Carb-X

CARB-X: Accelerating global antibacterial innovation to combat resistance

Hosts:
Caroline Duell, Director Media & Communications, MTPConnect
Andrew Bowskill, Director Stakeholder Engagement Queensland, MTPConnect

Guest: Richard Alm, PhD, Chief Scientific Officer, CARB-X

00:02  Richard Alm
So upfront, I mean, I’ll say that CARB-X would love to have been accelerated in Australia supporting obviously the Australian ecosystem but also, you know, the Western Pacific as well, because I think there are things going on in New Zealand that we don’t hear about enough. And so I do think an accelerator in this area, you know, geographically this area would be, you know, exceptionally beneficial both to us and CARB-X, but also to the, you know, the greater ecosystem within Australia.

00:45  Caroline Duell
Hello and welcome to the MTPConnect podcast. I’m Caroline Duell, our guest on today’s podcast is Richard Alm. He’s the scientific officer at CARB-X, the Combating Antibiotic Resistant Bacteria Biopharmaceutical Accelerator, which is based at Boston University. CARB-X is a global nonprofit partnership focused on supporting antibacterial research. Richard joined CARB-X following almost 20 years working in drug discovery in large pharmaceutical infection R&D teams and spending some time at a small, antibacterial biotech company. He obtained his Ph.D. in microbiology from the University of Adelaide, and prior to joining industry he held two postdoc positions in the AMR area, one in Australia and one in Canada. It’s a great pleasure to welcome you to the podcast, Richard.

01:35  Richard Alm
Thank you. So happy to be here.

01:38  Caroline Duell
My co-host today is Andrew Bowskill. He’s MTPConnect’s Director of Stakeholder Engagement for Queensland and co-chair of AAMRNET Australia’s Antimicrobial Resistance Network. Hi, Andrew.

01:51  Andrew Bowskill
Hi, Caroline.

01:52  Caroline Duell
Okay, so Richard, you’re originally from Adelaide. Welcome home. What brings you back to Australia for this trip.

02:00  Richard Alm
Yeah. So it’s actually an interesting story. I think that’s one of the positives from out of COVID I guess is the ability to work remotely. And I came back after obviously not being out of travel for two years. I came back for the Lorneinfection meeting in February and presented at that and actually caught up with some people I had used to work with I knew that were happy to see me in person and then spent a couple of weeks. My family’s all still in Adelaide and then when I went back I was given the opportunity from the CARB-X management, whether I wanted to work remotely from Australia for a couple of months and do some outreach as our new funding was coming. And so I came back in May for a little surprise visit to test whether I could function at three in the morning, because obviously the time difference is hot. So I came home for a surprise visit for Mother’s Day, and then came, I guess, early July, and I’ll be here for a couple of months.

03:01  Caroline Duell
Oh, that’s great. Great news. And well, tell us more about CARB-X and how the organization that you’re working for came about and how did you end up there?  It’s a long way from Adelaide.

03:14  Richard Alm
It is. So I am. So first of all, CARB-X. So CARB-X was founded in 2016. It came out of really President Obama’s executive order around combating antibiotic resistant bacteria. And so the order was to make an accelerator and it was competitively bid. And the BU team, led by Kevin Outterson, won the grant from BARDA, which is from the Department of Health and Human Services in the US government, and then raised money from Wellcome Trust. And then three other partners joined shortly after, the governments of Germany and the UK, as well as the Bill and Melinda Gates Foundation. So we have five funders and the initial investment was for five years. So that went through to sort of like 2021 and we’ve just been renewed. So BARDA has just put in another 300 million over ten years and Wellcome Trust has put in, I think 70 million over three. So that’s good news. And so yeah, CARB-X is a very unique model. Uh, funds early, early-stage product development from sort of hit to lead through to first time in human clinical trial on a completely non-dilutive basis. And I’ve been in Boston, based in Boston now for I guess 26 years. So originally I did my PhD in Adelaide and then went to University of Victoria in Canada to my first postdoc with a with an expat Australian who’s chair of the department there he was out of Melbourne and then I came back to the IMB in Queensland to do a second postdoc for three years. And during that time the professor that I was with in Victoria, Trevor Trust, he had been funded by Aster at the time and he got asked to set up a research satellite in Massachusetts. And so he invited me back and that was in 96. And so I said I’d go back for a couple of years and I’m still there. I worked for AstraZeneca for almost 20 years in various roles and responsibilities from early target ID through to support of clinical products. And then when infection sort of ended at AstraZeneca, that was 2015. They exited out of the space and spun out Entasis Therapeutics. I actually went to a small startup company then called Macrolide Pharmaceuticals, where we were just four people at the start. So that was kind of exciting, completely different to having the infrastructure of the Big Pharma. But during that time I was the principal investigator on our CARB-X grant. And so then when that company pivoted away from infection, as a lot of companies unfortunately are doing, it was a chemistry based platform company. They pivoted to awards rare diseases. I reached out to some colleagues that I had known from AstraZeneca that were at CARB-X to see what opportunities were there. And I joined CARB-X then in 2019. So I’ve been there ever since.

06:18  Caroline Duell
What a journey. And you talk about that many companies are moving away from this type of research. So why the focus on AMR for CARB-X and what are the particular challenges for antimicrobials that make an organization like CARB-X so necessary in this research space?

06:38  Richard Alm
Overall, I mean, developing a drug in any therapeutic area is expensive. Developing an antibacterial drug as a therapeutic is equally as expensive, but it’s got some unique challenges to it. One is that you can spend all this time and, you know, estimates are up to $1.3 billion to get a drug from, you know, a compound from the start all the way through to registration. You spend all this money, you know, developing a drug through face to face through clinical trials. And then at the end of it, if it’s approved, the doctors and the regulators say that’s really good. But then the doctors say, well, we want to keep that until we really need it. And so then there’s no revenue for it. And so you spend all this money developing this drug and then it’s put on the shelf until the doctors really need it. And so there’s no income. I think some of the other challenges are when you do the clinical trials, most clinical trials are done as a noninferiority. And so you go against, you know, the standard of care or best available therapy. And so you’re looking for a noninferior. So, you know, worse than that. And so you actually don’t get a claim typically of superiority. And so then the perception I think is, well, you know, I can take a $5 generic or I can take your branded drug, why wouldn’t I take the $5 generic? And so I think the non-inferiority status of how you develop a drug is challenging. And I think then the third dagger, if you like, is that most antibiotics are only taken for 7 to 10 days typically because then the infection is either cleared or the patient has succumbed. And so you don’t have that lifelong your return visits, if you like, if you like, if you’re on a cholesterol or blood pressure medication, you have repeat you have the repeat customer usage concept, whereas with antibacterials you don’t even though a good antibacterial can extend your life by, you know, up to seven years, if you get an infection, a bad infection as a child that’s usually done in the first 7 to 10 days. And then you don’t think about it again. So I think all those challenges together make the profit margins very, very difficult, which is why a lot of countries and I know Australia is also looking at this and looking at pull incentives as well as push incentives. And so CARB-X is an example of a push incentive where governments are giving money and organizations are giving money to increase the amount of pre-clinical work that is ongoing to make sure that there’s a pipeline of products that can be developed and are innovative enough to get around the emerging resistance. But then there’s also a need to fix the other end. And that is, you know, big company, you know, you need big companies to or some big organizations to actually develop the drugs through the expensive phase two and phase three trials and then commercialize them. And I think the way to do that is some sort of reimbursement or, you know, pull incentive. And so different ones are being trialed. And I know Australia is looking at some of the different options there as well, which is great. I think Sweden and the UK have got pilots going and hopefully the PASTEUR Act in in the US will get approved by Congress and that will, you know, put in some sort of strength to the ecosystem so that companies will come back and reinvest in the development of antibacterials because I think they need needed.

10:00  Caroline Duell
CARB-X is an accelerator. Can you tell us how that model works in this marketplace?

10:05  Richard Alm
I’ve never seen a funding model quite like this. So we as in CARB-X, it’s a competitive grant based organization. So we when we have a funding round, the fund has set a size and scope of the funding round. And then we call for applications from all around the world. And it’s a competitive application process. To give you an idea, since 2016, we’ve had I think 1163 applications and funded 90 to 92 projects. So that’s around 8% or something. So it’s quite difficult. I think the good thing that I’m actually proud of at CARB-X, is that even if programs get through to the later stages of the application and don’t get funded, we still provide them with expert feedback from our you know, suite of advisors to help them improve their project. So even if they don’t get funded, they still get, you know, really good feedback on, you know, this is not only what would have helped you in this application, but this is what would help you in your project going forward. So hopefully they can still take that project forward and reapply. And we have had companies come back, reapply and then get funded. So that sort of supports that that notion works. So then once a company is contracted with us, we set up a series of negotiation rounds where we will negotiate a statement of work and we build a what we call a support team around them. Some of the companies we fund, a lot of them are very small, you know, less than ten people, some of them. And so they don’t have all of the expertise and all of the disciplines that they need to take a, you know, compound from hit to lead through to phase one. They don’t have the clinical or the regulatory expertise. And so what CARB-X has done is assembled a panel, if you like, a group of experts in the different areas that we fund. And we will bring those experts to bear. And they will sit on these support teams and work with the companies on a regular basis to add that scientific support around them. So we obviously give them non-dilutive funding, but we also give them a lot of, you know, technical and business development expertise as well as they try and build their company.

12:28  Caroline Duell
I understand, is over $300 million of funding invested into these projects that you’re working with at the moment. That’s a huge boost to the sector all around the world. It takes a lot of money to get an early stage project or a startup company, you know, sort of phase one, really. How much investment is required for these projects?

12:55  Richard Alm
Yes, that’s an interesting question about how much it costs. And obviously, there are some nuances there. CARB-X funds, therapeutics, preventatives and diagnostics. So depending on what pillar you’re of, that of what modality you’re in will have different costs. And also depends where you start. I will also say that, you know, some of the modalities we support like bacteriophages don’t have to do as much toxicology as a small molecule. And so those costs aside, so there’ll be a range of costs. But I would say for your average therapeutic program, if you are if you’re if you’re a company or your organization has multiple assets where some of the infrastructure can be deployed and costed against, you know, different assets, probably 25 to 30 million would probably be the minimum to get you through to, you know, phase 1, first time in human evaluation involved is, that that will depend on how strong your pharmacology package is or whether you pick up any toxicological signals in preclinical studies that you need to then follow up and do you know, more rigorous, tough studies before you progress. But that’s about how much it costs.

14:08  Caroline Duell
You just mentioned phages, and I know this is an interesting area of research around bacterial resistance. Can you just sort of, I guess, explain why antibacterial resistance is such a challenge at the moment?

