Introduction

Many R&D policy options are being debated in order to tackle the rising threat of antimicrobial resistance (AMR). Among them are “pull incentives” that are given only after the successful approval of an innovative new antimicrobial. Incentives are necessary because when such drugs reach the market, clinicians carefully ration the use of the new agents for many years, protecting them from resistance through stewardship. Since traditional R&D is supported by volume-based sales revenues, many proposals for pull incentives stress the need to delink reimbursement from sales volume (Årdal et al., 2017; Boluarte and Schulze, 2022; Cama et al., 2021). Some countries implementing antimicrobial market incentives have chosen to retain the link between antimicrobial revenues and sales volumes, offering benefits to pharmaceutical companies in the form of reimbursement bonuses or rule exemptions when they introduce new antimicrobials (Anderson et al., 2023; Gotham et al., 2021). This paper considers the merits of non-delinked incentives by examining their impact in one country that is pursuing them—Germany. Germany has been selected because recent policy changes have enabled the country to offer certain treatments and certain pricing benefits as an antimicrobial market incentive. This paper assesses the effect of such a policy compared to a delinked pull incentive by assessing the extent to which German reimbursement policies increased antimicrobial revenues in comparison to what would be expected of Germany’s “fair share” of a delinked pull incentive. Such pull incentives should only be paid to priority antibiotics meeting serious current or projected health needs. While a prior study evaluated whether the German reimbursement rules underpaid a large urban hospital for the use of novel antibiotics (Jeck et al., 2022), our study is the first to our knowledge to assess whether the post-reform German market is functioning as an incentive for antibiotic R&D at the national level.

Background

Antimicrobial resistance is a global health crisis of the first order, claiming 1.2 million lives per year—more than Malaria or HIV/AIDS combined (Murray et al., 2022). Based on an analysis by the Center for Global Development, G7 collective action to enact an effective pull incentive and achieve far more equitable access would avert up to 9.9 million deaths over the next 30 years, saving the global economy up to $4.9 trillion (Towse and Silverman Bonnifield, 2022).Footnote 1 Conversely, if little action is taken and existing antimicrobials stop being effective, entire healthcare systems would be weakened. Surgeries (Teillant et al., 2015), cancer care (Nanayakkara et al., 2021; Zürn and Johnson, 2022), and diabetes care are among the many areas of medicine that rely on antimicrobials to keep patients safe (Hocking et al., 2021).

New antimicrobials could help, but the market is in crisis

There are many ways that the world could mitigate AMR. Resistance has been reported since the late 1930s, shortly after the creation of the first antimicrobials (Davies, 1996). Clinically relevant resistance was discussed as early as 1945 (Podolsky, 2018), just a few years after the beginning of the mass production of penicillin (Gaynes, 2017). Over the 1950s and 1960s, there were calls for greater attention to the potential problem of antimicrobial resistance in scientific literature and at the World Health Organization (Podolsky, 2015), but it wasn’t until the early 1990s that the world started to see major attention among policymakers toward action on AMR (Podolsky, 2018). Up toward the 2000s, policy debate tended to focus on provider behavior and overprescribing (Podolsky, 2015), and on the overuse of antimicrobials in the agriculture sector (Lee Ventola, 2015; Podolsky, 2015). From the mid-2000s onward, stemming out of publications like the Infectious Diseases Society of America’s Bad Bugs, No Drugs: As Antibiotic Discovery Stagnates … A Public Health Crisis Brews, policy debates began to consider the lack of novel antibiotic development as a barrier to the fight against rising resistance rates (Boucher, 2020; Podolsky, 2015). In the mid-2010s, greater momentum for action on AMR saw the release of a Global Action Plan on Antimicrobial Resistance at the WHO, and subsequent national action plans across the world (Charani et al., 2023; WHO, 2015). These plans focus on a wide range of countermeasures to AMR, from increasing awareness and surveillance to enhancing stewardship and increasing investment in needed policy interventions (Charani et al., 2023). As progress continues across the themes of each country’s action plan, over the recent years greater attention and funding have been put toward incentivizing the creation of new antimicrobials through various economic incentives (Podolsky, 2018). For example, the G7 supported market incentives for antibiotics (both push and pull) in the last three Health Ministers’ Communiques (G7, 2021a, 2022a, 2023), and the Global Leaders’ Group on Antimicrobial Resistance recently released their report on the antibiotic pipeline and access crisis in the run-up to the United Nations General Assembly High-Level Meeting on Antimicrobial Resistance (Global Leaders Group on Antimicrobial Resistance, 2024).

