Kevin Outterson 11 Dec 2018 Global antibiotics pipeline is fragile 42 antibiotics in the global clinical pipeline in June 2018 1 but only 11 in development to treat superbugs on the WHO critical threat pathogen list ID: 1019453
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1. Current Market Conditions For AntibioticsKevin Outterson11 Dec 2018
2. Global antibiotics pipeline is fragile42 antibiotics in the global clinical pipeline in June 20181but only 11 in development to treat superbugs on the WHO critical threat pathogen list2Enterobacteriaceae (CRE)Pseudomonas aeruginosaAcinetobacter baumannii4/26/201921 Pew Charitable Trusts, September 20182 World Health Organization, “Global Priority List of Antibiotic-Resistant Bacteria to Guide Research, Discovery, and Development of New Antibiotics” 2017Company data as of 10 Dec 2018 unless otherwise dated
3. Discovery of novel antibiotics is not keeping up with emergence of new superbugs3This chart excludes bedaquiline, which is the first drug in a new class to treat tuberculosis.Source: Pew Charitable Trusts; Deak D, Powers JH, Outterson K, Kesselheim AS. Progress in the Fight Against Multidrug Bacteria?: A Review of FDA Approved Antibiotics 2010-2015. ANNALS OF INTERNAL MED. 2016 MAY 31. DOI:10.7326/M16-0291.34564/26/2019Company data as of 10 Dec 2018 unless otherwise dated
4. Need for both “push” and “pull” mechanismsDelinkage (i.e., revenues from value not volume)Global collaborationAccess and stewardship are integral (next slide)4/26/20194Consensus from research & policyCompany data as of 10 Dec 2018 unless otherwise dated
5. Support Innovation along with Stewardship & Access4/26/20195Company data as of 10 Dec 2018 unless otherwise dated
6. A difficult business model4/26/20196Company data as of 10 Dec 2018 unless otherwise dated
7. 4/26/20197Alan Carr, NeedhamNov 5, 20189/12 (75%) of US antibiotics launched since 2009 are being sold at a loss, even if the R&D had been free; none are in a position to recover R&D investmentCompany data as of 10 Dec 2018 unless otherwise dated
8. 4/26/20198Colistin, a dangerous drug with questionable efficacy, continues to dominate the CRE market, more than 40 months after the launch of ceftazidime /avibactam, meropenem /vaborbactam & plazomicinCompany data as of 10 Dec 2018 unless otherwise datedAlan Carr, NeedhamNov 5, 2018
9. Largest public antibiotic R&D companies down 37-89% last 6 months*Company data as of 10 Dec 2018 unless otherwise dated9AchaogenMelintaNabrivaTetraphaseParatekEntasisBiotech & NASDAQ down 1-3% same period4/26/2019*As of 12 Nov 18
10. 4/26/201910NDA approvedplazomicinHigh: $27March 3, 2017Dry: 1Q 2019Mkt Cap: $77MCompany data as of 10 Dec 2018 unless otherwise dated
11. Plazomicin launchFDA approval 20 July 2018Immediate launch w/54 hospital account managers (sales reps) and 12 medical science liaisons3Q sales of $291,000 (60% OP)Most sales for cUTI, not CREAve daily treatment cost: $945Avycaz $1,077Vabomere $990Cash sufficient for operations only until mid 1Q19; company for sale4/26/201911Company data as of 10 Dec 2018 unless otherwise dated
12. 4/26/201912IPOHigh: $15 IPO Sept 2018Mkt Cap: $79MCompany data as of 10 Dec 2018 unless otherwise dated
13. 4/26/201913Merger closes; 4 products in US marketHigh: $226July 24, 2015Mkt Cap: $87MCompany data as of 10 Dec 2018 unless otherwise dated
14. 4/26/201914NDA filed fosfomycinHigh: $10June 30, 2017Mkt Cap: $140MCompany data as of 10 Dec 2018 unless otherwise dated
15. 4/26/201915NDA approval omadacyclineHigh: $263June 1, 2007Mkt Cap: $221MCompany data as of 10 Dec 2018 unless otherwise dated
16. 4/26/201916NDANDA approved eravacyclineHigh: $51July 17, 20152Q 2020Mkt Cap: $87MCompany data as of 10 Dec 2018 unless otherwise dated
17. Difficult environment>$2.5B R&D spent to date by these 6 public companies* net of significant non-dilutive push funding$803Mcombined market cap 12 Nov 2018~$1.7B loss to investors, but the companies still need to raise cash to commercialize and get to break even4/26/201917*AKAO, ETTX, MLNT, TTPH, NBRV, PRTKAnd these are the companies with successful R&DAs of 3Q18$691 10 Dec 2018$1.91B 10 Dec 2018Company data as of 10 Dec 2018 unless otherwise dated
18. European Policy ResponsesUK pilot projectNICE and NHS England working with ABPI, oversight from DHSCMeetings for almost 2 yearsCommissioned work at Univ. of York, now completedParliamentary Select Comm on DHSC Oct 2018 called for Gov’t action w/i 6 monthsAPPG on AMR meeting 13 Nov 2018, Kevin spokeConditions on stewardship and accessSwedish pilot projectPolicy work led by Uppsala team from DRIVE-ABEarlier stage than UK4/26/201918Company data as of 10 Dec 2018 unless otherwise dated
19. Take-AwaysEven the most successful antibiotic R&D companies are facing serious challengesCompanies run dry starting 1Q19 The problems are not company-specific, but sectoralPush incentives are filling a vital rolePull incentives are not yet a reality, but urgently needed4/26/201919Company data as of 10 Dec 2018 unless otherwise dated