14:25  Richard Alm
I mean, people have been talking about antimicrobial bacterial resistance for a long time. I think what some of the most pivotal data has come out earlier this year where the large Gram study from IMPE was done actually looked at the burden of attributable mortality to just the resistant part of antimicrobial resistance not just not from bacteria infections but from the resistant infections. I think the numbers like globally, it was like 1.27 million people died due to that were directly attributable to resistant bacterial infections. If you look at those that are associated, you know, associated with bacterial infections, with resistant bacteria infections, the number is almost 5 million. And that’s what they couldn’t attribute it, but it was associated. And that’s the equivalent of, you know, like a jumbo jet crashing every 37 minutes or something, you know, for a year, which, you know, if that was happening, people would pay attention. And yet I think a lot of attention because unlike COVID, which was a very rapid pandemic and very acute antimicrobial drug resistance is a slower moving pandemic. And it’s coming. And a lot of the last resort drugs are now resistances against those. And it’s going to get to a stage, unfortunately, if we’re not careful where simple surgeries, you know, hip replacements, you know, things like that are going to suddenly become, you know, a death sentence. Because if you get an infection, there’ll be nothing to treat it. And so simple surgeries, cancer treatments, all of those things and all those procedures, where we take the presence of an antibiotic for granted, are someday going to become a challenge as the resistance gets worse. And I think as especially in the Gram-negative bacteria as some of the resistance mechanisms have become so widespread, people have either resorted to colistin, which is a very old nephrotoxic drug, that people are still working out how to dose appropriately. It doesn’t get to all body sites as a last resort because that’s the only thing that most things are sensitive to. And now there’s resistance to colistin that is circulating through several mechanisms. And so people have been going back to your question about bacteriophages, the use of bacteriophages has been around for quite a while, mostly in Eastern Europe. I think it’s been picked up again by Western countries. And there’s a lot of activity now about treatment of severe infections with bacteriophage or bacteriophage cocktails, either empirically or personalized, where they will take an individual patient’s infecting bacteria and screen it against panels of bacteriophage and say, this bacteriophage will kill your bacteria. So we’ll dose you with that. And there’s been, you know, a lot of individual case reports where that has been successful. And I think the choice that infectious disease doctors have now is do we do we continue with it on this patient by patient basis or is there potential to move bacteriophage therapy into more of an empiric treatment regimen where you can use a cocktail against a certain pathogen and give it empirically without having to screen against individual patients, you know, isolates. And so I think the field, the bacteriophage therapy field is still working out where best to place it. You know, do you do it in combination with antibiotics? What’s the cadence of dosing? And some of those questions, I think, need to be answered in a randomized clinical trial format where you can robustly ask those clinical research questions. It’s very hard to get those answers when you’re doing one patient at a time. And each patient is very, you know, different. And so there are companies now that are doing, you know, randomized trials with bacteriophage. And I think some of that data will be, you know, will be very useful in directing the field as to where exactly is the best place for these phages to fit into the armamentarium of the infectious disease doctor? I have no doubt they will. The question is, where will they be best deployed?

18:42  Caroline Duell
So there is so many efforts and levels of research involved in this challenge of tackling anti-bacterial resistance. And you are working with a number of these projects, do you feel like you’re really working against the clock here?

19:01  Richard Alm
I do. In many regards. It takes a long time to develop a drug. I think it can take years and then it you know, a project can fall over for reasons that you don’t even predict. I mean, most people think it’s either not going to work or it’s not going to be safe. But there are other reasons that you know, projects can fall over and some of them, unfortunately, aren’t even for science. Some of them are for business reasons. The company might pull out and then try and re-license the asset to someone else and you’ve got to then spend the time to try and, you know, package the data up and find a buyer. So there’s a lot of things that can happen and go wrong between starting a project and getting it even into phase one, which is where CARB-X funds into so as you see all these, you know, rising levels of resistance, you do feel like you’re racing against the clock because it’s only getting worse, it’s not going to get better. And stewardship and infection control that hospitals are putting in place are slowing it down. And they should, you know, continue those policies because they make a huge difference. But, you know, little things like educating the public when and how to take antibiotics is also really important. And that’s all part of stewardship to try and slow down because it is inevitable. Bacteria replicate really frequently. And so evolution takes over and resistance occurs.

20:31  Andrew Bowskill
So you mentioned that CARB-X is a supporter of early stage projects and you’re one of the only financial supporters of those projects. And I’m just wondering, and a lot of those projects, as you called out earlier as well, come from really small organizations or even researchers, and that is still within a medical research institute or in academia. How can they be sort of poached to in development and product development? And what sort of things do you look for in a project to support those researchers and those small companies?

21:11  Richard Alm
First of all, I shouldn’t underestimate the value of research that a lot of governments put in through their funding for basic research. Because basic research is vitally important. CARB-X is a little bit different in that we fund product development research. So we don’t fund basic research at all. And so when we look to fund a program, when the applications come in, we look for applications that have a vision of where they’re going and who, what patient population they want to treat and how they want to get there. And so I think one of the biggest shifts between a lot of academic groups and, you know, to do the basic research over to product development research is really that. And that would be my strongest advice would be if you want to pivot from, you know, from basic to applied research is really think about who do you want to treat and how are we going to treat them because those questions asked early help you frame and design your preclinical research such that you answer those key questions. I think a lot of academic groups and a lot of academic applications, we see that the basic science is there, but they have no idea how to apply that to a clinical development program. So certainly when we have funded academic groups, we have had a couple of grants in Australia with the University of Queensland and what we looked for there was the ability to take that basic science but also have a product development mindset to it. And we always look for, is there an exit strategy? So either the groups that we fund have to have an exit strategy. Is it to out-license the product to certain stage to a group that will continue to develop it, which means that the group that are doing the work initially have to have the mindset to do the right experiments and ask the right questions so that it’s attractive to be out licensed, or are they going to spin out a company and do they have the capacity and the business development expertise around them to do that? And in the case of the group at Queensland, obviously UniQuest has played a role in that in several examples and so that made their application, you know, stand out.

23:40  Andrew Bowskill
So if you are a researcher, if there’s a researcher listening to this and that in an MRI or in academia at the moment, would you think that there’s an advantage for them to spin out into a small company? And if so or not, what do you think are the key attributes of a successful spin out?

24:06  Richard Alm
I think the most successful thing you can get with a small company is the people. I think having worked in both large and small organizations, the smaller the organization, the more important the people are and the way the people interact with each other. And if you’ve got a company of thousands, you interact with your small teams, but not necessarily with everyone in the company. When you’ve got a small company, you interact with everyone. And so that that dynamic and that culture is really, really important. From a scientific standpoint I think if an academic researcher at an MRI as is looking to say, spin out a company, I think they obviously need to get a story down of how their program, their product or future product is going to impact, you know, the health systems and the patients because they’re going to have to go and pitch that and raise money and raising money in this space is is difficult. CARB-X works on a cost share basis so our grants at the moment, some of the existing grants are at a 90/10 contribution. So we’ve been CARB-X has been supplying 90% of preclinical research to 10% cost share from the companies. I think the funders have now moved that to 70/30, which is where it was before COVID. But I mean that’s still a huge boost to them to get 70% non-dilutive money. But you can still have to raise those other funds. And so you have to have a story that you can go out and speak to investors and convince them that your vision is worth them investing in. And a lot of the well, most of the, you know, VC firms that have extremely good due diligence and they know the systems and the ecosystem that they want to invest in. And so you have to have a clear vision and a clear path to get there to warrant these people putting in their money because they want a return on their investment. So I think clear strategy, start with the patient in mind because that’s ultimately where you’re going to get because the VCs are not going to fund basic research, they’re going to fund they want to get to an inflection point where the product can be further developed or or sold off and they can, you know, recoup money on their investment. And so you have to have a clear path towards commercialization.

26:42  Andrew Bowskill
CARB-X has a global accelerator network with various organizations around the world. I was wondering if you could please tell us a bit more about that network and how it works and what those accelerators provide?

26:56  Richard Alm
Yeah, so we have, we have I think now we have six or seven accelerators, some of them are very, very like specialized. Like we have one fund, the foundation for innovative new diagnostics that helps our diagnostics portfolio. And that’s all they do. They do diagnostics. And then we have say C-CAMP in India, which they are an accelerator that goes out in the ecosystem within India and actually sort of encourages and draws out some of the science that is going on in some of the institutes in India and makes them aware of CARB-X. And I will say that since C-CAMP came on board the quality and the number of applications in our funding rounds from Indian institutions has grown dramatically, both in number and in quality. And so I think having an accelerator in a region where, you know, this is what CARB-X is looking for, this is how you can make a competitive application. This is, you know, and coach those groups, especially that are coming out of academia, how to make compelling applications is a key role of a pre award accelerator. The other aspect where we use the accelerators is post award. Some of the accelerators have specific technical expertise that will you know, bring into these support teams. Some of them have good access to regulatory, you know, regulatory agencies in Europe and so they can help if your plan is to, you know, to go in and file in Europe, they can help set up and facilitate interactions with European regulators. And so beyond the you know, once you’ve been awarded a CARB-X grant, these accelerators can also help accelerate, hence the name, but then can also, you know, help further the progress of your program by bringing in expertise and opening up doors and facilitating interactions where a small company might find it difficult. And the accelerators can do that. And so I think of the accelerators as two halves, the ones that help potential applicants frame a better story to get funding, but then also support companies in their portfolio, in the CARB-X portfolio that have been funded. How they can accelerate that by opening doors and creating networks beyond that and both play an important role to make sure there’s a robust pipeline both in the ecosystem as a whole, but in the CARB-X portfolio. Yeah. Specifically.

29:40  Andrew Bowskill
Right. And so and currently there’s no AMR accelerator in Australia nor for that matter in the Western Pacific region. And so you’re aware of the work that AAMRNET has been doing while we’ve been exploring how we could establish AAMRNET as the AMR accelerator here. So it’s the sorts of things that we’ve been doing is engaging internationally, raising awareness about Australia’s capability and capacity and building on its reputation as a single contact point for AMR R&D here in Australia. And we’ve also collaborated with therapeutic innovation Australia on their pipeline accelerator voucher scheme. And thank you for your input and being part of that assessment process on that one. So we just announced the awardees yesterday I think along with TIS. So that’s really exciting. And we’ve also been working with the same team that you support at University of Queensland to hopefully bring the ICARe antimicrobial drug development course to Australia next year, hopefully. And what do you see as the next steps for AAMRNET to get established as Australia’s AMR accelerator and possibly be integrated into the CARB-X global network?

