European Commission: Proposed Pull incentives!

Note: Be sure to see the forward calendar: there is a webinar on 9 May during which Mark McClellan will speak with Sen. Todd Young, co-sponsor of the recently reintroduced PASTEUR Act! Don’t miss it!

Dear All,

For today’s note, we will be doing a dive into some very exciting AMR-related proposed legislation released by the European Commission (EC) late last week. There is a lot to digest! To get you started, try these entry points:

The AMR-related materials are extensive (including discussions of the value of Push incentives, the need for surveillance, the value of better use of diagnostics, and more), but this newsletter will focus on the way that the EC seeks to create EU-wide Pull incentives via a 2-step dance. As summarized on page 16 of the AMR-specific document:

“Incentives for development of and access to antimicrobials
“The EU needs both push incentives (i.e. funding for antimicrobial research and innovation, primarily via research grants and partnerships) and pull incentives (both regulatory and financial) to reward successful development and secure access to effective antimicrobials. The Commission is proposing the following pull incentives:
  • Temporary mechanism consisting of transferable data exclusivity vouchers, for the development of novel antimicrobials to be granted and used under strict conditions.
  • Procurement mechanisms for access to new and existing antimicrobials that would guarantee revenue for antimicrobials marketing authorisation holders, regardless of sales volumes.”

This is an amazing pair of Pull-focused proposals that are very much aligned with recent discussions of ways to create Pull incentives in Europe (e.g., the report discussed in this 2 Oct 2022 newsletter or the 13 Mar 2023 reflection paper from the BEAM Alliance):

  • Step 1 builds a bridge: Transferable exclusivity vouchers (variously called TEE/TEVs for Transferable Exclusivity Extensions/Vouchers) provide a one-off revenue event upon successful approval of an interesting new drug.
    • The principal virtue of the TEE/TEV approach is that is something that can be implemented via EU legislation that is currently undergoing a major revision. TEE/TEVs have known weaknesses (see Outterson & McDonnell 2016; Ardal et al. 2023), but nothing is perfect! Rather than hoping for a magical perfect solution and issuing yet another Call to Action that goes nowhere, the European Commission has recognized the urgency of the situation and is taking a very practical and pragmatic step. Rather like the experience with the NHS pilot, we’ll learn a lot just by initiating this process — well begun is half done! My hat is off to the Commission — THANK YOU! 
    • TEE/TEVs are being used as a bridge: no more than 10 vouchers would be permitted over the next 15 years.
    • Also important are the rules proposed for earning a TEE/TEV: New class, new mechanism, or addressing a multi-drug resistant organism and serious or life threatening infection. More on this in the detailed commentary below the signature block — it is critical that only products with obvious value be rewarded via this mechanism (and ditto for the procurement models in Step 2).
  • Step 2 is the long-term sustainable solution: But, we know that more is needed to sustain new drugs over the long term, so the next step is to encourage all Member States to define and implement procurement-based Pull incentives that could take the form of a revenue guarantee, market entry rewards combined with revenue guarantee, lump-sum market entry rewards, or milestone payments.

I’m still digesting all the details in these proposals but the high-level message is clear — the EU (technically, the European Commission — we will know if the European Council is serious by how they respond) is serious about Pull incentives in the EU! This is the fruition of the conversation that the community has been building ever since Sweden’s ground-breaking 2009 conference (“Innovative incentives for Effective Antibacterials” from which we have a pre-meeting report on policy options, a brief post-meeting report, a complete post-meeting report, and the post-meeting 1 Dec 2009 European Council Resolution that concluded with the call to the commission to “within 24 months, develop a comprehensive action-plan, with concrete proposals concerning incentives to develop new effective antibiotics…” that helped catalyze TATFAR, the ND4BB project, and more), the 3-year DRIVE-AB project as one element of ND4BB, the UK AMR Review and then testing via the UK NHS procurement pilot, the debates in the US about the PASTEUR, and so much more.

These proposals will doubtless provoke a lot of debate and it is likely that it will take at least a bit of time for them to be adopted (but, Sweden does currently hold the EU presidency and was the country that really kick-started things in 2009 … hmm!). All that noted, it is tremendously exciting that the Commission dug deeply into this topic and concluded that action is required … and required NOW. I could not agree more: taking practical, pragmatic steps today is necessary — if we await perfect solutions, nothing will ever happen!

MANY thanks to all who have contributed to this amazing moment! Woot, woot!

All best wishes, –jr

John H. Rex, MD | Chief Medical Officer, F2G Ltd. | Operating Partner, Advent Life Sciences. Follow me on Twitter: @JohnRex_NewAbx. See past newsletters and subscribe for the future: https://13.43.35.2/blog/. All opinions are my own.

