Here we go again. Entasis Therapeutics has been struggling in the public marketplace. There is certainly a risk that it will be going the way of Melinta, Achaogen, Tetraphase and the Dodo bird. Investors just do not believe that antibiotics companies can provide a return on their investment – and they are probably correct.
Entasis is a spin-out from Astra-Zeneca established in 2015. The company was based on pre-clinical assets and recruited a number of smart and dedicated scientists. Their IPO in 2018 was disappointing even though they raised $75 million. Their pipeline includes sulbactam-durlobactam for infections caused by antibiotic-resistant Acinetobacter that has completed its phase 3 trials and zoliflodacin that is undergoing its phase 3 trials for uncomplicated gonorrhea including highly resistant infections. While both of these products are greatly needed by a few, they may be market flops because of the small patient numbers involved.
Entasis has done much to secure financial success. They have partnered with a Chinese firm for the development and marketing of sulbactam-durlobactam and have partnered with GARDP, a non-profit based in Geneva, SW for the development and marketing of zoliflodacin (I was on the GARDP advisory board at the time).
Investors, though, have not been impressed. Entasis’ market cap has been constrained since the IPO and recently their financial runway was compressed to months. Their major investor, Innoviva, may come to the rescue by taking the company private once again. But will they and other investors ever realize a reasonable, if any, return? Previous examples of similar pathways for antibiotic biotech are not encouraging. Even if BARDA comes to Entasis’ rescue as they did for Paratek, their ultimate destiny may only be delayed without a more important market intervention.
The story of Entasis is not new, not unique, and in fact, will be the rule for all of antibiotic biotech if something does not change. And this is dangerous! It’s a danger that we all have seen coming, that we have all been warning about from the rooftops for years. Antibiotic resistance is now thought to directly contribute to 1.7 million deaths per year globally with most coming from lower respiratory infections. Our antibiotic pipeline to deal with the problem of resistance remains pathetic. 95% of new antibiotics are being discovered and developed in small biotech companies like Entasis. The antibiotic market failure is the sword of Damocles hanging over antibiotic biotech and their products. Their doom is inevitable without rescue from this failed market.
Many are encouraged by the subscription plans in the UK and Sweden. Although these plans may serve as models, they cannot provide the kind of market intervention we need to save antibiotic biotechs. This must come from large economies like Europe and the US. The US effort to provide a government-based market intervention has been foundering for years. I continually lose track of the various different congressional efforts (Cure 2.0, PASTEUR, DISARM, etc) that go nowhere, obtain no co-sponsors, are not debated and never become law. Europe is also planning on something – but apparently, they don’t know what it will be and whatever it is won’t occur before 2024.
It seems like we have learned little from our experience with covid. The idea of thinking ahead to avoid public health crises seems somehow not to apply to bacterial infections and the antibiotics that we use to treat them. Unlike covid, antibiotic resistant infections is a slow moving process heading inexorably towards global disaster. For antibiotics, if we act now, we can avoid the worst. But we remain ostriches with our heads in the sand. “If I close my eyes, they won’t see me.”
The US dithers, Europe ponders and the extinction of life-saving antibiotics continues apace.
