The Economics of Antimicrobial Resistance

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Public Health Threats and Pandemics

One of the principal contributions of modern medicine is the use of antibiotics to treat infection and prevent its occurrence during surgery. With bacterial resistance to existing antibiotics spreading and too little investment in new products, those gains are now at risk, and the consequences could be severe. A recent Review on Antimicrobial Resistance commissioned by UK Prime Minister David Cameron estimated antimicrobial resistance will result in millions of additional deaths annually and trillions of dollars of lost economic output. Lord Jim O’Neill, chair of the Review on Antimicrobial Resistance, joins CFR’s Thomas Bollyky to discuss the economic drivers and consequences of antimicrobial resistance and the role of global cooperation in confronting this challenge. 

BOLLYKY:  Good Afternoon.  My name is Tom Bollyky.  I'm the senior fellow for Global Health, Economics, and Development here at the Council on Foreign Relations, and I'm very pleased to welcome you to this event on the Economics of Antimicrobial Resistance.  I am pleased, but not at all surprised to see we have a packed house.

 

One of the principal contributions of modern medicine is antibiotics.  Accidentally discovered by Alexander Fleming in 1928, these medicines have enabled us to treat infections and to prevent its occurrence during surgery.  But, we have in more recent decades, become complacent with this tool. 

 

Bacterial resistance to antibiotics is inevitable and natural. The first antibiotic-resistant bacteria appeared in 1940. In recent years, we have spurred and expedited this process through the overuse of antibiotics, both in medical practice and agriculture.  While we have done so, we have slowed our investment in new and effective antibiotics in recent decades, and as a result, have not kept pace with this rapid expansion of antimicrobial-resistant bacteria.

 

This combination of overuse and under investment has left us on a precipice of what the U.S. Centers for Disease Control and Prevention have called a post-antibiotic era.  It's not a pretty picture.  In 2013, four hundred eighty thousand new cases of multidrug-resistance tuberculosis occurred globally.  According to the World Health Organization, gonorrhea may soon become untreatable, as more than ten countries have reported strains that are now resistant to all currently available antibiotics.

 

But the problem with anti-microbial resistance goes beyond a few infectious diseases to the heart of everyday medicine.  Routine surgeries, such as hip replacements, or kidney dialysis, or prosthetic implants and transplants become dangerous without effective antibiotics.  Without effective antibiotics, childbirth becomes far more risky.

 

According to the CDC, there are at least two million illnesses and twenty-three thousand deaths caused in the United States caused every year by antibiotic resistance. The burden of antimicrobial resistance globally is less certain, but estimates are around seven hundred thousand deaths currently.

 

In addressing the threat of the antimicrobial resistance, economic analysis has an important role to play in three ways.  First, it can help us quantify the indirect and direct costs of antimicrobial resistance, which is important for mobilizing and calibrating the national and international response.  Second, economic analysis can help us assess and shape the incentives that are driving the behaviors and medical and agricultural practices that are behind overuse of antibiotics.  Finally, economic analysis can help us design the incentives and governance, if any, needed to drive more investment and production of new and effective antibiotics.

 

And to help us think through these economic issues, we are extremely fortunate to have the ideal speaker -- Lord Jim O'Neill.  You have his bio, so I will only summarize.  Jim is an economist.  He spent most of his career at Goldman Sachs, some of it as its head of economic research.  He is most famous for -- well, hopefully antimicrobial resistance will be in the first line of his bio...

 

(LAUGHTER)

 

... but if not, it will be coining the term BRIC, an record that reflects Jim’s long-term and  impressive work on developing economies in general.  Now, Jim leads the Review of Antimicrobial Resistance, commissioned by Prime Minister David Cameron.  That Review is charged with looking at the very economic questions I've outlined here. Oh, and in all his free time, Jim is also a member of the British House of Lords, and now serves as commercial secretary to the U.K. Treasury.

 

We're going to start with about five or ten minutes of opening remarks from Jim, after which I will ask just a couple of questions to get us started. I will then turn it over to you all, so start thinking of your questions now.  Like all CFR events, we will end promptly on time, at 1:30.  Before I start, several warnings, this event is for attribution, so anything you say can and will be used against you.

 

(LAUGHTER)

 

So be forewarned.  Please also turn off any electronic devices and try to refrain from leaving the meeting early.  And with that, I will turn it over to Lord O'Neill.

 

O'NEILL:  OK, thank you very much, Tom.  It's a -- a huge pleasure to come to this entity to discuss this topic.  I hold, as many of us do around the world, this organization in the highest esteem.  And so it's a real privilege.  I'll try to be as brief as possible to encourage the spirited discussion -- especially with the numbers here, where I think we can have a lot of discussion rather than you guys just having to listen to me.  Not least because there's a couple of people around the table that I know have been with us on our journey around the United States this past week.

 

We have two days in New York, down at the bio conference in Philly.  We arrived here yesterday and, of course, today.  So, as I joke with Tom, it's sort of feeling a little bit deja vu after a very full schedule.  The week has been very stimulating, and, frankly, given us some further food for thought about how to progress our efforts.

 

So, as you heard from Tom, I was invited by the prime minister about a year ago, a bit longer.  Completely out of the blue.  I didn't have the slightest idea of what his advisors were talking about when they mentioned AMR.  I didn't know what it was.  My wife, who was with me when I got the call, was really annoyed because I didn't, because she is a scientist by training.

 

(LAUGHTER)

 

One of the reasons I agreed to do it, she said it was the first time thirty odd years that I'll be able to not only understand, but have any interest in anything and issue you're talking about.

