Sweden as a Global Testbed for AMR Incentive Models

Anders Blanck, CEO of Lif, the trade association for the research-based Swedish pharmaceutical industry, writes about the challenges the world faces from antimicrobial resistance (AMR). Sweden has for decades been a pioneer in the field, and Blanck believes that Sweden is an excellent test market for various incentive models that, scaled up to European and global levels, can have very positive effects, both in terms of reducing resistance and developing new effective antibiotics. Blanck also believes that the COVID-19 pandemic can show the way for how, when we work together, we can meet difficult challenges.

AMR is one of the greatest threats to global public health. It is a problem area that has some similarities with another significant threat to humanity – climate change. In both cases, it has taken many years of public debate and a long series of global alarm reports before the consequences of failed measures have been adequately recognised. In both cases, we are already seeing an alarming development. According to the European Commission, AMR causes the death of 33,000 people in the EU every year, and the healthcare costs and productivity losses sum up to at least EUR 1.5 billion per annum.

But it can get much worse. If the present negative development cannot be stopped, there is a risk that healthcare will be thrown back to the days before penicillin. Many millions of people will die. A simple knee operation would be risk endangering a patient’s life. Physicians would stand powerless in the face of a common pneumonia. AMR is a direct threat to all other medical treatments; that is a fact, not fiction. As an example, without access to effective antibiotics, advanced cancer treatments that lead to a weakened immune system cannot be performed. AMR is therefore a challenge that the entire pharmaceutical industry must tackle with full force.

The issues that need to be addressed concerning AMR are not easy to deal with. They involve, among other things, responsible manufacturing with reduced emissions to the environment, and responsible use of antibiotics – but also the supply of existing antibiotics and to create incentives for the development of entirely new antibiotics. At the global level, the challenges look completely different in low-income countries with inadequate healthcare and low access to antibiotics, compared to high-income countries where we instead often see a too extensive use of antibiotics. To continue the analogy with climate change: both global threats know no national borders, and both require large international investments as well as persistent work at a local level. An interesting effect from the ongoing COVID-19 pandemic is that rather small and simple changes at an individual level can make a great difference. A national study in Sweden shows that during the pandemic increased physical distance and greater care taken with hand hygiene have significantly reduced the infection pressure on society and thus the need for antibiotic treatment, which in turn reduces the risk of developing resistance. The study shows that the number of other respiratory infections has decreased in Sweden, and surely also in other countries during the pandemic.

It fills me with pride that Sweden was an early adopter when it comes to measures against AMR. As early as the mid-1980s, the use of antibiotics in animals for growth-promoting purposes was banned. Early on, academic research on antibiotics and its effects on humans and the environment was established, which developed into world-leading institutions with prominent researchers such as Professor Otto Cars, founder of the international research network ReAct. During the 1990s, the STRAMA network was formed, which works both nationally and locally in Sweden with direct oversight for, among other things, ensuring fewer healthcare-related infections and the responsible prescribing of antibiotics. Today, from an international perspective, Sweden has low antibiotic consumption and a relatively favourable resistance situation. The Swedish government has also for a long time had AMR high on the agenda and is pushing for more active efforts in global forums such as the UN and the WHO. Sweden has been a driving force in the development and implementation of the WHO’s Global Antimicrobial Resistance Surveillance System (GLASS). Sweden’s Minister of Health Ms Lena Hallengren is also one of the members of The Global Leaders Group on Antimicrobial Resistance, which was established by the WHO in November 2020 as an independent global advisory and advocacy group with the primary objective of maintaining urgency, public support, political momentum, and visibility of the AMR.

So, what can a small country like Sweden then do about a global problem like AMR, in addition to ensuring the correct use of antibiotics in healthcare and being politically motivated internationally? I believe that Sweden could be an excellent test market for various incentive models that, scaled up to a European and global level, can have very positive effects, both in terms of reducing the development of resistance and developing new effective antibiotics.

There are several major challenges in the field of antibiotics that have so far remained unresolved. One challenge is that most antibiotics have been on the market for a very long time, which means that they lack patent protection. Due to fierce competition, triggered for many years by pricing and reimbursement agencies as well as payors, prices for these antibiotics are usually very low. Within the Swedish reimbursement system, the cost for the patient for an antibiotics course can be only slightly higher than for a package of throat lozenges. Price pressure unfortunately poses a significant risk that some companies choose to use manufacturing methods with a strong negative impact on the surrounding environment which thus adds to the potential risk of developing resistance.