=== DEEP DIVE DETAILS ===

Part 1 (TEE/TEVs): Last week the European Commission adopted proposals for an extensive revision of their entire pharmaceutical legislation. Within the Commission proposal for the Pharmaceutical Regulation, the key bits regarding Pull incentives for AMR are from Chapter III and start with the idea of creating transferable data exclusivity vouchers:

Article 40
Granting the right to a transferable data exclusivity voucher
1. Following a request by the applicant when applying for a marketing authorisation, the Commission may, by means of implementing acts, grant a transferable data exclusivity voucher to a ‘priority antimicrobial’ referred to in paragraph 3, under the conditions referred to in paragraph 4 based on a scientific assessment by the Agency.

2. The voucher referred to in paragraph 1 shall give the right to its holder to an additional 12 months of data protection for one authorised medicinal product.

3. An antimicrobial shall be considered ‘priority antimicrobial’ if preclinical and clinical data underpin a significant clinical benefit with respect to antimicrobial resistance and it has at least one of the following characteristics:
(a) it represents a new class of antimicrobials;
(b) its mechanism of action is distinctly different from that of any authorised antimicrobial in the Union;
(c) it contains an active substance not previously authorised in a medicinal product in the Union that addresses a multi-drug resistant organism and serious or life-threatening infection.

In the scientific assessment of the criteria referred to in the first subparagraph, and in the case of antibiotics, the Agency shall take into account the ‘WHO priority pathogens list for R&D of new antibiotics’, or an equivalent list established at Union level.

4. To be granted the voucher by the Commission, the applicant shall:
(a) demonstrate capacity to supply the priority antimicrobial in sufficient quantities for the expected needs of the Union market;
(b) provide information on all direct financial support received for research related to the development of the priority antimicrobial.
Within 30 days after the marketing authorisation is granted, the marketing authorisation holder shall make the information referred to in point (b) accessible to the public via a dedicated webpage and shall communicate, in a timely manner the electronic link to that webpage to the Agency.

Article 41
Transfer and use of the voucher
1. A voucher may be used to extend the data protection for a period of 12 months of the priority antimicrobial or another medicinal product authorised in accordance with this Regulation of the same or different marketing authorisation holder.
A voucher shall only be used once and in relation to a single centrally authorised medicinal product and only if that product is within its first four years of regulatory data protection.
A voucher may only be used if the marketing authorisation of the priority antimicrobial for which the right was initially granted has not been withdrawn.
2. To use the voucher, its owner shall apply for a variation of the marketing authorisation concerned in accordance with Article 47 to extend the data protection.
3. A voucher may be transferred to another marketing authorisation holder and shall not be transferred further.
4. A marketing authorisation holder to whom a voucher is transferred shall notify the Agency of the transfer within 30 days, stating the value of the transaction between the two parties. The Agency shall make this information publicly available.

Source for above materials.

In summary, a TEE/TEV would grant an additional year of regulatory data protection to the developer of the antimicrobial, which the developer can either use for one of its own products or sell to another marketing authorisation holder. Using it for another product is the expected outcome as this would provide a one-off burst of revenue. This would certainly be helpful to the antibiotic developer and issuing special 1-year extensions for particular drugs is not a new concept as you can see in this 2018 EMA slide deck about orphan and pediatric products. The proposal is to test this concept for 15 years with a maximum of 10 vouchers to be issued. 

Note in particular the list of criteria for earning a TEE/TEV require a clear demonstration of value: any or all of new class, new mechanism, and ability to address a multi-drug resistant organism or a serious/life-threatening infection. There is also an explicit reference to the WHO priority pathogen list (PPL; see this webpage for a summary of the PPLs proposed thus far).

Collectively, these characteristics are central to the ideas that Kevin Outterson and I proposed in 2016, that were used by the UK NHS pilot to select antibiotics of value (search for ‘slide 25’ in this newsletter), and that are highlighted in pipeline reviews by WHO. Not all products can (or should) earn a reward of this type!



Part 2 (Procurement Models): TEE/TEVs are an interesting bridge to long-term Pull in the EU, but they are just that … a time-limited bridge. For a long-term solution, we need procurement models that recognize the special issues of antibiotics.

Thus, the Commission also issued a proposal for a Council Recommendation on stepping up to combat antimicrobial resistance in a One Health approach. While this may just sound like more of the same, this document actually suggests procurement models at a member state level that have some characteristics of the PASTEUR Act. It also resembles the 2021 study led by Christine Ardal, with an honest recognition that it will take some time to create this process with all of the Member States.

See the below section from page 24 of the proposal. Note that this document is the Commission’s proposal for a Council decision. It will take some time to reach a Council decision — this process will not be automatic or easy:

G. Research & development and incentives for innovation & access to antimicrobials and other AMR medical countermeasures

The Council welcomes the Commission’s intention to and Member States are invited to:
27. Support research and technological innovation for the detection, prevention and treatment of infections in humans caused by antimicrobial resistant pathogens, including the establishment of and significant investment in a European partnership to allow coordination, alignment and funding of cross-sectorial research and innovation on “One Health AMR”.

28. Promote the development of and accessibility to antimicrobials and other medical countermeasures relevant to combat AMR in humans, notably diagnostic tests and vaccines targeting antimicrobial resistant pathogens.