 

(LAUGHTER)

 

So, that, of course, influenced me.  And so, to cut to the chase, because of my background -- and here, I think, the dreaded BRIC acronym played a role as to why I asked.  We, with the team, all of whom are to my right, and we decided to embark at the outset on what I'll spend most of my few minutes here talking about is how to position the issue to get attention about it as an economic challenge.

 

A woman that I'm sure a number of you know, I must give her so much credit, Sally Davies, the chief medical officer of the U.K., persuaded the prime minister that, unless anti-microbial resistance was looked at it in different ways, that so many expert scientists around have and continued to do, that it was unlikely that it would get the attention needed to find a solution.  So, whether that's true or not, I don't know, but it's certainly enough stimulus for all of us to do what we're doing.

 

And I should also add that I was given a ridiculously ambitious target.  In fact, in some ways, a major motivation in me accepting it is the short timeframe we've got.  We are expected to come up with a series of specific recommendations by around about this time next year, that will then be taken to the United Nations, to reach some kind of deal in September 2016.

 

And in some ways, reflecting back, I forget occasionally how helpful that tight timeline is, because it's encouraged us to sort of think as bolder, and in some ways as simpler ideas at the core of our recommendations as we do, because otherwise with that kind of target in mind, then we wouldn't probably get very far.

 

So, in this first paper, linked to the way I approach life about making the BRIC thing famous, we deliberately looked at, again, the world of 2050, in which China, India, and some of my other friends in the emerging world, in principle, could become large of parts of the world economy.  And then we with the help of two consultants, we shocked that world with the AMR problem as it is today continuing to escalate.  And, for those of you who are trained in the medicinal sense, you will be aware of that scope, those of you who are not, won't, I suspect.

 

But in essence, long-term economic growth is essentially driven by the number of people that are in the workforce and their productivity.  And so we tried to encourage the analysis to see what impacts the growth of AMR, if undealt with, would have on that.  Here are the three shocking numbers.

 

As Tom said, one of them, to start with today, is that around the world about seven hundred thousand people appear to be dying from antimicrobial resistance each year.  To put that in context, Ebola, as horrendous as it was, killed about twenty thousand people.  Many people don't who were like me, twelve months ago, don't actually know what [the size of this problem] is, including many, many educated people.  It's killing seven hundred thousand people.

 

In our analysis, [the number of people dying from AMR] by 2050, that could be ten million, with more than a million in each of India and China amongst those ten million people.  And in Europe and the U.S., which is about twenty-five thousand in each today, I think we have numbers that are about twelve to thirteen times larger than that by 2050 in each of the U.S. and Europe.

 

And then the final number is in terms of the economic cost.  We showed that on a cumulative basis from today to then, so thirty-five years going forward, the world [economy] will be one hundred trillion dollars, one hundred trillion dollars smaller than it otherwise would be as a result of those deaths, and the hit to productivity of those that are in the workforce around the world, if we don't do something about it.

 

And let me say, two of the things about that.  To put that in context, the world economy today is about seventy-five trillion dollars.  So, the hit [from AMR] to global GDP, or the opportunity lost is more than the current size of the world.  And, the second thing to emphasize is whilst, of course, these numbers are subject to all sorts of remarkable uncertainty, in our judgment, if anything, they understate what is likely the true cost.  Because of the paucity of data about many of these things, I'm touching again, it's an important part of what Tom mentioned.

 

We did not include the human and economic costs [of AMR on] many of those modern, wonderful things that we take for granted, such as hip replacements and hospital challenging surgeries because the data is just so difficult to analyze.  But what we did do was a back of an envelope [estimate], which Anthony, here in the pink shirt, spearheaded, we thought it could be at least twice the number I told you. Occasionally I see some people that [think] know, we are dreaming up ridiculous numbers.  We think, if anything, [the economic cost] could be a lot bigger.

 

We presented, as part of this first paper, some kind of flavor of how [AMR] had hit different parts of the world.  And, again, [this is] linked to why, in hindsight, it probably wasn't a crazy idea to ask somebody like me that's had so much experience of looking at all parts of the world economy, how [AMR] is going to harm everybody.  It's not going distinguish as to whether you are rich, or poor, or you're black or white.  It's going to harm everybody.

 

But, as I said already, my friends in the emerging world would be particularly poorly hit, and especially in parts of the emerging world where infectious diseases are so prevalent.  And, indeed, one of the things that makes these numbers so high is the remarkable progress made on many of them over the past thirty years will be lost and turned backwards.

 

So, in essence, that is the flavor.  A couple of other things, and then I'll stop.  Soon after we wrote that piece, or I guess as we were doing it, we were brainstorming all the time as to what areas should we really hone in on of the multifaceted parts of the challenge.  We identified, I guess, about six or seven.

 

On each of those areas, we are the in the process of writing a specialist paper.  We have done two, we have about another four or five in plan. Most of them will be published before the end of this year as a build up to the specific recommendations we make at this time next year.

 

We are traveling around the world to the places we think are most important.  We have been for a week to India, a week to China, week here.  At some stage, I don't know how I'm going to get it in my crazy diary these days.  I thought I was retiring from Goldman Sachs to have a bit more life to enjoy myself doing other things, but such is the way things turn out.  But we will probably go to Latin America, especially centered around Brazil, I suspect.  And, of course, to somewhere in Africa.

 

Behind those topics, and of course what [strategies exist to] combat them, but I don't have the time to do it now, but I published something in the "White (ph) Times" newspaper, an op-ed about  eight, ten weeks ago called, "Ten Things to Crack the Superbug Problem."  I don't really have the time to through all of those things, but it ranges from what we call the no-brainers.  Five of the ten things we think are things that could be done effectively today if we can get policy makers in their own countries and others to focus on them.  And the other five are more complex.

