PFE Pfizer Inc

By Denise Roland 

More than 80 drug and diagnostic companies have committed to working together to develop new antibiotics, while calling on governments to improve the financial incentives for doing so, in a declaration released at the World Economic Forum in Davos, Switzerland.

The group, which includes pharmaceutical giants such as Johnson & Johnson, Novartis AG, Roche Holding AG and Pfizer Inc., said combating a "dramatic" increase in drug-resistant bacteria required governments to create market incentives for developing new antibiotics and diagnostic tools.

The threat of superbugs has moved up the political agenda in the past year, with the White House issuing an extensive plan to fight superbugs and U.K. Prime Minister David Cameron warning they could "cast the world back into the Dark Ages of medicine where treatable infections and injuries will kill once again."

The pharmaceutical industry has largely reduced or abandoned efforts to develop new antibiotics due to the low likelihood of getting a return on investment. Any new antibiotic would need to be used sparingly to conserve its effectiveness, meaning sales would be slow.

Signatories to the declaration said breaking the link between revenue for new antibiotics and the amount of use would help address this problem, as would mitigating the financial risk for developers. They said possible approaches included giving developers a lump sum for launching a new antibiotic or insurance-like payments to companies for supplying innovative drugs.

They added that in developed markets, governments should be prepared to pay for new antibiotics and diagnostics with prices that "reflect the benefits they bring."

They also called on governments to bolster efforts to conserve existing antibiotics by ensuring health systems prescribe the drugs only when necessary. The group said one way this could be achieved would be providing better reimbursement for rapid diagnostic tools to curb antibiotic use in situations where they wouldn't be effective, such as viral infections.

Jim O'Neill, the former Goldman Sachs economist who is running a review on antimicrobial resistance for the U.K. government, called the declaration a "major step forward" in establishing a global response to the threat of drug resistance.

"I'm really impressed that such a wide range of companies have been able to agree on a common set of principles and commitments across these important issues," he said. "This is a level of consensus that we have not previously seen from the industry on this topic."

The group said it would review and update the declaration every two years "to reflect progress and changing priorities," and invited other companies to add their signatures to the declaration.

Write to Denise Roland at Denise.Roland@wsj.com

(END) Dow Jones Newswires

January 20, 2016 19:14 ET (00:14 GMT)

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