30:56  Richard Alm
So upfront, I mean I’ll say that CARB-X would love to have an accelerator in Australia supporting obviously the Australian ecosystem, but also, you know, the Western Pacific as well because I think there are things going on in New Zealand that we don’t hear about. So I do think an accelerator in this area, you know, geographically this area would be, you know, exceptionally beneficial both to us at CARB-X, but also to the, you know, the greater ecosystem within Australia. And we have two accelerators in our network, the DCIF in Germany as well as C-CAMP in India that are funded from local governments. I mean, I think it would be it would make sense for the Australian Government to understand and recognize the risks that AMR play for the Australian population and see the development of an accelerator as a real investment, not just to develop and encourage and formalize some of the AMR research that’s going on in Australia. And I will say that even in my short time back here a couple of times this year, I wasn’t aware of how much AMR research was going on in Australia. So it’s really pleasing to see and I’m in the AMR field and so for me to see how much there is here that I didn’t know about that needs to get exposed to the world. I mean Australia has, you know, a very good history of doing, you know, good medicinal research and to get that out in such a valuable field as AMR is important. And I think an accelerator would help do that and raise it to an international stage. From a CARB-X perspective, obviously having an accelerator here to understand what CARB-X is looking for, each of our funding rounds and knowing who to contact in all the different research centers and supporting them to put in applications. I mean, the CARB-X grants are fairly large. I think, you know, most of them are on our website, so I won’t put the numbers up, but people can go and look. I mean, but they are significant. And to be honest, even if the development of an accelerator, you know, got one or two of these research grants into Australian, you know, scientific research, that would be more than the cost of funding an accelerator for a decade. So from that point of view, it would be money well spent for the government to step up and put in money to establish a, you know, a bona fide accelerator. And I think the other benefit, you know, just talking now specifically within the CARB-X sphere, a lot of our companies, as you mentioned in the beginning, Bug Works is doing their phase one in Australia. Australia has a reputation for having phase one units that are very good and we’ve had several of our companies within the CARB-X portfolio come and do their trials in Australia, but that’s in the Post Award accelerator. That’s where, you know, if companies are now progressing towards that stage, the connections could be made and the benefits could be directly applied to those companies from members of an accelerator, and that would only help the ecosystem within the clinical research arms of Australia as well. So I think there are multiple benefits of having an accelerator. I think somehow to harness all of the work that’s going on. Australia’s a big country. I think. But there’s, you know, there’s stuff, there’s a lot of stuff going on over in Perth from Brisbane down to Victoria. I mean that’s a lot of geographical area to cover to try and harness all that knowledge and all that, you know, in a central facility, if you like, or a central part of knowledge would be very, very useful, not just for CARB-X grants, but there are other granting bodies, less demand non-dilutive, but there are other, you know, international granting bodies that will, you know, give grants as well. And so it wouldn’t have to you know, it wouldn’t obviously be tied just to supporting CARB-X. It would be able to help these groups get funding from, you know, a lot of other sources as well. But all I can say is we would love to welcome an Australian accelerator into our stable.

35:08  Andrew Bowskill
So great news. Thank you.

35:11  Caroline Duell
You mentioned companies coming to Australia to run their early clinical trials. Why is Australia such a good destination for this type of clinical trial program?

35:25  Richard Alm
Few reasons come to mind. One is obviously, I think the quality of the data that comes out and the access to, you know, rapid assembly of cohorts and then, you know, robust data is obviously what companies look for in terms of their timelines if companies are also fighting against the clock because, you know, the burn rate of finances for small companies is quite quick. So the quicker you can do a clinical trial and not have it drag on, the quicker you get your data. And to be honest, the end of phase one is a very good inflection point for infection companies because you’ve got that preclinical pharmacology, you’ve now got human exposure. If you’re above the know how, you can work out a therapeutic index. And then that’s a really good inflection point to then try and get additional funding to do phase two and three. So I think speed and quality of data is one. The Australian Government also gives a, you know, a tax incentive rebate, which I think a lot of companies, especially the smaller companies, find very attractive. I mean I hear even working in the US, the Australian, you know, phase one companies will do little webcasts and webinars over their advertising themselves. So it’s not just in the therapeutic area of infectious diseases, it’s, you know, it’s a lot of different therapy areas that companies are coming to Australia to do. The early clinical research.

36:47  Andrew Bowskill
You mentioned the CARB-X has supported a couple of projects in Australia already. You talked about the gang at UQIMB and Bug Works have set up an Adelaide’s. There’s also SpeeDx in Sydney. What do you think that Australia and Australian researchers can do to be even more successful when it comes to accessing CARB-X or any other international funding for that matter?

37:15  Richard Alm
So projects that we have funded here, I’ll take SpeeDx to start with. I mean their platform technology is excellent. You know, the program we’re funding is a gonorrhea and chlamydia diagnostic that also picks up resistance very quickly. Obviously the point of care diagnostics for STIs is really important just because of the patient population, you need that out so very quickly. Their technology was quite impressive and they had a path on how to turn their assay platform technology with another partner into a product. The Queensland group had a program when they first came to us that was looking at a product that could kill colistin resistant bacteria. We spoke about colistin earlier as colistin resistance is increasing in the Gram-negative bacteria, something that could kill colistin resistant bacteria is obviously really important because that resistance is only with the amount of usage that colistin is getting now, that resistance is going to spread. They also came in with a very unique proposal around low and low- and middle- income country capability building, which one of our funders, GAMRIF, which is the UK government arm of our funding, is particularly interested in in LMIC or low- and middle-income country applications. And so they fund studies or portions of programs that are directly applicable to LMICs. And so the Queensland group came in with a very unique way of trying to build capability built in, in some of the LMICs. And the UK Government liked that proposal and that was, that was their second, their second grant was to work around how you could use some of their molecules as potentially agents against colistin resistant bacteria with widely available drugs that are already on the market in LMICs and potentiate. So you can repurpose those and reuse them and make them active again. But also with that, they tied in some capability building to help the LMICs researchers understand their problem and how to do molecular epidemiology on site. And that’s now I think if you help but rather than do things for groups like that if you teach them how to do it and they can do it themselves, that brings a lot more value to the whole world really. And so there are two very different programs that we funded here in Australia. When the funders of CARB-X set the scope of the funding around, it’s fairly narrow and will be hopefully announcing our new funding round soon. You know, read those and then I would encourage people within Australia to if you have a program that fits that, you know, reach out to some of the companies within Australia or within the CARB-X portfolio and say, you know, what is it like? We have companies that learn from each other, we have company only webinars, meetings where we will bring out companies together so they can learn from each other. And so that’s a different type of network. But we’re all in this together. And ultimately, as even when I work for AstraZeneca, if your child or your mother gets sick, you don’t really care which company has made the drug that saves their life. I think we owe it to ourselves as a society to make sure that, you know, we help each other be successful. And I think especially in an area where such devastating infections can take the life of someone, we need to help each other. And so, you know, one other thing that we’ve been doing at CARB-X just in the last couple of years, we call them portfolio acceleration tools. If we see several companies dealing with the same issue, we bet we will actually sponsor an activity that brings in data that we can share with those companies, but also to the greater ecosystem. Because, you know, that’s part of what CARB-X is about, is making sure that patients get access to drugs. And if we support the companies that develop them or we support the ecosystem that can develop them outside of our funding, that’s equally important to society. You know, help get off my soapbox now. But I think that that’s really important. And too often companies like don’t share data and then, you know, it’s seen as a competitive advantage if another company has to spend years and years to, you know, go down the same path to find out that, you know, that’s a toxic molecule that’s going to cardiovascular toxic problem or whatever. Whereas we talked about earlier, we’re racing against the clock here. And if you can shave off a couple of years by sharing some data, publishing it, talking to people that are in the same field, you know, I think the time for that level of competitiveness in this field is gone. I think we need to work together. And so I would encourage any applicants in Australia to, you know, speak to the Queensland group or whatever and find out, you know, what they thought CARB-X, what, you know, what they put into their applications and yeah, come to us with the best app application you can generate with this is the patient population we want to treat and this is how we’re going to treat them. This is our vision.

43:07  Andrew Bowskill
It’s a really important point, I think. Yeah. I mean, collaboration is the key, certainly MTPConnect, we stand up there and say, you got to collaborate, you’re going to collaborate, right. And that the whole message of what are we doing this for in the first place? And that’s to ensure patients have access to the right.

43:27  Richard Alm
And I think that shouldn’t be forgotten. There’s the old saying it takes a village to raise a child? I think that’s where AMR research is now. And there’s so many big companies that got out of it. You know, so many little companies are doing the lion’s share of the work now. And they all would benefit from the knowledge. And, you know, the other thing with the big companies leaving the space is that you’re losing a lot of that institutional knowledge. And you mentioned, you know, the eyecare costs that you’re hoping to bring down here next year. I mean, I think part of that is to train the next generation of antimicrobial drug discoveries, because, you know, when old people like me stop, you know, if there’s no one to teach the next generation, then that’s going to have to be relearned. And unfortunately, we don’t have time to relearn how to make, you know, good antimicrobial drugs. And so the continuity of institutional knowledge of how to do it needs to be passed on.

44:31  Andrew Bowskill
And it’s a good segue to the next question, actually. It’s about young people and how can we get more young Australians involved in raising awareness around AMR?

44:44  Richard Alm
So interesting question said you mean young researchers so they research it or just young people in general to be aware of the risks of AMR?

44:55  Andrew Bowskill
I think that everyone needs to be more aware of the threat that AMR poses and in the future. I mean, if we’re running out of antibiotics and to think that someone can’t get chemotherapy or a hip replacement or whatever is, is just incredibly frightening to bear if you stop and think about it. But so yeah. So but yeah, I mean, obviously we need young researchers to get involved as well to try and overcome this. And it’s a village, as you say.