 

In closing for now, let me say that it is very important in my judgment for people to realize that there are significant issues about the demand side of the problem, as well as there are on the supply problem. Quite frequently, the discussion, and it's dominated much of the discussions we've had this week, not least because we deliberately orchestrated it that way, is about how do you get more drugs.

 

So, that’s the supply problem. And we put our third paper that we published about six weeks about that. And we have some very specific ideas we've been discussing that with a lot with people the past few days.

 

But even for those that presented this challenging goal to me, it was sort of presented that that was the main thing for us to do. As important as that is, and it is a critical part, I want to close for now saying that, in my judgment, it's just as important, if not even more important, to have solutions on the demand side, because even if we do get a lot more drugs, no doubts at some stage, in another generation, people are going to become resistant to those drugs as well.

 

So, a very important part of what we're doing, and it links to some of the ten things [in my op-ed], is trying to essentially change the behavior of all seven billion of us around the world so we stop demanding antibiotics as some kind of sweets or cookies.  And we've got a number of things that are we are pursuing along those lines.

 

So, that's in essence where we're coming from.  Obviously, very much looking forward to the discussion, and not only any questions, but all the really smart ideas that any of you have got, because we are not at all shy about pinching other people's ideas, and getting [the AMR challenge] cracked.

 

BOLLYKY:  Great.

 

O'NEILL:  So, thank you.

 

BOLLYKY:  Great.  Thank you, sir, for the great remarks.  So, one of the things that immediately struck me in reading your reports, and a lot of the literature in the AMR space, is how much this [problem] looks and sounds like climate change.

 

(LAUGHTER)

 

It's a collective action problem.  Basically, you're asking governments and individuals to change their behaviors in ways that benefit us all, but there is a temptation for those individual actors not to change those behaviors because of the significant expense involved.  The failure to mobilize that kind of collective action leads to this long-term steady descent -- into the terrible outcome in this case -- widespread antimicrobial resistance

 

O'NEILL:  Yes.

 

BOLLYKY: The other way this looks a lot like climate change is that we are actually making progress is high-income countries on the AMR issue.  Over-prescription in the United States, and in Europe -- many parts of Europe, in medical practice has started to decline.  We are also slowly, too slowly, by many people's account, trying to tamp down on the use of antibiotics in agricultural production.  Too slowly.  But we are.

 

And when you look at the problem globally, global sales of antibiotics for human consumption rose 36 percent between 2000 and 2010. 76 percent of that growth was in the BRIC countries.  And, in that way, the AMR problem looks a lot like climate change, too.  A problem really started in high-income country settings transitions, just at a time where you're starting to see some progress [in those countries], into is becoming a problem in a larger scale in low- and middle-income country settings. 

 

O'NEILL:  Yes.

 

BOLLYKY:  What we can take from the resemblance of AMR to climate change?  I don’t view the comparison to the climate change as a particularly positive one for AMR given the lack of progress on climate. 

 

O'NEILL:  No.

 

(LAUGHTER)

 

BOLLYKY:  But what lessons can we take from the climate change experience?  Are there significant differences [with AMR]?  Do we need a papal encyclical to make progress on antimicrobial resistance? 

 

(LAUGHTER)

 

O'NEILL:  So, I have been encouraged to go and visit the pope actually.

 

(LAUGHTER)

 

In all seriousness.  So, my very bubbly and buoyant mood by a fantastic week has been slightly discouraged by hearing that first question, because we do not like the reminder of how similar [AMR] can be compared to climate change for obvious reasons.

 

But, with that in mind, let me say perhaps two or three things.  So, first of all, in acknowledgement of your question, one of the various, early people I went to chat to about [the Review] was Nick Stern, who is the British economist that pioneered so much of the thoughtful work about climate change. And I asked him, what do you regret about how you approached it?  And he said, the way we ended up with so much focus on what was the economic number.  He said do not make the same mistake.  And, in some ways, we tried to steer away, and when I told him about the number of deaths from AMR, he said, that one, that'll do it.  So, that's the first thing.

 

The second thing, which has been so critical to me, and it partly relates to the whole reason why I dreamt up the BRIC phrase in the first place.  So, one of the ten things [to about AMR] is try and persuade China to take this as a priority goal of theirs for their chairing of the G-20.  By a, hopefully, beautiful coincidence, given the goal that we've been set, next year, China is hosting the G-20, which is a pretty historic moment for global governance. Given that I'm one of the few people in the planet that seem to say good things about them quite often, so they kind of quite like me.  I thought, well, why not try and get them to pick this topic?  And we're in very early stages of our discussion with them, but we've had as recently positive feedback about it, as we could have hoped. 

 

The third thing, I would say, which might put me in the naive camp and it's partly reflective of my background, is I don't think the costs of solving antimicrobial resistance are at all that big.  So, you know, we're on the paper about [the costs of developing] new drugs.  We think, in this paper, we are the first people that have ever been daft enough to try and put a specific number on it.  In fact, I think the WHO once wrote that it was impossible to do, so for some strange reason.  Apologies to anybody from the WHO here. But, we said fifteen to thirty -- sorry, sixteen to thirty-seven billion dollars.  That's how precise we were.  We said sixteen instead of fifteen.  So, sixteen to thirty-seven billion dollars.  That is less than one tenth of a percent of global GDP.