The pharmaceutical industry in Sweden has for a long time been a driving force for the introduction of a reimbursement system which rewards products manufactured with a lower impact on the surrounding environment. Among other things, we have developed an environmental assessment model for pharmaceuticals in collaboration with the internationally recognized institute IVL. Today, the reimbursement system for generic medicines is based only on the lowest possible price. The Government has now accepted our proposal and decided to introduce a pilot project with an environmental reward based on certain environmental criteria that will benefit companies with responsible pharmaceutical production. Antibiotics are one of the groups of pharmaceuticals that will be included in the pilot. If it turns out well, the system can be introduced widely in Sweden and hopefully be an inspiration for other countries.

Another unsolved problem is that very few new and effective antibiotics are researched and developed. This is partly because the scientific challenges are significant. Bacterial strains are becoming increasingly aggressive and are developing resistance more rapidly. But just as important is the fact that the pharmaceutical companies’ usual financial incentives for development from research breakthroughs to finished medicines and vaccines do not exist for antibiotics. The reason is that new antibiotics must be used sparsely to avoid the development of new resistance. Antibiotics that you do not sell do not generate any revenues and therefore payment models that are delinked from sales volumes are needed.

There is no lack of initiatives from the global communities and the pharmaceutical industry to develop new antibiotics. WHO and the UN have gathered around a global action plan. Initiatives on economic incentives have been taken by, among others, the EU, as well as the countries within the G7 and G20. The pharmaceutical industry has come together in the AMR Industry Alliance initiative, and in 2020 several large pharmaceutical companies, the international trade association IFPMA and WHO, the EU and the Wellcome Trust, launched the AMR Action Fund. The goal is to produce between two and four completely new antibiotics by the year 2030. The pharmaceutical companies have committed to invest one billion US dollars to bridge the funding gap that exists today.

To be able to develop new antibiotics two things that must happen. The global investments in research and development to develop new mechanisms of action and substances mentioned above are referred to as push. But at the same time, new payment models for companies must be developed that separate the companies’ compensation from antibiotic use, this is referred to as pull. It is only when new payment models are in place that companies have an incentive to go ahead with the large investments associated with developing promising substances and conduct clinical trials all the way until a new antibiotic is approved by the medical products agencies and ultimately reaches patients. So far, no actor at the global level has been able to present such a payment model. We must have respect for the complexity. Payments to pharmaceutical companies for medicines and vaccines are strictly national competencies. But I choose to be optimistic – the ongoing pandemic has shown that the global community and the pharmaceutical industry have managed to create both push and pull when they, within a year, have succeeded in taking effective vaccines against COVID-19 to mass production.

I have long since been convinced that a small country like Sweden can show the way for larger and more complex markets when it comes to push and pull. The pharmaceutical industry in Sweden has been a driving force for a long time and in 2016 we presented a first layout for a model that separates financial compensation to the company from the number of packages sold of the antibiotic. The Government and national agencies have taken this into account and the Swedish Public Health Agency are now carrying out a national pilot which looks at whether it is possible to ensure the availability of certain medically important antibiotics and thereby increase treatment options for difficult-to-treat infections.

In the pilot, the Swedish Public Health Agency has entered into agreements with five pharmaceutical companies which guarantee to, when necessary, deliver antibiotics used to treat patients in Sweden with severe infections caused by multi-resistant bacteria. The companies must also have a certain volume of the antibiotics in question in stock earmarked for the Swedish market. For this, a fixed annual remuneration is paid to the companies. I do not see this as an optimal solution, but it is still an important first step in the right direction. It is now important with further development and I would like to see us using an evaluation model that can determine the medical value of an antibiotic treatment. Today, there is no link between the guaranteed compensation the companies receive and the value that the antibiotic actually contributes with.

Many are concerned that the pandemic that has plagued the whole world for almost two years has pushed back other areas that require great efforts. Climate change is one such area, AMR another. Both are matters of destiny for humanity. I look more positively to the future. Once we have come out on the other side of the pandemic, we can look back on a time that was marked by suffering and death – but also by constructive collaboration between countries, agencies, pharmaceutical companies, academic research teams and healthcare. I take this as proof that we can also meet the AMR challenge if we all work together. And hopefully, a country like Sweden can show the way from theory to practice.


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