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UK pharma proposes licence fee system to fund antibiotic R&D


The UK's pharma industry has proposed a licence fee system to fund development of new antibiotics, according to a Monday report from MPs.

The Association of the British Pharmaceutical Industry (ABPI) said the approach, outlined in the House of Commons Science and Technology Committee's report, was necessary because existing pricing and reimbursement arrangements are failing to provide pharma companies with sufficient return on their R&D investments in antibiotics.


The report noted the well-documented concern among health experts and politicians that while antibiotic-resistant bacteria strains are becoming more common, there have been very few new antibiotics developed.


There is also concern that the problem is being compounded by overuse of antibiotics in healthcare and in veterinary medicine, according to the report Ensuring Access to Working Antimicrobials.


In a separate statement reacting to the committee's report, the ABPI gave more details, arguing that antibiotic research should be funded by a central licence fee, paid by government to industry as insurance against emergence of bacterial resistance once an agent has been approved.


Authors of the report noted that the idea had backing from pharma companies, which argued revenues from conventional pricing and reimbursement arrangements are not sufficient given that antibiotics should be used only sparingly to prevent the emergence of resistant strains.


Licence fee arrangements would remove pressure on local budgets and ensure prescribing is based on clinical need, budgetary impact was predictable and research into treatments for rarer pathogens is incentivised.




According to oral evidence cited in the report, the UK's Pharmaceutical Price Regulation Scheme (PPRS) will not provide any incentive for development of antibiotics.


Under the voluntary PPRS scheme for branded pharma, the industry pays back to the National Health Service (NHS) any overspend on drugs above pre-agreed limits.


James Anderson, European Partnerships Director of GSK, said in evidence to the committee:


"Our hope for the new PPRS scheme is that it will enable a much more rapid uptake by the NHS of new products. In every case, apart from antibiotics, that would make a big difference to patients coming through.


"However, in antibiotics you almost want the opposite. You do not want a rapid uptake of new products; you want them to be used only by those patients who really need them, for whom none of the other products will work."


In a separate statement backing the idea, the ABPI said the licence fee system could potentially be used across Europe and the rest of the world.


The ABPI said: "The implementation of an insurance-type model globally would also facilitate access to new antibiotics for low and middle income countries at a local price that would not promote inappropriate use and enable these countries to treat infections caused by drug resistant pathogens; thereby limiting the development and spread of resistance."




The UK could take a lead role in setting up this system, according to the ABPI, but is concerned that the prime minister's review into antiobiotic resistance announced last week could cause delays.


Louise Leong, ABPI director of R&D policy said:


"While the panel undertakes its review, the UK should take a leadership role to pilot an alternative reimbursement model for antibiotics that can be adopted to support effective antibiotic stewardship and research and development in the short term."



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