 

When I discuss with some of my old pals in finance what the hell I'm up to these days, and I tell them that number, they write, quite obviously, well, that's nothing.  Surely, to solve that kind of problem, compared with some of the other challenges out there, it's kind of nothing.  And I think they're right.  To put it another context, and this gets me into some areas of irritation with the pharmaceutical world.  That high a number is less than what the top five pharmaceutical spend buying back their own shares every year.

 

(LAUGHTER)

 

It is very modest.  Unless the ideas [in that paper] are wrong, I think the actual cost of solving this is not that big a deal.  And I'll finish off by saying, again, with perhaps my ridiculous enthusiasm, compared with the new job I've just suddenly found myself being asked to do, which is to supposedly help revitalize the north of England, I think this [AMR] challenge is easier than that one.

 

(LAUGHTER)

 

BOLLYKY:  So, let me start by saying, I agree with you on the demand side, as you phrased it, of antimicrobial resistance. It does look a lot like climate change.  But, on the supply side, it's different.

 

O'NEILL:  Yes.

 

BOLLYKY:  The prospects of a technological solution to AMR, [development of new drugs to] at least to defer the problem, and hopefully slow the problem, is a lot more likely in the antimicrobial context than [a technological solution] is, in my view, in the climate change context.  So, that is an important difference.  But, let's talk a little bit about that. One of the things recommended in that paper that you just put out has gotten a lot of attention is that innovation fund for sixteen to thirty-seven billion dollars.

 

O'NEILL:  Yes.

 

BOLLYKY:  One thing that's really unusual about the fund is that it proposes an innovation model of delinkage.  So, it rewards pharmaceutical companies for investing in more effective antibiotics, but separates the return on that investment from the market, by saying, we will instead pay you in bulk sum and create an intermediary to do that. 

 

O'NEILL:  Yes.

 

BOLLYKY:  In a lot of areas of global health, we've had problems developing new and effective treatments and diagnostics.  This has been true for infectious diseases that affect the poor and for which there's no real effective market, no return for those products. 

 

O'NEILL:  Yes.

 

BOLLYKY:  This is also true for antibiotics for terrorism attacks involving anthrax, where they're not likely to be used unless [an attack] occurs and there is a question of how you reward companies for investing in that. 

 

O'NEILL:  Yes.

 

BOLLYKY:  Why do we need a different model of innovation here for these types of antibiotics than we have needed for drugs to solve these other global health drug development problems?

 

O'NEILL:  So let me just also respond to the first part of what you responded to me about, the demand side.  Again, I think with focus, and it is probably trickier than the supply side, but perhaps not as tricky as some people within the scientific world have just ended up persuading themselves.  So, one of the things we're about to embark on with an intern that's joining us is to come up with some specific ideas for a big global awareness campaign, which would have to be differentiated for the countries that you'd want to approach.

 

And linked to that, and hopefully, we'll get into some part of this about the food issue, which is another one of the special papers we're going to write.  This sudden mood that -- we observe from the distance of where we are, I'm going to highlight McDonald's that suddenly starts making noises about how they're not going to sell chickens that are fed by antibiotics is to me a really important potential moment. 

 

BOLLYKY:  Tyson Foods, too.

 

O'NEILL:  I mean, certainly, that’s the sort of thing of thing we're going to help encourage exploration in terms of awareness campaigns. 

And so, the other thing to say about it, so back to our first paper, and the first press conference we had, stuck in my mind.  There was somebody from CCTV, the China state TV, a very young woman interviewed me.  And ]to my slight surprise, with my experience with Chinese people, she said you know, my generation in China is really eager to give you a lot of air time about this, because we're worried what it's going to do us all.

 

BOLLYKY:  Yes.

 

O'NEILL:  And so we want to think of ways of engaging the next generation.  So, what I call Google for doctors, or Apple for doctors, or Samsung for doctors, or whichever one of these guys, I think, and here it is different than climate change again, I think we've gotten to an era of technological capability. The notion that doctors or clinicians, or whatever -- however you call them, have their own very educated guesses as to what it is, whether we give me an antibiotic, it's got to stop.

 

And one of the things we are thinking of proposing, just for our own prime minister to consider in the U.K., is if you think it's important enough to be a review, and you've taken up that much of my time and my team's, well, why don't we legislate into some kind of law that once we've got the right diagnostic, doctors are not going to be allowed to do that. Because that's going to end up enabling all of us to think about these things.

 

Going to your supply side issue and the drugs, we've had some really interesting discussions about it.  And just a little bit more factual information for the group here.  So, what we have specifically proposed with this sixteen to thirty-seven billion dollar total for fifteen new drugs. So, again, I think this is a first.  Here, we had, obviously, some expert scientific help.  I think it's the first time that anybody's been bold enough to identify the exact sort of drugs that we really need.  And we are proposing payments for successful production of those drugs.  And, very importantly, and as you've said, to delink, the payment.  It would also be linked to a mechanism of making sure that they would not result in the same way that would happen with others, that they want and can sell as much of them as they want.

 

And the payment would be for that, and it would include some kind of penalty stroke claw back if it didn't occur.  The intriguing part, just to make it clear, separately, but as part of that, we have also proposed for a two billion dollar innovation fund, over a five-year period.  Controversially we suggest the pharma industry should pay for that -- because they are going to be the beneficiaries of this generosity of some kind of global taxpayer money.

 

And we think it is appropriate, not least given the technical, expert knowledge that they obviously have, that they collectively share the responsibility for a new innovation fund.  Which, as you can imagine, and I'm guessing there's probably some people here from the pharma world, a number of them are not overly excited about that part of our proposal.  The phrase “good luck with that” has been said to me on a number of occasions.