45:30  Richard Alm
I think in terms of general population, I think one of the most important things is the precision of communication. I think COVID has taught us that, you know, populations as a whole can understand scientific principles if they’re communicated fairly clearly. And, you know, unfortunately, COVID has been there’s been good examples and bad examples of that, of how to communicate. But I think if you ignore the bad examples and some of them were quite bad, there were several really good examples of how to talk to the global population, you know, within your country of this is what an infectious disease is, these are the risks, this is how to help. And I think that precision of communication, honest and transparent, is the best way to go. And I think that more and more drug resistant bacteria need to be included in that conversation just at a population level. I think the challenge there is, because it is unlike COVID, it doesn’t affect you so acutely. It’s easy to ignore and, you know, kick the can down the road and, you know, let the next administration worry about it because it’s not our problem. And so I think in terms of the general population, it’s all about you don’t need to put fear into it, but I think you need to be realistic and honest and precise in your communications. That’s for the general population. I think in terms of, you know, if there are researchers going on and you know, where they can choose their career, I mean, microbiology, I’m biased but microbiology is, I think, a fascinating career, working with things you can’t see and watching them evolve and change and adapt basically in real time is is fascinating. And so I think what I’d like to see, you know, some universities I know some are doing this and I applaud them for it is to blend that basic lecture series of microbiology into biotechnology. And how can you turn that basic knowledge into, you know, translate that into medical research? I think the more that you can, you know, not just go to the textbooks and say, learn this remotely, you know, and just, you know, memorize this, memorize this, but actually take that information and translate it and run biotechnology courses or bioengineering or whatever to show students at an early part of their career, maybe as a, you know, undergraduates as to this is how what you’re learning today can be applied, I think gives them a lot of focus and a lot of, you know, excitement about how they could make an impact. And so if you can encourage undergraduates to see how, you know, basic textbooks can really be translated into products, can help the population they will develop technologies that we can’t even think of yet. And so but they need to early on, I mean, when I went through undergraduate, it was, you know, you just learn about bacteria and that was it. It was only really when I ended my postdoc that I was lucky enough to get into industry and see how it’s not just your single discipline. I mean, all through my academic training, it was really just molecular microbiology and that was it. It was only when, you know, you get to a company and you see all these other disciplines, you know, the pharmacology and the biochemistry and the toxicology and how they can all come together and work together. And you have experts from all these different disciplines sitting in the room working on the same problem. Again, it comes back to that collaboration. You all have that singular focus of what can I do with my specific expertise to make this product move forward safely and effectively. That level of broadness in undergraduate would have been a huge advantage to me, rather than taking, you know, six or seven years to come across it. You know, I think for universities or early researchers now, students to get exposure to how other disciplines play a role and what you want to do and how you want to apply I think is important.

49:52  Andrew Bowskill
It’s exciting to think what’s possible in the future, that’s for sure. It really is as scary as AMR is and it’s exciting to think what solutions we can come up with, the new generation can come up with as well. So we can’t talk about anything and we have already a little bit without bringing up the impact of COVID 19 and how the pandemic tested our responsiveness and preparedness around the world to tackle a global crisis in a short term. How do you think the world is currently set to fight against AMR and how can we in Australia be more involved in the global effort?

50:29  Richard Alm
I mean watching it, it was surreal in the States for two years watching COVID evolve because as a microbiologist slash virologist, there was nothing that happened that was surprising. I mean, it was the spread of a, you know, respiratory viruses. It can’t be stopped. And so, you know, I think the speed at which some of the treatments and vaccines came online was breathtaking. Knowing how long it takes to develop those normally. And, you know, I’ve heard people say, well, why did it happen so quickly? It wasn’t done robustly, which is frankly completely untrue. I think one of the biggest things was that because there was money given to the companies that were developing it, you could run trials in parallel without waiting for that, you know. Do I reinvest? Look, let me look at the data. Do I reinvest? Because the money was there? You could do things much faster, which, you know, I’m not saying that that will happen in every case in the AMR, but certainly the availability of funds drives innovation. There’s no question about that. We saw that with COVID. I think as horrific as COVID has been, I think it’s also taught us about preparedness and hopefully put the world on notice that, you know, some of these things, you know, are going to happen again. And how do we prepare, I think with all the molecular testing capability that’s now been deployed around the world to low and middle income countries and to, you know, all different regional centers, I think to have that capacity now to pivot that towards AMR detection and AMR diagnostics would be incredibly useful for both from a surveillance as well as a, you know, just a diagnosis standpoint, but also from a surveillance aspect. If some of that molecular technology that testing can be pivoted towards AMR would be tremendously useful. So I’m hoping that that happens. I think, you know, Australia did really well early on in COVID. I mean I was obviously because my family’s here, I was watching it, I was really impressed at how coordinated Australia was compared to, you know, what was going on in the US at the time, which was, you know, not as coordinated. At some point you get that, you know, that pull of well at which point do you open up again? And I think every country struggled with that. But overall, I think the organization of Australia during COVID was exceptional. I mean, when you come in, you have the sign in QR codes and the contact tracing and the earlier, there was nothing of that in the States. And so, you know, Australia should be really proud I think, of how they handled it and you know, early on and set up those things. In terms of AMR pivoting to that, I think as I said earlier, there is a lot of AMR research going on in Australia. I think having that coordinated and put together to help, not just locally, you know, within Australia but also globally because we do live in a global world. I think that’s one thing COVID has definitely taught us is we’re all so interconnected that it’s not a one country problem. And I don’t think AMR is either. But I do think that the government needs to understand that access, all governments, not just the Australian Government, that access to good antimicrobials is what’s going to prevent an outbreak. And so if you have an outbreak and you don’t have a good antimicrobial, you may not be able to. I mean, the vaccines and stuff came for COVID in, you know, in 12 months they repurposed some antivirals very quickly. I don’t know whether if you had a drug resistant bacterial outbreak that was that widespread, that you could repurpose another drug because they’re already resistant to it. And so I think understanding that you need a consistent pipeline is one of the hardest things it seems to for people to comprehend that you have to prepare years in advance and you need that. You can’t just say, okay, there’s, you know, there’s 20 products in phase one to phase three now that are moving through. If we get three or four drugs out of that will be good because those drugs will you get resistance to those drugs fairly easily. And if you’ve got nothing to replace them, it takes it takes a decade to build that pipeline. And so that’s where CARB-X is really focused, is trying to make sure that there is a sustainable pipeline there with things going into clinical development on a regular basis so that we’re never caught out. And so I think the governments of the world to realize that having a pipeline is what’s important and not just, you know, a drug on the shelf today.

55:38  Andrew Bowskill
It’s a really interesting and unique challenge that AMR sort of poses for the world.

55:45  Caroline Duell
So, Richard, what’s next for CARB-X, given your newly announced funding? What’s the horizon looking like now?

55:51  Richard Alm
Yeah, so we were really proud to get to get the new BARDA Award, which was announced July 1st. I think that was $300 million commitment over ten years, which, you know, I think shows their commitment, you know, to a longer term horizon and Wellcome, which was our another one of our original funders. They came in with more funds as well. I think very shortly within the next few months, hopefully we’ll announce how the scope of our new funding rounds and then we start again with the applications. Some of the discussions we’ve had internally already is, where are the gaps in, you know, in the, the global portfolio as well as our portfolio? What, where are the real gaps? And I think anyone that follows this space can look fairly quickly and say, well, it would be good to have more oral drugs. I think a lot of the drugs are IV based. I think some of the oral drugs that are used commonly, the resistance is getting so high to those that they’re becoming less and less useful. And so to have some good oral drugs for some indications, especially for indications that could be treated out of the hospital. At the moment, if you get a drug-resistant bacteria, even for something as simple as a urinary tract infection, you have to go into hospital to get an I.V. drug. And because there is no oral alternative. And so then you’re now paying hospital costs and the burden on the health care system, you know, at a time when the bed may be better used for someone else, you’ve got someone in there with imminently what would be a treatable outpatient infection if you had an appropriate oral drug. And so I think, you know, there’s an area that I think, you know, I’d like to see more and more attention paid to, you know, getting some oral drugs obviously that hard. I’m not saying they’re easy to develop, but there are things like that that I think hopefully will be, you know, the focus going forward of trying to fill some of the gaps that are in both our pipeline and in the global preclinical pipeline.

58:07  Caroline Duell
Well, we’ll be watching with interest. Richard, thank you so much for joining us today. It’s been a fascinating conversation with you about the challenges of antibacterial research and the work of CARB-X. It’s great to have you back in Australia for a little while and we look forward to staying in touch.

58:25  Richard Alm
Yeah, thank you so much. It’s been lovely.

Investment strategies in phage therapy

Host: Steven yang
Guest: Richard Alm, PhD, Chief Scientific Officer, CARB-X

00:12  Steven Yang
Now we know phage therapy is part of the bigger picture of antimicrobial efforts, especially at dealing with the growing threat from antibiotic resistant bacteria. From an investor perspective, to make the right bet, it’s important to have a more comprehensive understanding of the big picture and be able to compare phage therapy horizontally through the other products on the market. I’m Steven Yang, and this is phage therapy today. We’re honored to have Dr. Richard Alm with us on the show today. After his PhD at the University of Adelaide and his post-doctoral work at the University of Victoria and University of Queensland, Dr. Alm served in R&D, a management position at AstraZeneca for 20 years before he became the vice president at Macrolide Pharmaceuticals, now known as Zikani Therapeutics until 2018. Starting in 2019 doctor who is currently the alliance director at CARB-X and a consultant to the World Health Organization. Dr. Alm, thanks for joining us today.

01:18  Richard Alm
Oh, you’re welcome. Nice to be here.

01:20  Steven Yang
Yeah, it’s great to have you here. So I must say, Doctor Alm, going through your career path over here, I feel like you definitely take a few harsh turns over here, both location wise, as well as the career pathway. So I guess I’m always interested, how does our guest, the formative years eventually get you where you are now? I guess also tell us about how you became interested in learning about phage therapy and also what does CARB-X do, what do you guys do over here?

01:54  Richard Alm
Yeah, of course. So, yeah, I mean, going back many years, my career, if you like, has taken a few turns. I had originally wanted to be a veterinary scientist, but growing up in the eighties in Australia, there were very limited options as to the number of universities that would actually teach that. And so for personal reasons, I had wanted to stay in Adelaide and so my dreams of becoming a veterinary surgeon got dashed. And so I found my love in microbiology and so I did my major, my undergraduate microbiology and then did both my honors and my PhD in microbial pathogenesis. And I was lucky enough, I think, during the last year of my PhD, to share a bench with a scientist that was on sabbatical from Canada, and he invited me back to his lab to do a postdoc in Canada. And so I of course accepted, had never left Australia and so came and went to the University of Victoria in British Columbia, which was beautiful. And I spent three years there, after which I went back to Australia, to Queensland to do another postdoctoral fellowship in Pseudomonas Pathogenesis. And during that time the professor that I had worked for in Canada had been getting research funding from Astra. It was before AstraZeneca and he got asked to set up a research satellite in Boston here. And so he called me back in Australia and said, “Will you come back to the United States and travel back across the ocean, work with me again?” And so I did. And my plan was obviously to only come for four or five years. And I’ve been here 23 or so, I’m still here. And so that became Astra, became AstraZeneca. And then unfortunately in 2015, AstraZeneca got out of infection like a lot of the large pharmaceutical companies have. I spent a few years at a small startup where I was involved with CARB-X from the recipient side. We had a CARB-X grant that I was PI on, and then when that company pivoted and got out of anti-infectants again, I joined CARB-X and have been there for two and a half years. And when I joined there, there was one phage company that was in negotiation after having come in an early round, and that was Eligo Biosciences. They were in negotiation. There hadn’t been the contract hadn’t been announced yet, but they were that they were being negotiated. And so when I first started, we had a 2019 funding round, we called it. It was broken up into four parts. And I was responsible for the nontraditional. So the odds and ends that the island of misfit toys I called it, all the bits that didn’t fit into the vaccines or diagnostics or direct acting school molecules. Everything else got bundled into the nontraditional round and that included phage. And so we had I think we had 11 or 12 phage or phage related products supply, of which I think we have a three, a three tiered application stage. And I think six of them made it through to two longform and three of them eventually got funded. So now we have four phage companies in our portfolio. And I had used phage, you know, throughout my formative molecular biology years more as a tool in the lab. I did my Ph.D. on Vibrio cholera. There were the people in the lab that were there working on the first phage of vibrio cholera, that had been isolated from sewage and in low- and middle-income countries. We’re working on phage there, but I’ve never really considered phage as a therapeutic. I’d heard about it in Eastern Europe, but had never really experienced that. I’d rather use it as a molecular biology tool. So I was really excited to see the advancements that have been made in phage and how they had been used and their introduction into Western medicine. And I think that they hold a very unique and specific niche for treatment. We have in CARB-X now I’m pleased to say we have a couple of programs looking at treatment with phage and a couple looking at prevention of infection using phage. And so I think it’s a very exciting field that we’ll still as a community, I think, working out exactly where phage will fit with this, with their therapy. They’re obviously extremely flexible, as you know. And I think there’s many opportunities for how they can impact the treatment of infectious diseases.

