US Senate Reexamines 21st Century Cures Act To Consider Paper by Professor Kevin Outterson
Published in Health Affairs, the paper addresses faults in a proposed system for funding antibiotic development.
The United States Senate Committee on Health, Education, Labor & Pensions (HELP) is considering changes to a bill to account for recommendations made in a paper authored by Kevin Outterson, N. Neal Pike Scholar in Health and Disability Law, professor of law, and co-director of Boston University School of Law’s health law concentration. The paper was co-authored with Anthony McDonnell of the Review of Antimicrobial Resistance in London.
Published in the May issue of Health Affairs, “Funding Antibiotic Innovation with Vouchers: Recommendations on how to Strengthen a Flawed Incentive Policy,” addresses faults in a proposed system for funding new antibiotic development. The paper’s suggestions are being used to reexamine the 21st Century Cures Act, written to fund the National Institutes of Health and appropriate resources for biomedical research. It passed the House of Representatives in July 2015 and is currently under consideration by the US Senate HELP Committee.
Antibiotic resistance, due to the overuse of antibiotics and the lack of incentives to develop new ones, has led to a public health crisis that claims approximately 37,000 lives a year. Many proposals have been made to Congress in response to the need for a source of funding to research new antibiotics, but one has gained support recently that would establish a voucher system. The system recommends a regulatory measure in which pharmaceutical companies are granted a voucher to delay the entry of any new drug to the generic market in return for developing new antibiotics.
In their paper, Outterson and McDonnell examine the flaws inherent in the voucher system, arguing that it will lead to higher drug prices in the future. Since the vouchers would be transferrable, those higher prices could potentially be paid for life-saving cancer therapies or cardiovascular drugs. “This is not a bug, but an unavoidable design feature of the program,” they write. They question the fairness of such a practice that could lead to difficulties “ensuring appropriate access to all drugs both in the United States and abroad, where access to many therapies is already too limited.”
Outterson and McDonnell also note the potential constitutional challenges to allowing the vouchers to be transferred. Delinking the innovative product (the antibiotic) from the reward (patent exclusivity) evades the Patent and Copyright Clause and the entire history of US intellectual property law. They write: “Normally, the market for the innovation determines the value of the patent; here, an entirely different product determines the value. Vouchers replace the market function of patent valuation with a system designed by Congress.”
Two alternatives to the current iteration of the voucher system are proposed. First, Outterson and McDonnell suggest vouchers be tailored to account for the social value of the antibiotic under development. Since certain bacterial threats present greater risks than others, antibiotics developed to address those threats should receive vouchers of greater market value, in proportion to the value of the innovation. The second recommendation represents a reworking of the voucher system, and suggests the government auction off several high-value vouchers each year and use the proceeds to support antibiotic access, conservation, and innovation.
“Vouchers are attractive because they finances antibiotic research today by laying the cost on the health care system 10 years from now,” Outterson says, noting that it may be the best bet to meet the critical need for new antibiotic development “given the current political climate and the difficulty finding funding for anything long term.” While the voucher system “isn’t the first choice in terms of policy,” Outterson and McDonnell suggest modifications that they hope will result in the “ ‘least bad’ version of the proposal.”
Outterson is widely recognized for his work on the legal ecology of antimicrobial resistance. A founding member of the CDC Antimicrobial Resistance Working Group, Outterson serves as a partner in the European Union’s DRIVE-AB project to re-invigorate antibiotic R&D, and is an associate fellow at the Royal Institute of International Affairs at Chatham House in London. He has been named to the Advisory Panel for the Longitude Prize in the UK, which awards £10 million to address antibiotic resistance. He publishes frequently on the need to overhaul the current economic system driving antibiotic research and development. In 2014, he was called to offer expert testimony to the House of Representatives Energy and Commerce Subcommittee on Health as they considered the earlier House version of this bill. The Alliance for the Prudent Use of Antibiotics recently recognized his work with its prestigious 2015 leadership award.
On June 21, Professor Outterson will testify before President Obama’s Advisory Council on Combating Antibiotic Resistance, where he will present the results of a two-year study sponsored by the European Union on designing economic incentives for antibiotic development.