 

But we have got within the industry, there are some supporters of it.  Two big European pharma companies actually signed up to a press release which accompanied that paper.  We have a final thing to say quickly.  We've heard some very interesting discussions with big pharma companies here in the U.S. this week, and given us ideas about what we call a hybrid model.

 

So, you have some central approach, and some new authority that's giving out these payments, but you would have to consider taking in the nuances as to somewhat subtle versions of how you execute that in different parts of the world.  And we heard a lot about this transfer voucher idea, which seems to be what a lot of U.S. pharma companies seem to be interested in. 

 

BOLLYKY:  Yes.

 

O'NEILL:  It's something we're going to look at. We did look at that, but we ruled it out because we suspect it's a lot more costly.  But, in my judgment, if it were more successful for getting the supply curve changed that quickly, it's something we should consider and we're going to look at the numbers again.

 

BOLLYKY:  OK.  Great.  I have lots more questions, but I want to turn it over to the audience.  If people will put up the placards when you'd like to speak, and I will call on you on in the order I see you.  And if you'll only say your name and affiliation, and get to your question, so we can get as many people as possible.  Gary?

 

QUESTION:  Gary Horlick.  I'm a lawyer.  You touched a little bit about on the second half of the supply side, which is limiting supply.  And, perhaps, a more hopeful analogy than climate change was the -- what's called the ozone hole.  A good example of U.K.-U.S. leadership, by the way, where there was basically the final product controlled about 90 percent of supply.  Because you could get hold of 90 percent of the producers reasonably well.  And you didn't have the further layer of prescriptions and drug stores you could also control then.  And that seemed to do the job.  There are going to be some free riders, but partly this was a quantity exercise, and 90 percent was enough.  I don't know if that model works here, but I'm curious if it does.

 

O'NEILL:  Yes.  I'm not sure if I'm understanding exactly what it is you're asking, so apologies if I'm...

 

QUESTION:  Would you get -- you can get in most countries who produces antibiotics. ... and secondly, you get who distributes them.  You already have a layer of...

 

O'NEILL:  Oh, right.  OK.  Yes, yes.

 

(CROSSTALK)

 

O'NEILL:  Yes, exactly.

 

QUESTION:  You know who they are.

 

O'NEILL:  Exactly.

 

QUESTION:  You have their numbers, and all that.

 

O'NEILL:  Yes, so, all obviously at the most basic level, that's why it is different than climate change.  And there has to be some level of what I frequently call enlightened self-interest, where both the producer and distributor, you might need to kind of guide them, and, you know, give them various inducements, but I think you're right.

 

QUESTION:  I'm not an expert on the ozone hole one, but I had some experience with it.  They complained bitterly at the beginning.  This was done through in the end quotas, and it turned out they had all the quotas.  So they were badly off.

 

O'NEILL:  You know, obviously, I'm somebody that spent over thirty years working in finance, the good and the bad part of it.  And I've seen how poorly that industry has essentially behaved with respect to enlightened self-interest, but looking back, I think, many of them kind of regret that they didn't think a little bit more broadly.

 

And within the industry, there are people that we know are basically, really supportive of what we're doing. We need to find a couple of champions for some of it, and that will be the example setting for the others.  One of the things I think we're taking back with us is actually trialing a couple of our ideas in a couple of countries with some specific thing in that regard.

 

BOLLYKY:  The only thing I would say to add to Jim's excellent comments is that there are two big differences with the ozone that might be helpful to thinking about this case.  Antibiotics aren't harmful products.  They're just being overused.

 

O'NEILL:  Yes.

 

BOLLYKY:  So, the challenge with antibiotics is that underuse globally is still a much bigger problem currently than overuse. Over time, that will change. 

 

O'NEILL:  Yes.

 

BOLLYKY:  The second is that it's not the producers that actually control patient access to this product.  It's the physicians.  So, where you really want to get to supply is separating dispensing from prescription and the incentives around that.

 

QUESTION:  It's worse than that, because in a lot of countries you can walk into a pharmacy and buy this stuff.  You don't need a prescription.

 

O'NEILL:  When we were India, the BBC – and I guess it'll still be on iPlayer, BBC did a fabulous "Panorama" program about many of the issues that we're discussing and you've raised, including that one.  When we were in India, they were there, for part of it, with us.  And had themselves really going into various pharmacies and buying anything they wanted very easily.

 

QUESTION:  But...

 

O'NEILL:  But there's a many parts of the world like that.

 

QUESTION:  ... that we're seeing.

 

O'NEILL:  That's true.  Including places developed as Hong Kong, by the way.

 

QUESTION:  But there's some reasons for that, but the governments still know where at least...

 

O'NEILL:  Yes, I think that's right.  Exactly.  So, you know -- you know, in those countries doctors are, you know, you know their names, right?

 

QUESTION:  Right.

 

BOLLYKY:  Libby.

 

QUESTION:  Hi, I'm Elizabeth Prescott.  I'm in the process of signing on to start a national security technology accelerator out of NDU.  But I'm a recovering scientist, but before that I was actually a recovering economist.  And I think it's interesting when you think about innovation in this field, because often when people approach antimicrobial they just continue to throw more, sort of take the same approach. And I'm wondering if you're looking at the positive parallels in the climate change world, such as energy conservation.  Companies like Opower, and various others, have found sort of cognitive biases to hijack, to get better behavior, even subconsciously.  If you're not familiar with the model, I can, you know, we can talk offline.

 

O'NEILL:  Yes.

 

QUESTION:  When you look at how to get the changed behavior, using sort of the trends that are going on right now of empowering the consumer/patient, are you looking at developing tools that help the individual make decisions?  Or are you help the doctors make decisions?