06:39  Steven Yang
Wonderful. So I guess before we go into the details of these companies, tell our listeners about what kind of is it private funding, is it public funding CARB-X is.

06:50  Richard Alm
CARB-X was founded in 2016. It was a competitive application put in. The executive director is Kevin Outterson out of the Boston University School of Law. He had been in health policy for years, and he, together with a couple of colleagues, put in an application in response to a call from the federal government that was established under the Obama administration. The Presidential Action Committee Against Combating Antimicrobial-Resistant Bacteria, so PACCARB. And so that sort of was the foundation of CARB-X where the BARDA, which is part of the Health and Human Services Department of the US government, they had put money to form this accelerator to help fund pre-clinical projects in the space. And it was for therapeutics, preventatives and diagnostics and Kevin and his small team in the beginning went out and raised other money from other funders. And so in our first five years we’ve been funded by BARDA from the US Government, but also we have funding from the German and the British government, the UK government and also we have a lot of funding from the Wellcome Trust who were initial partner with BARDA and also from the Bill and Melinda Gates Foundation. And we also get in-kind services from NIAID, which is part of the NIH. And so our companies that we fund get access to the pre-clinical services on a streamlined basis through that offered through NIAID. And so it is, it’s a completely nonprofit. We do, we fund companies through a competitive application process. CARB-X doesn’t take any equity state, so all the funding is non-dilutive, which is good for the companies because I think the companies in this ecosystem struggle because of the economic challenges that selling antibiotics can cause, and it’s a reimbursement model. So it’s quite unique. So it currently for pre-clinical work, CARB-X will put in 90% of the cost and the companies put in 10%. And then as programs move into phase one, which is as far as we as we fund, it’s an 80/20 split where CARB-X would put in 80%. But I will say that it’s more than just the money. A lot of these smaller companies don’t have the broad personnel base within their company where they have expertise in all the disciplines and so every team, every company, the CARB-X funds has a team built around it where we will supply free of charge access to our consultant network. We have about 160 to 200 consultants on retainer that we can draw on across all the different disciplines to provide ad hoc both business and scientific support to these small companies as they progress their program through. And so it’s a very it’s not just, you know, here’s the funding good luck and leave the companies alone. There’s a lot of interaction. People like myself in the R&D team at CARB-X, we get to know our companies and our product developers very well. We work with them and we discuss with them on a monthly basis, sort of what areas they may need support in. And then it’s our job to then go out and try and find that support for them, to help them as much as we can progress their projects. And so it’s a true collaboration, very unique funding model, but a very good one.

10:36  Steven Yang
I think that’s definitely true because especially for those you mentioned, there are pre-clinical companies. So this early stage mentoring is definitely a very big thing. And also the way you fund it, I guess for biotech, you never have enough money.

10:53  Richard Alm
Yeah, true. I mean, I will say that the one thing that having worked for almost 20 years in a large pharma and seeing the unfortunate exit from large pharma of so many infection groups is where I’m nervous that the field is losing some of the institutional knowledge about how to do this type of research. And I think it’s important from an educational aspect to keep some of those people engaged, to try and teach the next generation of antibacterial drug companies.

11:26  Steven Yang
Elaborate a little bit on that.

11:28  Richard Alm
Yeah. So I know that when AstraZeneca got out of the infection space, there were scientists there that had spent 30 years like chemists that knew every class of antibacterial inside and out that had been worked on across the industry. And when they left and then when our infection group of AstraZeneca dissolved, a lot of people went off to other therapy areas. And that knowledge then is lost from the infection, antibacterial space. And so if those people don’t come back to infection, you lose that knowledge. And with so many large companies leaving and, you know, the infection therapeutic area, those people, if they either retire or they go into other therapy areas a lot, go to cancer or metabolic diseases, chemists that discipline knowledge is broad based. So they can go to other therapy areas quite easily. You lose that knowledge of the uniqueness of how to treat infections and how to make molecules that can actually cure bacteria. Because a lot of that, a lot of the uniqueness of the drug discovery aspects in antibacterial research is unique to the bacterial space and so very different to making compounds and drugs for other therapeutic areas, both in terms of the amount of compound that you need to make. So even the process of chemistry is more challenging. Early on, you might have to make kg and kg early on. So you have to start your process chemistry early formulation is challenging because your doses are so high with small molecules. And so there’s a lot of unique challenges in infection that if people that have worked on that leave retired, go to go to another therapeutic area. There’s no training of the younger generation to pick that up and continue to develop it and make progress in the field. Very useful to make sure there’s that continuity of knowledge.

13:35  Steven Yang
Definitely. Yeah. What is a background of all these all the big pharma is leaving the antimicrobial space?

13:43  Richard Alm
You mean why did they get why did they get out?

13:45  Steven Yang
Right.

13:46  Richard Alm
Yeah, that’s a good question. I mean, ultimately the economics of antibacterials are challenging because unlike, you know, heart medicine or, you know, things that you take every day for years and years, antibiotics, antibacterial drugs are used on a very acute short-term basis, you know, really, you know, 10 to 14 days. There’s a few indications where you give them a bit more chronically, but typically they use very acutely. And so that’s one of the challenges. You don’t sell a long, you don’t get a patient for life. You get them for 10 to 14 days. So that’s one challenge. The other challenge is that you spend all this time making a good drug, let’s say, that is active against some of the resistant bacteria. And as soon as you launch it in, the nature is to say, okay, we’re going to leave that until we really need it. And so then they put it on the shelf until you really need that drug. And so then you don’t sell it anyway so that you spend all this time and effort and resource making this drug, and then it gets put on the shelf for that last, you know, last resort antibiotic and it doesn’t get used. So therefore you don’t have the sales. And then the third pillar, if you like, of challenges that a lot of drug sensitive bacteria that cause infections can be treated with generic drugs, which are very cheap. And so inherently people are nervous to use expensive antibiotics when the cheap ones may work a good percentage of the time. And so they now typically try and go to the generic ones first, especially in the hospital situations where all the reimbursements in the US are bundled. And so you basically get reimbursed by the indication as the drugs are used. And so if it’s treatment within a hospital, financially it’s better for the hospital room to use the cheaper drug rather than the expensive drug because they only get paid a certain amount per infection, if you like. And so I think you put all those three together. It’s a very challenging business model. And the times of antibacterial drugs being blockbusters and selling, you know, half a billion to a billion dollars a year of sales are pretty much gone. I think there’s probably only one drug now that is even close to that in yearly sales. And so I think the large companies in the you know, their in their business, they need to show profit to their shareholders. They moved on to they wanted to focus in on different therapeutic areas and infection is one that’s not going to give them the biggest return on investment compared to some of the cancers and stuff.

16:35  Steven Yang
So you’re right, they left the space for smaller companies and also more innovative ways for treatment and sturdy set up the model kind of what is now working for them.

16:48  Richard Alm
And I think that’s what you see now. I mean, I think that if you look at the preclinical pipeline now, it is 80% small and medium sized companies and by small companies I mean less than ten people. I mean there’s a lot of very small micro companies that basically do most of their research through CROs and then and that’s there, they don’t have to pay a lot of salaries because they usually only have one, maybe two assets. And so they go through CROs and they try and move programs through that way. And I think that’s where CARB-X has really been able to help the ecosystem to come in and help those. But you’re right, in terms of the innovation, I think what we’ve seen in the last four or five years is, you know, some of the some of the recent publications that have come out have shown that the preclinical pipeline up to, you know, testing in humans, approximately half of the antibacterial pipeline is now directed against single pathogens. You know, both the CDC and the World Health Organization put out their threats list of their priority pathogens list, you know, against these are the pathogens that that most work should be done on because these are the most challenging bacteria. And researchers have focused on that. And then looked at ways to kill just those specific bacteria. And I think that has led to a lot of nontraditional approaches. And, you know, I mentioned earlier in the podcast about the CARB-X funding round in, you know, when I first joined CARB-X and there were four funding rounds in 2019 and the nontraditional was actually by far the largest in terms of the numbers of applications and the numbers of awarded grants, because there’s a huge amount of diverse and innovative science that’s going on out there. And these small companies working in this nontraditional space have these ideas, but they don’t have the financial resources to try and prosecute those ideas. And I think that’s where push mechanisms like CARB-X are very valuable because it helps develop that science, not just for that particular group, but also for the entire ecosystem. Because everyone learns if you do a certain aspect of science and then you publish it, the whole field learns. And I think that we encourage all our developers to publish their research and talk about it as much as they can, because I think it moves the whole field forward and that’s what we’re going to do as a society.

19:40  Steven Yang
That’s a very big picture you just painted. I know  you mentioned this once or twice. It’s about how some different pathogenically, some of them are more sensitive already to the existing drug, but some of them maybe are some rare pathogen, maybe they’re antibiotic resistance, and where we see phage in this picture?

