion over 10 years is needed to fund global action against antimicrobial resistance, the review says. The report estimates $16 billion is required to overhaul the antibiotics and tuberculosis research and development pipeline, using incentives such as market-entry rewards which could be funded by pharmaceutical companies under a “pay or play” program.
The pharmaceutical industry criticized the report’s recommendation that companies should foot the bill for combating anti-microbial resistance.