There is no way to completely halt antimicrobial resistance. Novel antimicrobials will inevitably be needed to replace existing drugs. The development of new antimicrobials to fill essential gaps is crucial to the protection of healthcare systems and the public in the future. Possessing lower or non-existent initial rates of resistance, new antimicrobials can serve as backup treatments when resistance causes older drugs to fail. New antimicrobials are therefore an important line of defense as AMR spreads. However, antimicrobial R&D is stagnating. The WHO has warned that antimicrobial development pipelines are insufficient to tackle the threat of AMR (World Health Organization, 2022). Between 2010 and 2022, the United States Food and Drug Administration (US FDA) has approved just 17 new antimicrobials (Chahine et al., 2022)—in comparison, the FDA approved 16 new antimicrobials in just 4 years between 1983 and 1987 (World Bank, 2017). The number of major pharmaceutical companies with antimicrobials in their pipeline is shrinking. As of December 2020, only two of the top 50 pharmaceutical companies by sales were developing antimicrobials, compared to 18 companies in 1990 (The Pew Charitable Trusts, 2021b; World Bank, 2017). The median antibiotic development time from hit-to-lead to first regulatory approval is 12.5 years (Outterson, 2021), so the lack of development now will pose a serious threat to public health for years to come (The Pew Charitable Trusts, 2021a). Antimicrobials are experiencing a market crisis. The situation is so dire that seven of the 12 antimicrobial makers that have gone public since 2010 are no longer active (Thomas and Wessel, 2022). In an antibiotic market dominated by small companies, every small company that has received regulatory approval for a new antibiotic since 2010 has either suffered bankruptcy or an unfavorable exit at a significant loss to R&D investors (Dominique Mosbergen, 2023). Table 1 shows the accumulated deficit of these small companies in the quarter prior to their first antibiotic approval versus their current market cap (as of April 2024) or price when they were acquired by another company.

Table 1 Loss on R&D investment from antibiotic new molecular entity projects at small companies with FDA-approved products in recent years.
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Potential solutions to the problem

Many ideas have been proposed to incentivize antimicrobial development (Renwick et al., 2016). Over the past few years, these include, among other ideas, the increase of funding to help antimicrobial development projects move through preclinical and clinical phases of research (often called “push incentives”). Prominent push incentives created in the past decade include CARB-X (which has funded 100 preclinical projects since 2017, deploying more than $400 million), the REPAIR Impact Fund ($165 million fund, now paused after investing in about a dozen companies), the AMR Action Fund (launched in 2020 with more than $1 billion for advanced clinical research), BARDA (an agency of the US government, funding $1.8 billion since inception) and GARDP (spending approximately $100 million since 2016, mostly in advanced clinical and post-approval stages) (BARDA, 2023; CARB-X, 2022; GARDP, 2022; IFPMA, 2024; Novo Nordisk Foundation, 2024; REPAIR Impact Fund, 2018). All of these push incentives work to promote antimicrobial development and access.