 

O'NEILL:  So, I looked -- and I don't know what, did you say you are a recovering economist?

 

QUESTION:  Yes.

 

O'NEILL:  What is one of those?

 

(LAUGHTER)

 

QUESTION:  Someone who has a doctorate in biology, but I was -- I had previously had done economics.

 

O'NEILL:  Oh, OK.  How interesting.

 

QUESTION:  It's going to complement in different (inaudible).

 

O'NEILL:  OK.  Right, right, right.  So, the answer is yes.  And, you know, this is a repeated journalist statement, we will look at anything.  One of the other benefits of none of us being expert scientists is that we're not going to get stuck. We have to in some cases, particularly over the issues about which drugs affect that part you need.  But, you know, anything we think will materially change the demand and supply side, we will give thought to.

 

On the specific question, I think your question in some ways is a bit broader, but on diagnostics, and Google for Doctors.  I think that is a game changer.  There is Boots Walgreen in the U.K.  I gather it is happening here, I'm not sure.  But in two cities they are trialing -- what's it called?  Strep throat?

 

QUESTION:  Yes.

 

O'NEILL:  Within two minutes of us giving a swab, the lady comes back and tells you whether you need antibiotics or not.

 

QUESTION:  Is the doctor the control on all of that?  Or can the consumer do it, too?

 

O'NEILL:  They go into the pharmacy and one of the really attractive things about that, the more I think about it, is -- I guess this is probably the case here in the U.S., but it's certainly a huge issue in the U.K. right now, the amount of time -- as we all start to live older, and any thing seems to make us think we're about to, you know, go ten feet under, we go and waste our doctors' time.  And so, the pressure on doctors' surgeries, just in itself, could be dramatically reduced by these kind of things.  And from the trialing they have done, and the data they showed us, it's reduced -- it's only a very small sample, but a 70 percent reduction without a doctor even being involved.  So, yes, of course, we're hugely focused on those kind of things.

 

BOLLYKY:  Great.  We have about fifteen minutes, so I'm going to try to get as many people who are up now.  Lewis, next.

 

QUESTION:  Yes, Lewis Schrager from Aeras.  First of all, I'd like to thank you and your team for this tremendously interesting and important endeavor.  I've heard a lot about antibiotics.  Obviously very important, but one word I haven't heard is vaccines.

 

O'NEILL:  Right.

 

QUESTION:  You know, I'm going to tread dangerously, and use perhaps an economic metaphor here.  And, I would, you know, while more antibiotics are certainly an important, necessary investment, they are potentially a shorter-term investment than a vaccine.  That's your long-term investment, because I don't think that most people realize that the changes in organisms that result in antimicrobial resistance are, for the large part, are irrelevant to vaccines.  Once you have a good vaccine, you're not going to be resistant to it. So I was wondering if this is part of your plan?

 

O'NEILL:  Yes.

 

QUESTION:  And how that would work?

 

O'NEILL:  So, next in line, I think it's somewhere in our next four papers, one of them is on vaccines and alternatives for the reasons you asked the question.  In the first week I had agreed to do this, Jeremy had sent me a whole series of papers of stuff that the WHO and many others had written about it.  In addition to joking, given how much knowledge there is, why the hell does anybody need somebody like me?  I said, well, hang on, you know, what about vaccines?  So, yes, we're very focused on it. A discussion we had this morning provoked in my mind what we're beginning to realize, as a part of the buildup to our final piece, we will also try to put forward a reasonably simple sort of ready rechna (ph) of what is the cost and benefit of these individual different approaches linked to the pile of things you just said about vaccines.

 

BOLLYKY:  Great.  Theresa?

 

QUESTION:  Theresa Barker. I run an emerging markets investment fund.  I didn't read your piece.  I hope not repetitive, but two things.  One is I'm sort of presuming you've looked into the business model of doctors and pharmacies.  Obviously we know in India, the business model for a doctor is they get paid if they give a prescription.  And so, then, they further have the -- very often, the pharmaceuticals right there, and then get a margin by selling you the pharmaceuticals. So, the business model is terrible for this problem.  And, you know, everything all of our Indian friends travel with sprawled everywhere in their bags.  And, the same with the pharmacists.  So, the business model for the pharmacists.  And until they have a different business model that rewards them appropriately, they're doing what they need to do to make a living.

 

O'NEILL:  Yes, yes.

 

QUESTION:  So, to me, you may have already addressed that, but that seems to be basic.  So, what's the business model in different countries for the physicians and the pharmacists and how can we change that?

 

And the second thing is, you talked about the right diagnostic, and then disappointingly you talked about strep throat.  Well, we always get swabbed for strep throat.  The problem is, I go to my doctor, and I'm feeling, you know, a cold or a sinus infection, and she does not know what the difference is between a virus and antimicrobial disease. So, if she could have a test, right there, where she could test the difference between a virus and a microbe, then she wouldn't be giving me the antibiotic.

 

O'NEILL:  Yes, yes, yes.

 

O'NEILL:  Sure.

 

QUESTION:  And so...

 

O'NEILL:  And so the question -- sorry?

 

QUESTION:  I'm assuming maybe that's also on your...

 

O'NEILL:  Yes, of course.  I gave the example of strep throat as just one of the most simple of -- of course.  Linked to...

 

QUESTION:  But we all get that, maybe in India they don't all get the test for it.

 

O'NEILL:  You don't.  I mean, the reason why I said it, in the U.K. it's only just being trialed.

 

QUESTION:  Really?

 

O'NEILL:  It's just started.

 

QUESTION:  Oh, my goodness.

 

O'NEILL:  It's in two cities in, I think, probably less than forty different pharmacies.  So, it's not...