To that end, the Council welcomes the Commission’s intention to:
a. support Member States in identifying priority antimicrobial resistant pathogens at Union and Member State level, in mapping existing, upcoming and missing AMR medical countermeasures, and in defining target product profiles; 
b. support research and development of AMR medical countermeasures, notably by coordinating funding of translational research and late-stage development of AMR medical countermeasures, including clinical trials for antimicrobials;
c. improve the continuity of supply of antimicrobials and other AMR medical countermeasures in the EU, notably by supporting and coordinating Member States’ initiatives on the manufacturing, procurement and stockpiling;
d. improve demand forecast, assessing and addressing antibiotics supply chain vulnerabilities, and implement targeted antibiotics stockpiling actions to avoid shortages.

29. Contribute to the design and governance of a Union multi-country pull incentive scheme in order to improve innovation, development and access to antimicrobials. Such scheme could take the form of revenue guarantee, market entry rewards combined with revenue guarantee, lump-sum market entry rewards or milestone payments. It should be implemented in a complementary manner to the regulatory framework applicable to medicinal products for human use.

30. Pool resources, take collaborative actions, financially contribute to the implementation of the pull incentive scheme, and commit to participate in the network60 referred to under the EU4Health work programme 2023.

31. Regularly review the scheme and its impact on the development and accessibility of antimicrobials.

32. Incentivise the development and placing on the market of alternatives to antimicrobials and vaccines for animal health.

Source for above material (jump to page 24).

Yow! A two-pronged approach that gets the groundwork going is a major development. In summary, the Commission is doing what it can in the near-term (broadly defined as 15 years … plenty of time for member states to engage) to build a bridge to a procurement-based delinked model. Fabulous!

Current funding opportunities (most current list is here)

  • The AMR Action Fund is now open to proposals for funding of Phase 2 / Phase 3 antibacterial therapeutics. Per its charter, the fund prioritizes investment in treatments that address a pathogen prioritized by the WHO, the CDC and/or other public health entities that: (i) are novel (e.g., absence of known cross-resistance, novel targets, new chemical classes, or new mechanisms of action); and/or (ii) have significant differentiated clinical utility (e.g., differentiated innovation that provides clinical value versus standard of care to prescribers and patients, such as safety/tolerability, oral formulation, different spectrum of activity); and (iii) reduce patient mortality. It is also expected that such agents would have the potential to strongly address the likely requirements for delinked Pull incentives such as the UK (NHS England) subscription pilot and the PASTEUR Act in the US. Submit queries to contact@amractionfund.com.
  • BARDA’s long-running BAA-18-100-SOL-00003 offers support for both antibacterial and antifungal agents. This BAA has offered 4 deadlines/year since 2018 … check the most current amendment for details.
  • INCATE (Incubator for Antibacterial Therapies in Europe) is an early-stage funding vehicle supporting innovation vs. drug-resistant bacterial infections. The fund provides advice, community, and non-dilutive funding (€10k in Stage I and up to €250k in Stage II) to support early-stage ventures in creating the evidence and building the team needed to get next-level funding. Details and contacts on their website (https://www.incate.net/).
  • It’s not a funder, but AiCuris’ AiCubator offers incubator support to very early stage projects. Read more about it here.
  • The Global AMR R&D Hub’s dynamic dashboard (link) summarizes the global clinical development pipeline, incentives for AMR R&D, and investors/investments in AMR R&D.
  • In addition to the lists provided by the Global AMR R&D Hub, you might also be interested in my most current lists of R&D incentives (link) and priority pathogens (link).


Upcoming meetings of interest to the AMR community (most current list is here):

  • 8-12 May 2023 (Lisbon, Portugal): 41st Annual Meeting of the European Society for Paediatric Infectious Diseases. Go here for details.
  • [NEW] 9 May 2023 (virtual, 2-3p ET): Duke-Margolis entitled webinar entitled Drug-Resistant Infections & the Immediate and Future Demand for Novel Antimicrobials. Register via that link to hear Duke-Margolis director Dr. Mark McClellan speak with Senator Todd Young, co-sponsor of the recently-reintroduced PASTEUR Act!
  • 3-5 Jul 2023 (Tours, France): 9th Symposium on Antimicrobial Resistance in Animals and the Environment (ARAE). Sponsored by INRAE (French National Research Institute for Agriculture, Food, and Environment, itself a merger of merger of INRA, the French National Institute for Agricultural Research, and IRSTEA, the French National Research Institute of Science and Technology for the Environment and Agriculture), this conference has been running since 2005. Go here for details.
  • [NOW OPEN FOR APPLICATIONS!] 7-15 Oct 2023 (residential, Annecy, France): ICARe, the Interdisciplinary Course on Antibiotics and Resistance. Now in its 7th year, this course is a deep-dive into the world of antibiotic development. Intense, rigorous, and HIGHLY recommended. Seats are always limited … apply sooner rather than later! Go here for details.
  • 20-23 Oct 2023 (Athens, Greece): 11th TIMM (Trends in Medical Mycology). Go here for details.

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