On Tuesday, the White House announced that Obama’s 2016 budget will include a hefty investment in antibiotic-resistant bacteria. The President’s plan includes about $1.2 billion worth of funding for research to combat drug-resistant bacteria strains, something Mr. Obama says has become one of the world’s most important public health issues.
What Does This Mean For Biotech?
The race is on for the development of new antibiotics in a field that seemed to be all but abandoned just a few years ago. The new funding means companies who are working to develop new antibiotics could be handsomely rewarded.
Who’s In
Achaogen Inc. AKAO is a small biotech company that is currently developing a treatment for a resistant bacteria that stems from hospital-borne pneumonia called MDR CRE. The Center for Disease Control and Prevention has already highlighted this germ as a public heath threat and called for aggressive action against it.
Enanta Pharmaceuticals, Inc. ENTA is a company whose primary revenue comes from Hepatitis C treatments, but has focused its research and development capabilities on drug resistant bacteria. The company is developing bicyclolides to treat resistant strains, which Enanta claims will take decades to become ineffective against bacterial infections.
Large pharmaceutical companies like Actavis PLC ACT and Merck & Co., Inc. MRK began their own ventures into antibiotic research though strategic acquisitions in 2014. Merck is set to pay $8.4 billion in order to acquire Cubist, a smaller company whose focus has been on antibiotics. Actavis took a similar path, snapping up Forest Laboratories for $25 billion and Durata Therapeutics for more than $800 million.
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