20:01  Richard Alm
Yeah. So I think there is a growing antibiotic resistance trend. And I think that’s the slow moving tsunami, if you like, of fear among people. You know, that that are in this space because the resistance, the percentage of resistant bacteria are growing. And the more they the higher the percentage of resistant bacteria, the harder they are and the more recalcitrant the treatment options are, because they just they don’t work. And I think that’s where you’ve seen phage therapy sort of grow in the United States, mainly at the moment through emergency use and compassionate use, where patients have been completely untreatable, their infections have been untreatable with multiple different antibiotics that have been tried because the bacteria that’s causing the infection are resistant to all of these drugs. And so as a last resort, people have been using phage therapy. And, you know, the challenge with that is, you know, in many cases, that is a success that that and then a successful treatment, I think, which gives people a lot of confidence that phages can play a really important role in the treatment of MDR infections, multidrug resistant bacterial infections. I think the challenge from a regulatory and a clinical perspective is when you treat a single patient, usually a very vulnerable patient at the, you know, in serious medical need with an underlying infection and you treat them with phage. It’s a one-off customized treatment. And so that treatment has never been evaluated in a randomized clinical trial to understand how to use phage most appropriately in the clinic as an even as an empiric therapy. And so I think as phage therapy graduates and becomes more mainstream and matures in its use, I think what is needed is clinical trial and some of them are ongoing now, which is great to see is randomized clinical trials where you are evaluating key clinical parameters with phage in a controlled fashion in a clinical trial. And I think that will give a broader acceptance to phage being used as a therapy or as a preventative, because it then will get regulatory approval as a broad product rather than a compassionate use product to this particular patient. And I think that’s what the next step the field needs to see. I mean, we’ve seen that clinical benefit, but a lot of those patients are very sick and some of them succumb to their infections. But you don’t know if they have succumbed to their infections because by the time they got the phage treatment, they were in such dire medical need that even the phage couldn’t help them. And so I think you need to understand you. We need to understand as a community where is the best place to position phage and where can they have the maximum benefit for the treatment of these infections? There’s no doubt that they will play a role. The question is finding that patient population or that indication where they can be most useful to the broadest number of patients.

23:43  Steven Yang
Right. So eventually it all goes back to the clinical data.

23:47  Richard Alm
Yeah. And I think the one thing about phage that I mean is everyone that’s worked with phage knows this, but it’s, it’s worth pointing out and that is phage are inherently really specific. They can be specific for a particular species, but also for a particular isolate within that species. And so a lot of these emergency use cases, you have to match the exact isolate that’s causing the infection in that particular patient with that sensitivity to a phage, I think as groups start to strategize and come up with ways to either make larger cocktails of phage so they can be used empirically, that will help cover the maybe the differences within a species of different strains. I think what is still one step beyond that is how can we quickly diagnose the causative agent of an infection so that we know which phage cocktail to give? And I think that’s where diagnostics are a really fast-growing area in infection. Typically, you know, if you go back, you know, years diagnostics was you played out the biological samples and two days later you get what bacteria it is and whether it’s sensitive. And by that time, it’s hard to give care if you’ve already treated the patient empirically until you know exactly what’s causing the infection. I think especially with patients that are extremely sick or extremely vulnerable, you need to have that answer quicker and if you’re going to use a very precise medicine like bacteriophage, then I think you need to know that with more confidence earlier in the treatment cycle so you can make sure you’re putting the right treatment on board. And if that happens to be a phage cocktail that you know that you are putting that the correct phage against the right species. And so I think the combination of the development of diagnostics, rapid diagnostics as well as these broader I’m calling them cocktails, but there could be other engineering aspects that broaden that host range of phage. I think that combined will take phage from treatment of a single patient where you’ve tested a susceptibility of that pathogen to your phage, to a broader, more empiric treatment paradigm where you can diagnose the patient and then treat them empirically with phage at the outset. And I think that will be the paradigm shift that we need in phage therapy.

26:24  Steven Yang
Right. And was that I guess, concern of your when you were making your company valuations in there?

26:30  Richard Alm
So CARB-X is so CARB-X thinks about it two different way. We I mean, we obviously fund diagnostic companies as well. And so we pay attention to with the emerging diagnostic technology platforms out there. And you know, the speed at which you can get the result I want we didn’t choose or not choose which phage companies to invest in based on whether there was a diagnostic available. I mean, I think that that wouldn’t have been the right thing to do. We chose our phage portfolio in the initial instance to capture the breadth of phage research that’s going on. As I said, we have two companies that are looking at using phage in a preventative mode, two that are looking in a therapeutic mode, very different patient populations, different indications and different stages of development. And so our goal at CARB-X was initially to when we stepped into the phage space was to say, let’s take a diversity of approaches and try and understand support these companies. We like this, we like their underlying science. Let’s support these companies. Hopefully get them to the point of evaluating the products enough so maybe we can inform our funders, but also inform the ecosystem what the best direction of travel for phage therapy is. Is there a niche or is it going to be every indication will work with phage if you get the right phage, the right formulation and the right administration, it’ll always work. Or are there specific patient populations where phage is going to be superior to anything else? And so I think rather than putting all our investment into one particular and making out, we knew the answer to that question straight away. We wanted to invest more broadly and try to use our investment to try and advance the field to understand where phage therapy could be most useful.

28:48  Steven Yang
Right. Well, that’s leadership mindset here. Yeah.

28:52  Richard Alm
I can just thank our funders because they supported that.

28:55  Steven Yang
So yeah. So one aspect that is interesting to me is because looking at your phage portfolio, investing through a through a four, you mentioned none of them are phage therapy in the most traditional sense. They’re all using some kind of innovation like locus biosciences, of course. Like they’re trying to do different kind of engineering stuff directly using phage, using this virus specific bacteria to treat bacterial infections. And I’m just wondering, what’s the cost for that? Are you just looking for something that’s more innovative?

29:35  Richard Alm
So we, you mean like the CRISPR engineering?

00;29;40  Steven Yang
Right?

29:41  Richard Alm
Yeah. So there was some evidence that, you know, that locus, the locus had the CRISPR engineering. I mean, we have three CRISPR phage actually in the program, you know, in our programs, different CRISPR systems. But I think that there was some evidence that the use of CRISPR can also increase the speed of killing, which I think is important. I think we didn’t we didn’t certainly didn’t go into our investment saying we only wanted to invest in CRISPR phage. That wasn’t a high priority choice that we made. But I think as we looked at the programs that had the best data package when they applied because obviously the application process that CARB-X is the final stage is where they come in and they present that have submitted a large dossier of written information. But then they come in and present to an advisory board that’s objective outside of CARB-X. And we built an advisory board that had some experience in bacteriophage when they came and presented, it was really to holistically look at the data package and then deliberately try and say, okay, well this is where these different technologies differ. And then if we can’t decide which one is better, well then we should give both a chance to see. Let the data tell us which one is better and be data driven. And so we certainly didn’t go in so we were only going to fund engineered phage. I think that was just serendipity. But I will say that the different CRISPR systems bring different attributes. I think the you know, we have one program that uses phage purely as a non-replicated delivery device, which is a, you know, specific delivery of payload. You know, we have some that will replicate at the site of infection, which I think brings very unique pharmacodynamics and pharmacokinetics, if you like relationship because you’re actually making your product at the site of infection, which for a small molecule never happens. So I think the ability to actually produce more drug at the site of infection will change the way we have to model pharmacodynamic response.

32:21  Steven Yang
Yeah if we’re going to say if there’s something have in common about these companies that have been selected or be their data package will be a little bit more mature compared to the rest.

32:33  Richard Alm
Yeah. So we have well mature so, so certainly there’s a couple that are late stage and so their data package was more mature. There was a I think locus. If you pull them out specifically, their particular program that we’re funding was that it was in a slightly earlier stage but they as a company had had taken one of their products basically into man. So they had demonstrated their ability to take a product into a traditional, more traditional clinical trial. Yeah. So I think it’s a combination of the data package that they had already generated and they presented their underlying thesis as to what patient population they were going to try and treat. And I think people often ask me, what advice do you give to small companies as they’re, you know, developing a product and thinking of applying. And my usual answer is, look, you’ve got to start with the end in mind. Think about the patients you’re trying to treat, what is unique about them and what aspect of that infection do you need to make sure that you can address with your product being a bacteriophage or being, you know, a small molecule or being a vaccine or anything. Think about the patient population because ultimately that’s what’s going to drive the success of your product if you’re making your medicine. And so if you think about, you know, the first step, you have to have the end in mind. The journey may be very different, but the destination, you have to understand your destination. And so I think that certainly with the if you just thinking about out of the sub portfolio stage companies we certainly looked at the differences of indications that those these companies were targeting as well to say, okay, they understood the patient populations, they presented a good thesis as to how they feel that phage would be able to address those patient populations and had a road map of how they were going to, you know, prosecute that project. And so I think it’s a combination of stage of development, data package and vision for how to get to that, you know, to the final product.

35:05  Steven Yang

Great. That’s a very good perspective because I was going to ask you about I guess my original question was going to ask, how do you see the phage has more competitive advantage to compared to other antimicrobial products. But I guess kind of I feel like your answer is going to be it’s really not about competing with each other. It’s really about how each solution should be finding the right target, the right population for treatment.

35:36  Richard Alm
Yeah, that’s definitely part of it. And I think that’s true. I do think that the specificity of phage treatment, I think is also very attractive. You know, as long as we can couple up with high quality and high confidence diagnosis of what’s causing the infection I think over the years, you know, over the last 20 years, we’ve understood a lot more about the risks of broad spectrum killing of bacteria with, say, a small molecule because of the the damage it can do on your microbiome and the dysbiosis that it can cause. And then, you know, obviously the C difficile grow back and stuff. So I think that the precision of killing a bacteriophage is one of its or one of its strongest attributes that if you can go in and, you know, I hate to say surgically remove the pathogen that’s causing the infection and leave everything else untouched. That obviously from a patient perspective is the best outcome because you’re removing that. You know, the organism that’s causing the problem, but you’re leaving everything, everything else untouched so that it doesn’t cause dysbiosis or any other side effects. The question is, how well can we harness that with bacteriophage and, you know, harking back to the diagnosis but I think that knowing which patient populations you can remove enough of the bacteria to allow the patient to recover is also important. And so that’s where it comes to patient populations in my mind. I mean, so if the patient is extremely immunocompromised, you need to understand how much of the infecting pathogen you need to reduce to have the patient recover. I think the phages ability to, certainly some phages ability to penetrate biofilms is important. In some of those volume associated infections, small molecules often can’t penetrate that. And so I think having bacteriophage in those types of infections is also important. And it may be that a combination of small molecule and bacteriophage is going to be the best treatment. Right. And so I think that, again, in the confines of a controlled clinical trial to understand that combination therapy of phage plus traditional antibiotic is going to be something that’s worth studying, because that may ultimately be, you know, the best treatment for patients. You get that, you know, fast, fast killing by the bacteriophage and then and then the more prolonged effect of an antibacterial. And there’s also evidence to say that there can be some synergy, which is, you know, which is really good for the patient. So I think there are many attributes we need to understand about bacteriophage, but I think that they will play an important role as we move forward.

38:47  Steven Yang
That’s something we’re all happy to hear. Well, we are running a little late on time, Dr. Alm. But before we let you go today, final question. Is CARB-X still accepting new applications? And if yes, what recommendation would you give to the people just entering the market to prepare?

