Plazomicin (Achaogen) financial post-mortem: #PassPASTEUR

Dear All (and with thanks to Kevin for co-authoring and also a wonkish alert … get your coffee and settle in for the details),

If you’ve been around the antibiotic ecosystem for a while, you’ve hopefully heard the story of the 2019 bankruptcy of Achaogen and the subsequent loss to the entire world of its aminoglycoside, plazomicin. A recently published post-mortem by Wells, Nguyen, and Harbarth gives us a deeply insightful and sobering financial perspective on those events. The paper is required reading — and here are the links you need to follow the plot:

• The primary paper: Nadya Wells, Vinh-Kim Nguyen, & Stephan Harbarth. Novel insights from financial analysis of the failure to commercialise plazomicin: Implications for the antibiotic investment ecosystem. Humanit Soc Sci Commun 11, 941 (2024). https://doi.org/10.1057/s41599-024-03452-0.
  • Download this and read it in its entirety.
  • The supplemental materials provide some useful numerical summaries.
• Newsletters that give you a feel for the collapse of plazomicin in real-time
  • 22 April 2019: “Scary, Scarier, Scariest: Achaogen / FT editorial / CBS “60 Minutes” on AMR”: Reviews an excellent summary by Alan Carr of the bankruptcy along with a sobering editorial by Jeremy Farrar (at that time, Director of Wellcome Trust) that concludes that There is no viable path for new drugs, however valuable they are to society.”
  • 11 July 2020: “Plazomicin EU marketing application is withdrawn: Near zero market value of newly approved antibacterials”: EMA offers to approve it but Cipla (the new owner) says “Thanks, but no thanks” in an open letter that highlights the financial issue.
• Finally, see below our signatures if you need a reminder of the properties of plazomicin
  • Summary: A valuable drug for Gram-negative infections because it maintains activity in the presence of resistance mechanisms that inactive other drug classes (e.g., beta-lactams) in Enterobacteriales. Because of that it would definitely would be valuable in the clinic from time to time … and that’s exactly the pattern of use we would like to see for all new antibiotics!

The deep-dive into the cold, hard facts: What did the authors find?

• The authors (a team from the Geneva Graduate Institute and the University of Geneva) reviewed public regulatory documents, financial statements, investor presentations, and bankruptcy documents to enable them to reconstruct the entire history of Achaogen and plazomicin from a financial standpoint.
• Key results
  • Phase 1 began in 2009, approval in 2018 was based on a Phase 3 trial in complicated UTI vs. meropenem.
  • The approved indication was limited to cUTI in patients with limited or no treatment options.
    • Efforts to generate data in highly resistant pathogens in a comparison with colistin-based therapies were stopped for futility when only 39 patients had been enrolled despite screening ~2,000 patients.
    • The limited data were consistent with activity.
  • Financially, the company raised close to $800m ($776 per our tally)
  • But, all was for naught: sales were dismal and ultimately the company was sold at auction for $16m to Cipla and Sihuan Pharmaceutical (China)..
• And plazomicin to date has limited availability in the US and India. There is a global named patient access program.

The heart of the paper: What did the authors conclude? Here you need to be sure to read the paper as it contains a wealth of detailed analyses. Ultimately, these are the big findings:

1. “Novel antibiotics with narrow approval for small patient populations affected by severe resistant infections cannot be successfully commercialized in the current US antibiotic market.
2. “SMEs need incentive payments structured to enable them to survive the commercialisation cashflow drought.
3. “These changes are necessary to restore industry and financial investor confidence in the antibiotic SME development model.”

Let’s take them bit by bit.

1. “Novel antibiotics with narrow approval for small patient populations affected by severe resistant infections cannot be successfully commercialized in the current US antibiotic market.”

• Read all that very carefully … it’s a big statement. 
• The authors argue (and correctly, we think) that it could be said that plazomicin was the wrong drug (there is a strong dislike for aminoglycosides in the US due to their toxicities) in the wrong place (the US guidelines and microbiology practices made use of plazomicin difficult) at the wrong time (infections requiring plazomicin are uncommon as yet in the United States).
• But, and its a VERY big but similar problems have contributed to the failure of many other agents: the difficulties of eravacycline, omadacycline, and lefamulin are all discussed briefly. As the authors note: “Can they really all be ‘bad drugs’?” No — the problems are deeper.
• One way to see the depth of the problem is to look at the delays in access even in high-income countries that were analyzed in 2021 by Outterson et al.:
  • Source paper: Outterson et al.: Patient access in fourteen high-income countries to new antibacterials approved by the FDA, EMA, PMDA, or Health Canada, 2010-2020. Clinical Infectious Diseases. 2021 (doi: 10.1093/cid/ciab612).
  • See also the 19 Aug 2021 newsletter and related YouTube video.
  • In brief, both innovative and noninnovative antibiotics reached these major markets only after some years, if at all: