TB Market-Critical and Profitable

Once thought to be a disease of the past, tuberculosis is now a front burner health problem. With 8.4 million new cases recorded in 1999 and a death toll of nearly 6,000 a day, it would seem that TB should also be on the front burner of pharma R&D. Yet, because of industry misperceptions, efforts to develop new treatments have been lackluster.

The Global Alliance for TB Drug Development hopes to change that. Founded in October 2000, the public��private partnership's first order of business was to conduct a study establishing that tuberculosis is a robust market that could reach $700 million by 2010. The report was inspired by a 1998 World Health Organization interview with 19 senior pharma executives that discussed the incentives and disincentives of developing new cures for tuberculosis.

"Two misperceptions were quite prevalent in the industry," says Dr. Doris Rouse, head of Research Triangle Institute's global health programs and one of the report's primary authors. "One was that there was not an unmet medical need, which is clearly not the case. And the second one related to the market. Companies felt that the worldwide market for TB products was only about $150 million."

In contrast, "The Economics of TB Drug Development" says that the current annual market for a single anti-TB drug ranges from $316 million to $432 million, with two-thirds coming from the private sector. That estimate is based on anti-TB product sales reported by IMS Health and sales projections for countries with high TB rates but no available data. Researchers based calculations on the rate of new tuberculosis cases in 20 established market economies and 11 high-burden countries. It's important to note that countries with high rates of AIDS have equally high rates of TB, because AIDS compromises the immune system, making patients unable to fight a tough microbacteria that might otherwise stay dormant.

Researchers also included cases of multiple-drug resistant TB and latent tuberculosis infections, in which the bacteria is present but not actively reproducing. The report's estimates were also based on the assumption that new treatments will be taken for only two months-one of the alliance's goals-rather than the current six months, one of the biggest contributors to the spread of TB and the proliferation of resistant strains.

To support the premise that anti-TB drugs are profitable, the alliance also estimated the costs of development for such products. Excluding the costs of failure, the report puts the development expenditures of a TB compound between $36 and $40 million. When unsuccessful projects are included, the costs range from $76 million to $115 million. Neither of those estimates include the costs of discovery, which are difficult to estimate and can range from $115 to $240 million. But the alliance's partnerships will be based on established, viable compounds.

With those profit projections, the alliance hopes to stimulate anti-TB R&D in the pharma industry. According to its mission statement, the alliance also plans to "own, control, or manage its interest in intellectual property rights to ensure broad access and distribution of new drugs in developing countries." With Dr. Maria C. Freire-who built and directed the US National Institutes of Health Office of Technology Transfer-as CEO, it should readily meet that objective. Freire says, "We are a virtual organization; we don't have research capabilities. But all of our licenses and partnerships, although they have many of the terms and conditions you normally see in the industry, are based on the idea of affordability and access."

The Bill and Melinda Gates Foundation and the Rockefeller Foundation funded the report; and many universities, pharma companies, and government offices contributed to the research. For the full report, see www.tballiance.org.