Broadly, incentive proposals tend to focus either on policies intended to create or sustain research projects, or policies that attempt to correct the antimicrobial market to ensure that development can be profitable. No proposal has yet proven successful at achieving the latter goal of fixing the antimicrobials market. However, much debate on this topic has solidified around the idea of a “delinked pull incentive” as a reasonable way of fixing the market. A delinked pull incentive is essentially a reward paid after regulatory approval to encourage both R&D and global access and stewardship (Kesselheim and Outterson, 2010). While there are many forms such an incentive might take, the basic idea is that a financial reward be offered to manufacturers upon the introduction of an outstanding new antimicrobial (So et al., 2011). The benefit of a pull incentive is that it can produce revenue for an antimicrobial that is not tied to the amount sold and used. This “delinkage” of revenue from sales volume allows for manufacturers to recoup costs while forestalling against the development of AMR in novel drugs as they are used (Outterson et al., 2015). The benefits of pull incentives have been endorsed in numerous reports and papers on the subject of antimicrobial development (Årdal et al., 2017; Boluarte and Schulze, 2022; Brennan Maressa et al., 2022; Cama et al., 2021; Dutescu and Hillie, 2021; O’Neill et al., 2016; Outterson et al., 2016; World Bank, 2017; World Economic Forum, 2018). This idea has also been debated for many years by the G7, ever since the Vision for Global Health produced by G7 leaders at the Ise-Shima Summit (G7, 2016). In recent years, G7 Health Ministers and Finance Ministers have expressed support for pull incentives in their respective statements (G7, 2021a, 2021b, 2022a), and the 2022 G7 Leaders’ Communique went as far as stating that G7 members will “incentivise the development of new antimicrobial treatments with a particular emphasis on pull incentives” (G7, 2022b). The United Kingdom has led the G7 on this issue, creating a subscription program as a fully delinked pull incentive. Japan too has started work on its own pilot pull incentive, with plans to implement a scheme that would guarantee a minimum revenue for select antimicrobials regardless of sales volume (Ministry of Health, L. and W. of J, 2021). The US is considering legislation to create a pull incentive through the PASTEUR Act, Canada is considering its own pull incentive (Council of Canadian Academies Expert Panel on Antimicrobial Availability, 2023) and there is ongoing debate in the EU over the development of regional delinked pull incentives (European Commission, 2023).

While delinked pull incentives remain a perennial G7 topic, only the UK has a fully functional program at present. Other ideas outside of financial rewards for newly commercialized antibiotics are being considered in many countries. In Europe, there have been debates about potentially creating a special diagnosis-related group carve out for antibiotics, setting up transferable exclusivity extension (TEE) vouchers that would allow companies to extend protections for any of their patented drugs, or implementing tax measures or fees on the use of antibiotics (Årdal et al., 2020). The United States has set up a system to reward producers of new antimicrobials with 5 years of additional market exclusivity and a faster approval process through the GAIN Act (Department of Health and Human Services, 2017)—as with the TEE proposal in Europe, this provides an incentive toward commercialization without direct funding to a private entity by the Government. Some proposals have been made that challenge the assumption that the private sector should be the main driver of antibiotic development. These proposals suggest that the problem be solved by implementing open-source development practices (Todd et al., 2021), or by establishing a publicly-funded initiative to develop antibiotics outside of the traditional private sector route (Singer et al., 2020). There are many plausible solutions to the problem—a monetary reward through a delinked pull incentive is not the only option to be evaluated. That said, it is worth noting that while the US has created non-monetary pull incentives, and Europe is considering them, debate continues in both the US (Bennet et al., 2023) and the EU (Directorate General for Health Emergency Preparedness and Response Authority (HERA) and European Health and Digital Executive Agency (HaDEA), 2022) about implementing a delinked pull incentive as well, or in complement to existing policies. Likewise, proposals for public sector-led approaches also acknowledge the benefits of delinked pull incentives to help fund such initiatives (Singer et al., 2020; Todd et al., 2021). Regardless of what entity would eventually benefit from them, pull incentives are being debated as a means toward alleviating the challenges of antimicrobial development.

Given the discussion around pull incentives as a potential solution or complement to other solutions, it is worth considering how pull incentives could be designed to most effectively fill that role. Most countries do not currently have a delinked pull incentive, but many high-income countries are currently debating them. Sweden offers antimicrobials targeting “critical” pathogens in the World Health Organization’s (WHO) priority pathogen’s list (PPL) a minimum guaranteed annual revenue in exchange for predefined supply volumes (Anderson et al., 2023). Japan’s emerging “pull-type incentive” may be similar to Sweden’s at present. France and Germany have both implemented reimbursement revisions for novel antimicrobials, with France offering certain antimicrobials thought to have moderate or higher added therapeutic benefits a guaranteed minimum price not lower than the lowest price across four reference markets, as well as certain exemptions from price degradation and the possibility of price renegotiations for medicines at risk of shortage (Gotham et al., 2021). Germany offers exemption from benefit assessment and detachment from reference pricing for approved antimicrobials (Gotham et al., 2021). Further examination of the merits of each of these policies is needed to determine their relative effectiveness in supporting antimicrobial market sustainability.