 

QUESTION:  So, people -- their doctor doesn't normally swab you for it?

 

O'NEILL:  No. Not at all.

 

BOLLYKY:  To back up Jim in the U.S. it's estimated that one out of ten cases...

 

(CROSSTALK)

 

O'NEILL:  I don't think it's a prevalent in the U.S. as you'd think.

 

QUESTION:  Strep throat -- as a strep throat survivor.  Many, times...

 

O'NEILL:  I do not believe it is anywhere near as prevalent in the U.S. as you think.  But more importantly of course, that is just one bit.  We run about a slew of diagnostics, including the specific one you asked.  So, of course, that is the case.  One of our other papers is going to be about all of that.

 

QUESTION:  So, that's new research, right?  Because they don't' have it.  It doesn't exist.  You've got to create new research...

 

O'NEILL:  Well, that's why we wanted to take -- make a lot of noise about it.  It seems to me...

 

QUESTION:  That's great.

 

O'NEILL:  ... this stage of life where all these guys are, again, particularly the next generation have every gadget that enables anything other than this.  So, of course, it's in -- we think of the bit we know so far.  It's feasible within two years.  Will (ph), yes?

 

(UNKNOWN SPEAKER):  Well, we -- we highlighted, so for in terms of giving a push for new technology for our innovation fund, which Jim mentioned earlier, is also going to be accessible for people that are looking into diagnostics.  So, that should provide some push funding.  And we'll go into more...

 

QUESTION:  That's fantastic.

 

(UNKNOWN):  ... detail in a huge part of that.  So, we're thinking about it.  And, as you say, how can we get this new technology developed?  But also how can we use some of the existing technology, because it's already out there, which Jim has been discussing.

 

O'NEILL:  So, link to that in your comments about our friend in India, by the way, they've got some pretty fantastic diagnostics companies.  So, a member of our sort of loose advisory team that we're putting together is the CEO of India's largest diagnostics company.  And one of the reasons we deliberately did that is we think they can be part of the solution of getting better diagnostics. So not everything that goes on in India is bad.  So, today, some of London's leading hospitals send blood samples to that diagnostic company and have it sent back.  And it's cheaper, and they do it better than they think they can find in the U.K., and they're all already, I think it's Nigeria primarily out of the African countries.

 

On the part of your first questions, so it's true in so many parts of the world.  And it seems to me, of course it's easy to pick on the developing countries, because it seems so clear, but the way these incentives and things are gamed, you know, it's true in Europe, and also here in the U.S.

 

Some other quick comments that relate to one of the reasons why it's important to get it on the G-20 agenda.  Again, linking to my own background.  Today, seven years after the beginning of the mess that we seem to have escaped, there was no global effective regulatory body for finance.  We have something now called the Financial Stability Board that came out of that mess, and whilst obviously how it's supplied may differ in different countries, but there's pretty rigorous similar regulatory systems that apply here, Germany, China, India and all the BRICs.

 

A lot of people in industry and the health care will say, oh, you can't.  You know, it's too complex.  I don't think that's true.  It's only complex because people haven't thought about trying to do it.  People would have never dreamt you could do that in finance.  And one of the beauties of trying to do something like that is obviously is therefore an obligation for you to respond with your own internal systems, including your health system.

 

The second thing to say rather than India, I'll actually pick on my friends in China a little bit.  So, they're even worse in some ways than India.  Because, bizarrely, for “a horrible Communist country,” Ronald Reagan would have been very proud of them.  The amount of money that's centrally spent by China is less than 30 percent of GDP, and on health it's about five.  It's incredible.  I think you guys are at 18 percent, or something?

 

BOLLYKY:  Or twenty.

 

O'NEILL:  So, and the Chinese authorities are, as part of the new better quality China, they're in the early stages of -- I have to be careful of how they say it, but my interpretation is basically they want to introduce their own version of the National Health Service.  And part of it is because they know they've got to get -- right now, even in the very best hospitals, doctors get paid by how many drugs they sell.  And, so, obviously, unless you change that, you do anything about [AMR]. 

 

BOLLYKY:  We have five people, so I I'm going to take them in groups so that we can get through.  I will say one thing on the spending on health insurance in emerging markets: that's one of the things people think will drive increased resistance, more access to health services.  But it underscores also the urgency point across that you're trying to make here.

 

I saw Daniel first, and Nicholas, and then I'm going to John, Michael, and Rita at the end.  So, first, Daniel.

 

QUESTION:  OK, yes, thanks.  Dan Spiegel, lawyer in Washington.  Former U.S. diplomat.  Your life's work today is, I think, probably a result of the fact that the international multilateral global health system is not in good shape.  If it were, you wouldn't be sitting around this table.

 

O'NEILL:  Right.

 

QUESTION:  And so, you know, my question if you look at the dysfunctionality of organizations like WHO, and the over politicization of those organizations, and then you look at some of the dysfunctionality even in the global health systems of advanced economies, not to mention, you know, your emerging markets, developing countries.  How are you going to get some of these innovative ideas that you're laying before the world, adopted and implemented?

 

BOLLYKY:  Great.  Nicholas Your question.

 

QUESTION:  Actually, two very quick comments.

 

BOLLYKY:  Just one.  We have five people, and six minutes left.

 

QUESTION:  One very quick comment on diagnostics in trying to have some hope and expectations attached to integrating diagnostics with therapeutics, there's a lot of work to be done on that.  When that gets a little bit better understood, we'll all see that the business model is even more challenging and needs to be fixed as well.

 

BOLLYKY:  Great.  John, do you want to quickly add yours, and then I'm going to turn it to Jim.

