Economic Incentives for Antibacterial Drug Development: Alternative Market Structures to Promote Innovation

  • Marina L. Kozak
  • Joseph C. LarsenEmail author
Part of the Emerging Infectious Diseases of the 21st Century book series (EIDC)


The current economic model for antibacterial drug development and commercialization does not provide sufficient financial returns that reflect the societal value that new antibacterial agents provide. As such, the pharmaceutical industry has largely focused their development efforts on therapeutic areas where greater profit potential exists resulting in a substantial innovation gap in antibacterial drug development. The number of new antibiotics in development is likely too small to withstand technical attrition and increasing rates of bacterial resistance. New market models are needed that reward innovation in antibacterial drug development and provide a stronger return on investment for companies still operating in this space. While rewarding innovation, these models should also promote stewardship of new antibacterial drugs and ensure access to all patients that need them. This chapter explores various proposals for alternative market models and their associated policy considerations.



Antibiotic Development to Advance Patient Treatment


Antimicrobial resistance


Biomedical Advanced Research and Development Authority


US Centers for Disease Control and Prevention


US Centers for Medicare & Medicaid Services


Developing an Innovative Strategy for Antimicrobial Resistant Microorganisms Act


Drugs for Neglected Diseases Initiative


Diagnosis-Related Group


Driving Re-investment in R&D and Responsible Antibiotic Use


Expected Net Present Value


US Food and Drug Administration


Generating Antibiotic Incentives Now


Global Antibiotic Research and Development Partnership


Global Union for Antibiotics Research and Development


Health and Human Services


Infectious Diseases Society of America


Innovative Medicines Initiative


Intellectual Property


Joint Programming Initiative on Antimicrobial Resistance


Market Entry Reward


New Drugs for Bad Bugs


National Institute for Allergy and Infectious Diseases


US National Institutes of Health


Net Present Value


New Technology Add-on Payment


Other Transactional Authority


President Advisory Committee on Combating Antibiotic-Resistant Bacteria


President’s Council of Advisors for Science and Technology


Priority Review Voucher


FDA qualified infectious disease products


Research and Development


Reinvigorating Antibiotic and Diagnostic Innovation Act


Return on Investment


TransAtlantic Task Force on Antimicrobial Resistance


Transferable Intellectual Property Rights


World Health Organization


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Copyright information

© Springer International Publishing AG, part of Springer Nature 2018

Authors and Affiliations

  1. 1.Health Scientist, Division of CBRN Medical CountermeasuresBiomedical Advanced Research and Development AuthorityWashington, DCUSA
  2. 2.Division of CBRN Medical CountermeasuresBiomedical Advanced Research and Development AuthorityWashington, DCUSA

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