Not all of the above policies are necessarily intended to spur R&D. For example, Sweden acknowledges that its payments are too small to stimulate innovation, but are designed solely to improve access for already approved drugs. On this measure, Sweden’s revenue guarantee has been highly successful in obtaining effective access to several new antibiotics. But if high-income countries followed this example, in due time access would fail unless new drug innovation is also supported (Council of Canadian Academies Expert Panel on Antimicrobial Availability, 2023). Note that Sweden is part of the European Union, which has proposed a substantial pull incentive. If that is realized, the EU, including Sweden, will have contributed its “fair share” to innovation. High-income countries are able to support antimicrobial innovation if they can cooperate in a fair apportionment of the costs.

Paying a “fair share” for the use of antimicrobials

It has been estimated that between $220 million to $480 million in average annual revenues over 10 years will be needed for pull incentives to reinvigorate the research and development ecosystem for antimicrobials; the “best estimate” average figure is $310 million per year per priority antibiotic (Outterson, 2021). The world’s first pull incentive program in the UK was designed around the idea that other wealthy countries would offer their own incentives such that the total offered globally would fall within that range. (NHS England and NHS Improvement, 2020). Note that a new antimicrobial with global annual revenues of $310 million would not rank in the top 200 drugs (Andrew Humphreys, 2022).

The development and appropriate use of antimicrobials benefit the entire world, while the spread of resistance threatens every society. It stands to reason that every country would want to develop its own policies to protect its population from AMR (United Nations, 2016), but unless those policies collectively produce global annual revenues for a priority antibiotic averaging $310 million per year over a decade, it is likely that collective efforts will not be enough to fix market issues. The size of the incentive needed is too large for any one country to shoulder alone. Poorer countries may not be in a position to substantially contribute to financing global pull incentives. For these reasons, there has been much thought about what a “fair share” from each country might look like toward the creation of a collection of incentives that can solve the problem.

The emerging consensus is to apportion “fair share” based on the relative GDP of a group of high-income countries, without expecting a financial contribution from poorer countries. A reasonable starting group is all G7 countries and the European Union, given the ongoing pull incentive proposals in these governments. For the purpose of this paper, we calculate the “fair share” costs of each country and region based on their share of the combined GDP of the G7 and EU27 based on previous research by Outterson (Outterson, Health Affairs 2021). We assume that each country would aim for a fully delinked pull incentive that produces between $220 million and $480 million in global annual revenues for a priority antibiotic over 10 years.

Five provisos are important: First, the targets are total revenues, so any retained sales revenues should be counted as a pull incentive, in addition to payments from a revenue guarantee or subscription. For instance, under the proposed PASTEUR Act, the subscription only covers sales under federal programs. Companies retain revenues from private market sales and these revenues should count for purposes of calculating these targets. Second, these figures are based on 2019 data published in 2021 and should be appropriately indexed for inflation. Third, these estimates assumed robust support for push incentives (covering 50% of preclinical costs) and would need to be increased if those push incentives were not adequately funded. Fourth, the estimates do not account for grants subsidizing clinical development, so each country may reduce its “fair share” targets for grants that support clinical (post-investigational new drug application) development of that specific drug. Finally, these estimates assume payment of the average annual amount for 10 years.

Table 2 calculates each country or region’s “fair share” annually, under low-end ($220 million per year), “best estimate” ($310 million per year), and high-end ($480 million per year) scenarios, without adjustments for national revenues outside the pull incentive program, inflation, or push incentives. Although not a G7 member, numbers for Sweden have been calculated for reference in light of the country’s successful access program. GDP values are based on OECD data as of 2021. Numbers do not add up across rows as we include France, Italy, Germany, and Sweden in the EU27 numbers.

