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Prize Fund to Delink Costs of R&D From Drug Prices

Shomita S. Steiner, PhD

Here’s the bottom line – innovation in drug development appears to be driven by the marketplace, the pharmaceutical industry, and regulatory agencies compounded by a system of patenting – which conspires to deny the patient’s immediate need – access to affordable life-saving treatment.


A focused effort to remedy this imbalance proposes the alternative option of creating a prize fund to tackle the serious issue of antimicrobial resistance (AMR). What is AMR and why is this the focus of a prize fund? In a nutshell – it’s an ongoing battle between the unseen microbial world and human kind –where at present, the microbes are winning. They achieve this but adapting rapidly to the currently available treatments (so called antibiotics), thereby making it almost impossible to treat common infections resulting in loss of human life. The last report released by the Centers for Disease Control (CDC) indicated that in the US at least 2 million people get an antibiotic-resistant infection, and at least 23,000 people die every year. That was in 2013. In 2018, this is likely to be higher because every day, new cases of antibiotic resistance are reported nationwide.


Among the various factors that must together address this massive challenge is the need for rapid development of new, improved, and perhaps alternative options to antibiotics that can at least keep up with or ideally get ahead of the ability of the microbe to change. Basically, this means incentivizing new ideas that can rapidly be moved to the market and be used in real time to save lives…limiting or removing the pharma monopolies on drugs that drive up pharmaceutical prices. Since it is a global threat, countries such as the UK and China have joined the US in a joint venture (Global Innovation Fund) to help speed up the innovation to counter the microbial threats. In the US, the APF administered by the National Institutes of Health (NIH) would initially consist of a total pot of $2 billion – which will be used to award three innovations based upon specified criteria. Key points that set this prize fund apart are that a. recipients must waive patent and other monopoly rights and b. set a reasonable price tag for the drug. This concept, like most new ideas has its supporters (particularly those in favor of delinking research and development (R&D) costs from drug prices) and opponents. It is important to weigh the pros and cons of this initiative and listen to both sides of the argument. The issues raised by opponents include important points such as regulatory delays that are standard problems with new drug development, costs associated with marketing, mandatory physician education associated with new drug use. These should not be ignored at the peril of human lives.


We have to start somewhere to change the way we tackle the need for better treatment options that are affordable and available in real-time. The idea of a prize fund is a reasonable option to address this issue.

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