39:06  Richard Alm
Yeah. So I think the answer is CARB-X. The original grant to CARB-X was a five-year grant from BARDA. And that’s coming to an end back in the middle of 2021, BARDA announced a broad agency competitive application code for biopharmaceutical accelerate, which is what CARB-X was and their commitment to fund such an accelerator for ten years, which is a tremendous commitment by the U.S. government. Now, the group at Boston University, we applied for that and we’re waiting. And so hopefully, I mean, they will certainly be a biopharmaceutical accelerator, whether it’s the group at Boston University or another one that they choose is unknown yet. But I think that whichever group gets that, there will be application calls immediately because as that new funding comes in, then there will be money to spend on innovative emerging technologies. In terms of the advice that I would give anyone that’s applying for these types of funds, it’s probably, probably multi-pronged. I think it’s you know, I’ve already mentioned come in with a knowledge about the patient population you’re trying to treat. I think that’s you know, having the end in mind is very important. It doesn’t matter even if you’re early and hit lead, you may not have your full clinical development strategy developed. You almost won’t. But you still should have a vision as to where you want to go. Be extremely conscious about presenting pertinent data and have, you know, the application is confidential and so be as data rich as you can, acknowledge what gaps you have and come up with a plan as how to most expeditiously fill those gaps with data that can convince you one way or another. I think, you know, all of us scientists realize that not everything is going to work every time. The best product developers know how to take data and pivot and understand where they can improve rather than just being blunt. Never be afraid to get the right answer right. Even if that answer may not be what you want to hear for the development of your product, it’ll inform the next generation of your product, which will be even better. Right? Right. Science is an iterative learning process and I think we all need to learn from that. So I think that’s my advice. I think start with patient in mind. Be as data rich as you can, acknowledge your gaps and how you’re going to fill them.

41:49  Steven Yang
Great. Wonderful. Yeah. Well, thanks so much for joining us today, Dr. Alm. And I guess good luck to all the companies in your portfolio.

41:57  Richard Alm
It’s been my pleasure. It’s been wonderful. I think going on this journey with CARB-X and seeing so many innovative technologies and I hope to be able to continue doing that.

42:08  Steven Yang
That’s Dr. Richard Alm. I’m Steven Yang, and this is phage therapy today. Thanks again for your support and listening to our podcast, if you like it. Follow us and give us five stars in the end. Happy holidays.

Antibiotic resistance: How CARB-X helps companies get a running start

Host: Gunnar Esiason
Guest: Kevin Outterson, Executive Director, CARB-X and Professor of Law, Boston University

00:31 Gunnar Esiason
Welcome to the State of Health, the podcast where patients put healthcare decision makers and thought leaders in the hot seat. I’m Gunnar Esiason. Today’s show carries on the antibiotic resistance series. So far, you’ve heard from patient advocates about living with an antibiotic resistant infection, politicians who are trying to fix the antibiotic market disincentives at the heart of the crisis, an investor putting money into companies with the hope that policymakers can make antibiotic development sustainable, and scientists at the bench who are working to develop tomorrow’s antibacterial technologies. Past episodes in the antibiotic resistance series are already in your feed. Today, we learned about the public private partnership that is hoping to launch a new generation of antibiotics. Kevin Outterson, the executive director of Boston based CARB-X joins the show to tell us a little bit about the early-stage antibiotic landscape, the massive amounts of capital that governments and nonprofit organizations are trying to move into biotech companies to keep the antibiotic pipeline alive, and his hopes for the next generation of antibiotics. Let’s talk about the state of antibiotic developers. Kevin, Thanks for coming on the show.

01:49 Kevin Outterson
I’m glad to be here. Thanks for inviting me.

01:51 Gunnar Esiason
What is CARB-X? And what role does it play in the antibiotic ecosystem?

01:57 Kevin Outterson
We actually have a very central role, we take these amazing things that are coming out of university labs from around the world that have been funded by governments, basic science, and we translate them to a product that has completed the first stage of testing in humans, the Phase One testing. And we do that for anything that touches, you know, antibiotics. Both antibiotics and prevention therapy, as well as diagnostics. And we’re entirely nonprofit. We’re based at Boston University. I’m a professor there. We operate globally, we’re funded by governments and foundations and our entire purpose in life is to stop this drought of no outstanding antibacterial innovation in the last several decades, and to really get things that are transformative to patients into the pipeline.

02:48 Gunnar Esiason
How does a law professor end up leading in a global R&D program?

02:57 Kevin Outterson
A lot of what you do in my position is to bring together partnerships, you know, we have five different funders, three governments, US, UK, and Germany, two foundations, the Wellcome Trust and the Gates Foundation. And we worked with 92 different product developer companies all around the world at this point in our first five years. That’s a lot of negotiations and a lot of deals to pull things together, a lot of partnership. And what I did as a practicing attorney, was actually healthcare transactions pulling things together. How I got interested in this is that when I first became a professor, I wrote this — law professors love to write — I wrote this long article, you know, 90 pages on all the things that work and don’t work in drug innovation. But something bothered me because a key assumption in that entire article, 90 pages published in one of Yale’s journals, was that when the drug actually became generic, it would still be just as useful as the day it started. That’s a foundational assumption. But I put a footnote that said, but for antibiotics and things like that, that degrade with use over time, that wouldn’t be true. And went on to finish the article, the articles not about antibiotics, just that one footnote. But it began to bother me, and that basically, everything that works in drug innovation might be upside down and not work for antibiotics. I just became increasingly obsessed. 20 years later, here I am. You have to be careful where your curiosity takes you sometimes, you might be surprised where you end up.

04:45 Gunnar Esiason
I need to address the elephant in the room. I did my undergrad at Boston College and the fact that we can get someone from BC and BU on the same podcast together, I think proves that we could achieve anything in the world.

05:01 Kevin Outterson
It’s like the Yankees and Red Sox. That’s the level of patriots that we’re talking about here.

05:07 Gunnar Esiason
Yeah and exactly for listeners who may not be familiar with the Boston University and Boston College rivalry definitely is a deep rooted rivalry. But nonetheless, it’s exciting to have you on the program. So question about CARB-X again.

Does CARB-X purchase equity, like a traditional biotech venture capital firm?

05:33 Kevin Outterson
No, we don’t. We use the language of investment. And we’re run by you know, all the people who work with us have a lot of industry experience. We make decisions like a venture fund or a business development arm of large pharma would, but we’re entirely nonprofit. We don’t take any equity stake in the companies. What we’re trying to do is to address a global market failure. The fact that these companies can’t make money in antibiotics for, you know, kind of baked into how they’re made today. And so we’re trying to advance that pipeline, improve its quality, improve the innovation potential and, and then hopefully hand it off to people that can take it across the finish line, because we end at the end of the phase one trial. So we’re charitable, we make grants, but we think like a venture capitalist.

06:22 Gunnar Esiason
I would imagine that a venture investor sees CARB-X grant into it into a company or technology, that would be inviting, right, that sort of essentially, is de-risking the earliest stages of adult development to some degree?

06:40 Kevin Outterson
We’ve received 1100 applications around the world and run an elaborate scientific and business due diligence process over time, in a funded 92 companies out the back door. So you know, there’s a lot of investors who are interested in this space who say that our CARB-X due diligence engine helps them to focus on as much smaller and abroad companies. We save them time, by having sifted the world and boiled the ocean to come down with a few. Also, they like the fact that we bring them not only cash grants, but also a lot of technical and scientific and business support. A lot of these companies are really small, that I mean 10 or 15 people. And they have outsourced most of their other work. They need the sort of support that you could get out of a large global company, but they can’t afford it. So we provide the money, but we also have a global network of more than 100, now, experts around the world, mostly people that used to work for large drug companies, but are now retired. And we pay for those folks so that they can provide their advice and help to these companies for free.

8:00 Gunnar Esiason
Why do antibiotic makers need CARB-X? How does drug development work? What are those key infrastructure pieces that CARB-X is providing?

08:27 Kevin Outterson
It’s everything you mentioned (regulatory, clinical trial know how) and then in the earlier phases, just the taking a molecule so you know, you’ll read frequently, in a paper, that published in a Nature or Science, somebody discovered a new antibiotic in the in the soils of Maine, you know, or whatever, from the deep sea trench and they they’ve, but what they mean when they say that is that somebody has found something that in a glass dish, and the petri dish kills bacteria, right? Taking that, and translating that into whether it can help mice, you know, who have bacterial infections that can help other animals have bacterial infections, and eventually be proven to help humans with bacterial infections. That process of preclinical development has many ways that things can go off the rails. And a well run project, you might start with 30 such early preclinical projects and end up with one actual drug at the end of the day. So our goal is to help them understand what they don’t know. And to the extent that we have people within our network that we can provide to them, that will give them a menu. Here’s five people that know a lot about the issue that you’re facing. Pick one and we’ll take care of it, we’ll pay for the cost. So we’re here to accelerate, you know, CARB-X stands for … “acceleration” is the X. And we want to help these companies not die from being ground into economic dust because the economics are so bad. We want to see this really great science move forward.

10:14 Gunnar Esiason
Is there anything out there that’s exciting when we consider traditional antibiotic treatment? Are there things out there that CARB-X looks at? Are there things that CARB-X just doesn’t look at? Or is it more of an all-encompassing look at the space?

10:41 Kevin Outterson
Yeah, in a way, this is a question of which of my children do I love the most right? But I’ll answer it, you know, it’s been my entire life. I’m 59 years old, but it’s been since 1962, that we discovered the world discovered a new class against the worst bacteria that actually got approved by the FDA. That’s along the last discovery that was approved by the FDA my entire life. And almost everything 36 out of the 37 therapeutics in our portfolio today would qualify as the first such thing in my entire life, 36 out of 37 therapeutics. And the last one is also very exciting, but it happens to be from a known class. So what we’re doing is extraordinary innovation, you know, any one of those that makes it through will be the biggest news in six decades in antibacterial innovation. But there’s, there’s a wide variety, I mean, there’s things as unusual as phages, you know, viruses that eat and attack bacteria, ones that are engineered to detect specific bacteria, and to kill them to entirely new chemical classes, things that have never been used before, and therefore go after different targets in the bacteria, and therefore, there’s probably not pre existing resistance to that. And then all sorts of other things that people just called non-traditionals because they’re completely different approaches, you know, somebody would attack a biofilm, you know, in a wound or an infection are in the lungs. Biofilms are like defensive structures that bacteria build in order to make it harder, easier for them to live and also harder for antibiotics to penetrate. For anti-virulence compounds that are designed not so much to kill the bacteria, but to make it, you know, less dangerous to the humans. So, anything we touch is likely to be the most innovative thing that we’ve seen in the approved drug categories for the last five or six decades.