Table 2 Calculated “Fair Share” for antibacterial pull incentives in the G7 + EU27.
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This “fair share” table can be used as a guide to whether an antimicrobial pull incentive is likely to be sufficiently large. The proposed PASTEUR Act in the US clearly covers the range of values, from $75 to $300 million per year, depending on product characteristics, further bolstered by private revenues outside the subscription. The original UK subscription, capped at GBP 10 million per year, was at the lower end of the range. However, in July 2023, the UK announced a higher cap of up to GBP 20 million (with a higher cap once the balance of the UK is included) for the most innovative products (NHS England, 2023a). The new UK caps now cover the full range of “fair share” values. By contrast, Sweden’s access program, which offers approximately $400,000 per year, would need to expand to $2-5 million for priority antibiotics if it is to function as an R&D incentive as well. Reimbursement reforms in Germany will need to deliver average annual revenues of approximately $27 million (approximately 25 million euros at current exchange rates) over 10 years to achieve these “fair share” targets.

Germany’s response to calls for pull incentives

Germany has stated previously at the G7 that it is responding to the need for incentives through reforms to its reimbursement policies around antimicrobials which give an “advantage in German pricing processes and eventually (leads) to an appropriate value-based pricing for new innovative antibiotics” (G7, 2021c). Specifically, the country has highlighted provisions within the Act on Fair Competition among the Statutory Health Insurance Funds (GKV-FKG) that allow manufacturers to set antimicrobial prices beyond the limits of reference prices without having to show added benefits (G7, 2021c).

This policy is the latest in a series of moves aimed at ensuring that antimicrobials in Germany can be more appropriately evaluated. Alongside the introduction of benefit assessment rules over the past 12 years, Germany has seen a gradual shift from a system in which it was very difficult for the benefits of antimicrobials to be expressed in pricing to one in which more and more antimicrobials are being allowed greater pricing freedom.

In principle, in Germany, all drugs are approved once granted authorization by the European Medicines Agency (EMA). However, new drugs are not actually introduced to the German market unless they are priced for sale in the market by manufacturers. This effectively creates two approval hurdles that new antimicrobials must move through to reach the German market. To enter Germany, manufacturers need to show efficacy to the extent that a drug can pass through regulatory review, and they have created a drug with a profile that is sufficiently suited to the German market to the extent that it will be possible to sustainably supply the drug without financial hardship. Put another way, there are two policy levers to encourage German access—regulatory measures at the EU level and reimbursement measures at the German level. The details of regulatory rules can have a substantial impact on the success or failure of antimicrobial ventures (Daemmrich, 2009; Rex et al., 2019). Possessing control over the last step prior to the granting of access to the public, German regulators have much power to incentivize development and access.

Since the enactment of the Pharmaceuticals Market Reorganization Act (AMNOG) in 2011, innovative drugs entering the German market are given 1 year of free pricing, during which manufacturers are allowed to set prices as they see fit. Over the course of that year, drugs are subjected to an “early benefit assessment” by the Institute for Quality and Efficiency in Health Care (IQWiG). Drugs are examined for superiority to current standards of care, and judged by the extent to which they are thought to provide added benefit. The Federal Joint Committee (G-BA) reviews assessment findings and sets out pricing procedures accordingly. If no added benefit is found, drug prices are renegotiated to be under a maximum threshold based on a reference price set according to the type of drug in question. If the drug in question cannot be placed in a reference group, the drug price is set no higher than the price of whichever drug is selected as an appropriate comparator. This system applies to all outpatient drugs, except those with costs to the health insurance system of less than one million Euros per year. Inpatient drug costs are negotiated between manufacturers and hospitals or hospital groups, with a price ceiling equivalent to the drug’s outpatient price (Wenzl and Paris, 2018). The price set for a treatment is not a guarantee of reimbursement. For inpatient settings, reimbursement is determined through a diagnosis-related group system. There is evidence to suggest that this distinction is causing a funding gap between antimicrobial prices and reimbursement amounts (Kållberg et al., 2023). To avoid the risk that drugs will not be reimbursed for their full price, among other reasons, manufacturers may choose to set prices lower than the maximum they are allowed by the German pricing system.