 

QUESTION:  Sure.  Since you've admitted you worked at Goldman Sachs, I must admit I worked for twenty years in the pharmaceutical industry.

 

(LAUGHTER)

 

I can talk to you later about getting all demoralized on the decision and all that.  But I actually two things on demand.  One was -- just my daughter about to start med school, what are we teaching in western society about prescribing?  Is that something you're looking at?

 

And, then, two, you know, the BRICs and the use of antibiotics, I gather a lot of that, aside from the, you know, the doctor in India, or just, you know, getting it over the counter, is that the hospital conditions are not what they are here, I always thought, you know, there's some logic to, you know, it's not as if there really isn't bacterial infection in hospitals.  So, I wonder if that's, you know, a pretty significant issue, at least for you to consider looking at.

 

BOLLYKY:  Great.  So, I think we have global health governance.  We have diagnostics, medical education, and then infection control in hospitals.

 

O'NEILL:  Well, on that first very tough question, it's the optimistic part of me thinks, because we've been discussing it earlier today, that when it gets to that kind of really important question, we must be beyond some of the basic hurdles when people hear our views about that.  Because that's the really meaty -- you know, that's the -- that's the key, right?  So, again, it's partly why I keep banging on about it being a G-20 issue.

 

Perhaps not everybody's heard, but a very important [development] has positively happened in this regard.  They might not even realize it themselves, but the G-7 just issued a communique that included a commitment to AMR, and had about, I think, it was five different bullet points that was part of it.  And, so, we are going to be finding ways to try and encourage them to hold themselves to account for having highlighted it, then, you know, follow through. So, and, again from my experience, when that's been done before admittedly, just at the finance minister level, what is quite funny, but important is that they end up doing stuff about something that they originally perhaps just put it in there, because somebody wanted to get on the plane and go home.  So, that's the way we're going to do.

 

And the second thing to day is, as I think I mentioned before, we are -- we are thinking of trying to encourage our own prime minister who I think, of course, with solid help, has encouraged all us, and given -- unleashed us actually to specifically pursue a couple of areas, to and find another country to do it with, as a kind of model (inaudible).

 

On -- on the -- the prescription and the medical education and the...

 

BOLLYKY:  Infection control, yes.

 

O'NEILL:  Actually, it leads me to say something else I don't think I have said yet.  One of our five no-brainers is it is remarkable how few people are studying this.  And another thing that is a relatively easy intervention, it's got some analogies in recent years in some countries with raising the importance and remuneration of teachers.  Policy makers can do something about that really easily.  And that's one of our recommendations.  And with it, better information about how people think about these things.

 

And it goes right back to the social awareness campaign that, you know, we want to -- WhatsApp could play a huge -- you know, I didn't even know WhatsApp was two years ago, but you'll see before I was in here, and going on about, I'll be honest, a ridiculous conversation with my kids about WhatsApp.  And that's the way to some kind of WhatsApp messaging thing about it.  But whether it's people at universities or anybody -- probably, in particular, who are not fortunate to go to university.

 

What was the other one, sorry?  I've...

 

BOLLYKY:  What I'm going to do is we have two more questions, and you have three minutes -- we have three minutes left.  So, I'm going to give both Michael and Rita thirty seconds each to ask your question, and then two minutes to you.  So, please, Michael?

 

QUESTION:  Your studies have identified a pipeline of new antibiotics.  And how many of these have the characteristic that the bacteria cannot develop resistance, which is the core issue?  Do you know?  Of this new pipeline, whether some or how many have that characteristic?

 

BOLLYKY:  Are you referring to the soil based drugs?

 

QUESTION:  Well...

 

(UNKNOWN):  What we did is identify a list of needs, so I wish we had a pipeline.  We don't.  What we listed as the needs is the bacterias (sic) where drug resistance is emerging, and where we need a new drug to address it.  But, no we -- we don't.

 

O'NEILL:  No, we don't.

 

QUESTION:  We don't know whether any of the new technology has that characteristic that the bacteria cannot develop resistance?

 

O'NEILL:  No, we have not done that.  But I think we might.  In the paper we're writing about, it's going to be a paper about vaccines and alternatives.  I would imagine it will get some air time in that.

 

BOLLYKY:  Great.  Rita, your question quickly?

 

QUESTION:  Yes, very quickly.  Rita Colwell, University of Maryland, Johns Hopkins, former director of the National Science Foundation.  So, I'm an unrepentant scientist.

 

(LAUGHTER)

 

My question is the new tech, I founded a company, Bioinformatics.  My question is the next generation sequencing and the lack of proper diagnosis, because we haven assumption from the days of 1890 that it's a single pathogen, you know, (inaudible).  But it's really mixed pathogens, and so we have an enormous expense treating one pathogen at a time.  And the other aspect of is the tonnage used in fish farming and agriculture, which is really the big problem.

 

BOLLYKY:  Great.  So, you'll have one minute if you want, to take on that question, or just give your last remarks.  And then we'll thank you for your time.

 

O'NEILL:  Well, we need to find out more about that, thank you.

 

BOLLYKY:  Any final remarks?

 

O'NEILL:  I guess the thing that I'd say in closing is I hope I said at the start, and then applied with some of my answers.  You know, we don't want to kid ourselves, especially at this stage, we've got all the solutions, so, about anything I've said here, or anything we've written, especially if you think we're going down the wrong track, please find some way of communicating it to us.  And we will treat it with the seriousness that it deserves.  So, thank you very much for all joining us today.

 

BOLLYKY:  Thank you for joining us.

 

(APPLAUSE)

 

END

 

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