13:34 Gunnar Esiason
Now let’s talk about the actual antibiotic market. Sort of maybe the reason CARB-X is in existence or the reason that it needs to help some of these companies. And something that we’ve spent a lot of time talking about on the podcast for the last couple of weeks. But what is standing in the way of antibiotic drug developers and a sustainable market?

13:55 Kevin Outterson
You think about any product that you have in your life, like your cell phone, you know, new technology we can adopt. And usually the new technology is expensive, but there’s no good reason for the government to limit our access to the iPhone 11 or 12. Right. There might be a good budget reason for me not to buy it but it’s our choice. And the new technology sells not only high prices, but high volumes. For antibiotics, we have an excellent reason not to use it today. You know, the newest antibiotic, we would love to actually use it as little as possible for as long as possible, keeping it on the shelf and still use the ones we have today for as long as they last, and drag it out. Now that’s a wonderful answer for public health. It’s the correct answer. Let’s save the new antibiotics for the future. But think about it for the company. They’ve got 10 to 14 years of patent life by the time they get approved by the FDA. They need to make sales in that first decade or else they’re dead. But what actually needs to happen from a societal standpoint is to sell almost none of the antibiotics for the first decade, great for society, instant bankruptcy for the company. So, you know, if the cell phone had to be, you know, we had to absolutely hold on to our old phones until they absolutely died. And they could prove to a doctor that we needed another one, I think we’d have a broken cell phone innovation market, I’d still be using the things that look like bricks from the 80s. So that’s the basic problem. This is a product that we want to save and not spend today. So there are other things like that in the world, you know that, if you’re in a commercial building, you’re you know, or the university, the University is filled with fire extinguisher equipment embedded in the ceilings, right, and then the walls, you pay for that in advance, hoping to never need it. You don’t pay for that once a fire is broken out, you pay for decades ahead to prevent a fire. And so we need to shift the way that we’re thinking about paying for antibiotics, instead of paying for per pill based on volume based on need today, we need to pay for them more like fire extinguishers or fire departments or preparedness. And that’s the shift that the PASTEUR Act makes in my mind,

16:24 Gunnar Esiason
Then you’re talking about preparedness here. And I think the world has certainly learned a hard lesson over the last 18 months for, you know what failing to invest in preparedness could look like and it’s, you know, coming from somebody who’s lived with infectious diseases entire life, it’s I can’t say it’s super shocking. But it’s definitely something that I think is an important message to be sending right now. But you mentioned the PASTEUR act. Another thing that we’ve talked about on the podcast the last couple of weeks, sort of a legislative item going through Congress right now that we’ve had, you know, both Senator Young and Senator Bennett, the co-sponsors of the bill on the podcast.

Can you talk about PASTEUR, and then there’s also another bill out there the DISARM Act? You know, are they complements? You know, what’s different between them? You know, it’s, it seems like there is some hunger or some appetite to sort of fix this problem from a policy level too.

17:28 Kevin Outterson
I’m a big fan of the PASTEUR Act. And it really answers the questions. I’ve been asking in my academic work for the past 20 years, right? How can we pay for antibiotics based on their value to society, even if we don’t want to use them very much for the first five or 10 years? And the genius of PASTEUR is that the answer is let’s do a subscription. This is like Netflix, you know, whether you watch no shows, or binge 24/7, or you lose track of the rest of your life, there is a paid subscription. And so PASTEUR would set high standards, a few drugs will qualify. And in the federal government pays in advance for them, even if we don’t need very many of them. The company goes away satisfied. The research and development gets reimbursed. We have these drugs ready. We don’t have to use them at any time. But they’re ready for the future. And we are prepared. Right. So I think it’s a brilliant idea. I applaud Senators Young and Bennett and the House sponsors as well, Doyle and Ferguson. It’s a great piece of work. And it has real potential. As we look at the pandemic bill that will eventually go through Congress this year. To understand that, yes, we want to fight the battle against COVID. But we don’t want to just focus everything on the last war. We need to remember that the biggest branch of the tree of life, you know that the most numerous thing that has species and on the earth are bacteria, and they’re the longest foe of humanity think the plague think cholera. And today antimicrobial resistance. We need to also be prepared for bacteria and PASTEUR will do that. You also asked about DISARM. There was a clever idea in 1983 during the Reagan administration to save money for Medicare. Everyone thought it was a great idea. It’s been adopted around the world. It’s when the hospital gets paid in Medicare, they get a single payment for everything that happens at the hospital. So you know, the hospital bed, you know, in the nurse and the drugs you need while you’re in the hospital, and the food unfortunately, were included in that bundle payment. And it saved money for Medicare without a doubt, but it had an unintended consequence. It punished any hospital that uses a branded on patent antibiotic because they will lose money on that patient. Right. So what DISARM is designed to do is to fix that problem to eliminate that unintended consequence of Ronald Reagan’s 1983 reform to Medicare and put them more in a level financial playing field. These ideas are complimentary, you DISARM is more of a let’s fix what’s broken about how Medicare pays for drugs. And PASTEUR is more about let’s dramatically change our societal valuation of antibiotics and pay for value, not volume, and do so in a way that helps the company survive. So I’m a fan of PASTEUR. I’m a fan of DISARM, I think they absolutely work together. But the one that has a chance of moving forward now, I’m told I’m not a political expert, is PASTEUR. And so that’s where my focus lies.

22:09 Gunnar Esiason
Now, I want to go back to CARB-X for a second. What does CARB-X represent? You know, it’s not so often you hear about a fund set up with, you know, public capital or money from foundations to invest in private biotechnology companies. Of course, my life is very close to one such nonprofit organization that invests in biotechnology companies. But what but what does CARB-X really represent for the life sciences and for, you know, global innovation?

22:40 Kevin Outterson
Most of the companies that we support are extremely small. And most of them have reported to us that if we had not been able to support this project, either the project would have died, or the company itself would have died. You see many antibiotic companies because of this market issue that I’ve described, which has become acute in the past five years. Switching to other things, that they’re taking people that that are smart microbiologists, and they’ll move over to viruses or Coronavirus to hepatitis C, hepatitis B, or leave infection entirely. And, and go over to a field that has lots of money like immune oncology. So think about infrastructure, where we are losing the human capacity to develop antibacterial drugs, because the teams of scientists who do that, who know how to do that their organizations have been ground down by terrible economics of the past decade. And so CARB-X is there to just find the most amazing projects that advance them so that they finish their first human trials and are ready to go on to the later round of human trial development. And, and also, you know, indirectly we’re keeping alive the planet’s ability to do this, you know, that the last estimate I saw put up by the German government a couple of years ago, there may only be 600 – 800 PhD scientists left in the world who know what they’re doing, and are able to develop an antibiotic. And a lot of them, I have to say, are nearing retirement age, have a lot of gray hair. And, we need younger, newer scientists, the next generation to join this effort. And it’s hard if all the money for research and for grants and for the companies is in everything, but.

24:46 Gunnar Esiason
You know, it’s the things are you’re saying there I think echo a lot of what Henry Skinner said on the podcast a couple of weeks ago, and he shared a similar fear in that the next generation antibiotic developers is, you know, hinging on really a desire or, you know, hope, hopeful desire for people to get involved in the basic, the basic groundwork of science to do this. So I think it’s a nice sort of link to a past show. And I’ll finish I’ll finish today’s episode with the same question that I asked. I asked Henry from the AMR Action Fund, what does CARB-X need to achieve, to mean that it was a success?

25:31 Kevin Outterson
I told you earlier that it’s been six decades since we’ve had the discovery of a drug that actually was a first in class against the worst bacteria approved by the FDA. In a long time, we’re loaded with such things at CARB-X. I want to see one or two or three or four entirely new classes, groundbreaking things, have them come through the CARB-X portfolio, be approved by the FDA and EMA in Europe, and actually being used sparingly in the patients that need them. To make that happen, and make it sustainable, I think requires the PASTEUR Act, because, you know, even if we paid for all the costs to get the product all the way to the to the FDA approval, you still need a company you need somebody to keep that drug ready and alive and keep doing research on it. So that improves. And PASTEUR I think is that essential link in what’s out there. And so, you know, it’s interesting, our work is we start like 15 years before a drug would be approved. That’s how long it takes to go through this process, as you’re well aware, having spent a lot of time looking at research. And but so we might still be, been around for five years, we might still be five or 10 years away from that first moment. But we can certainly see a change, you know, years ago, the pipeline was characterized by the WHO and Pew Charitable Trust as fragile and weak. And now everyone recognizes that what’s coming through the CARB-X pipeline is amazing. We are grateful for all the little companies doing that work, a couple of big companies with mainly little ones. And I’m especially grateful for people like the NIH, NIAID, who’s just funded this basic research for decades, and we’re able to build upon that, and bring it to patients.

27:32 Gunnar Esiason
I think it’s a, you made an insightful comment there that the amount of time that it takes from you know, getting from the test tube to the patient is we always like to say is just so extraordinary. And you know, I’ve lived it on one hand, and then I think the first time I ever actually built a cash flow model to project what that looks like you see them in an Excel spreadsheet, it’s just like a whole different mindset required to look at it. And I think you’re right that people see it for almost like in this very unique position. On one side, we have like the high flying sexy biotech industry that’s developing and cranking out precision medications that have just been, you know, absolutely life changing for people with CF. And then on the other side, you know, we are relying on those antibiotics that have, you know, been around since the 60s and haven’t really been, you know, iterated upon to a point where they’re materially different. And I look at my own life, right, you know, I’ve gone through first, second, third line antibiotics and now I’m all the way down to last on antibiotics is my only my only remaining options so it’s a personal issue for me, it’s a personal issue for a lot of my friends, my entire patient community and I think the things that CARB-X is doing alongside the AMR Action funding, hopefully our policymakers in Washington if they can get on board with this really do have the potential to make a meaningful change. So with that, I just want to say go ahead

29:02 Kevin Outterson
The CF foundation as you know works with several companies that CARB-X supports, you know, we have been actively looking for several years now any new drug getting new chemistry come in the CARB-X, you know, we evaluated for whether it can have a specifically helpful impact in the CF world and the foundation’s been really helpful in that process for many years. And also know the foundation has been helpful as it is a voice of patients who need new antibiotics in Congress and in Washington. And I applaud that effort. It’s absolutely vital that that continue. I’m grateful for what the foundation is doing. And what you’re doing.

29:50 Gunnar Esiason
Well, thanks, Kevin. I do appreciate the comments and I appreciate you coming on the episode. Good luck with the work and I look forward to seeing what CARB-X is able to do. You know, once we’re able to sort out this policy mess and the reimbursement issue from Washington.

30:09 Kevin Outterson
CARB-X.org Go look at the companies that we’re supporting and the amazing sciences going forward.