Novel Antibiotics: fixing incentives
Updated: Jan 23
Unlike tackling climate change, creating new antibiotics ought to be relatively solvable-yet the years tick by, antimicrobial resistance grows and no novel drugs emerge, abandoned by Big Pharma because they can't make money from them.
Market Entry Rewards, which gives payments upfront for success, need to be on steroids, combined with subscriptions where only public health authorities determined how, when and how often the drugs are used. We propose a funding mechanism that taps capital markets. Investors get to say they are investing in novel antibiotics via a financial instrument with low risk. The use of proceeds for a good cause is guaranteed and said investors don’t have to factor in, less be responsible for, the actual health outcomes. Smaller, innovative companies find shelter through the precarious trials process. Governments get visibility on interest payments with flexibility on repayment. Companies get a modest but predictable rate of return. It might work. Click on the image below to read our white paper.