Since 2018, all pharmaceuticals used in a hospital setting have been subject to early benefit assessments, including novel antimicrobials. Policy changes in 2017 exempted some antimicrobials, but those exemptions were decided by G-BA on an ad-hoc basis.

Between 2010 and 2019, the EMA approved 14 new antimicrobials. A 2022 study found that five of those drugs had still not been marketed in Germany (Outterson et al., 2022), including drugs on the EML or considered “innovative” or “possibly innovative” by the WHO (World Health Organization, 2019). In an effort to improve the situation for antimicrobials, in 2021, Germany enacted a policy as part of the Fair Statutory Health Insurance Law (GKV-FKG) that created a process to designate novel antimicrobials as “reserve” antimicrobials that could be exempted from benefit assessments. The process also allows manufacturers to enter a negotiation process that would set the price of the drugs above reference price values. To be designated a reserve antimicrobial, the drug in question must be effective against multi-drug resistant bacteria and there must be few alternative treatment options. The price negotiations impact antimicrobials dispensed in outpatient settings. Prices for antimicrobials used in inpatient settings are negotiated between hospitals or hospital groups, with the outpatient price set as a price ceiling (Wenzl and Paris, 2018).

“Reserve” status is granted in Germany following an application by the manufacturer and an evaluation by G-BA. Reserve antimicrobials are those that are considered effective against severe infections caused by multi-resistant bacterial pathogens and used in strictly defined indications (Federal Institute for Drugs and Medical Devices and Robert Koch Institute, 2024). At the beginning of 2024, the Robert Koch Institute and the Federal Institute for Drugs and Medical Devices updated the criteria for the classification of treatment as a reserve antibiotic (Federal Institute for Drugs and Medical Devices and Robert Koch Institute, 2024). The criteria are based on a German analysis of the WHO PPL (Robert Koch Institute, 2021) with the considerations made for the national context of Germany.

The policy for “reserve” antibiotics has been applied to five drugs so far. Shionogi’s cefiderocol (Fetcroja), MSD’s imipenem/cilastatin/relebactam (Recarbrio), MSD’s ceftolozan/tazobactam (Zerbaxa), Pfizer’s ceftazidime/avibactam (Zavicefta), and Paion’s eravacycline (Xerava), licensed from Tetraphase (AMNOG-Monitor, 2022). Two of these drugs (cefiderocol and ceftazidime/avibactam) have been selected by the UK subscription program and will therefore be a special focus of this analysis.

This paper evaluates whether German reimbursement reforms to date have delivered the “fair share” revenue amounts required by Germany for cefiderocol and ceftazidime/avibactam.

Data and methods

Sales volume and revenue per month data for antimicrobials introduced in Europe since 2010 were acquired from the IQVIA MIDAS database. Data was available from Q4 2016 to Q4 2022. Revenue figures are reported in Euros, price is reported in Euro per day of treatment, and sales volume is reported in “units,” which is one standard package of each antimicrobial (regardless of whether that package includes one or 20 doses). The IQVIA MIDAS database contains sales information from a representative sample in Germany of 4,500 pharmacies (out of approximately 19,600 nationwide) and 500 hospitals (out of approximately 1,900 nationwide), which is projected to achieve estimates of total nationwide sales (IQVIA, 2022).

We examined the revenues of reserve antimicrobials compared to what Germany might contribute as its “fair share” for delinked pull incentives. “Fair share” was calculated as described in the text above-accompanying Table 2. An interrupted time series analysis was run on sales, revenue, and price data for our study drugs in Germany to determine if the granting of reserve status itself had any impact on these variables. This analysis assumed seasonal autocorrelation in trends between similar months each year. This analysis was run in SAS® (version 9.4, SAS® Institute Inc., Cary, NC, USA) based on a macro developed by Caswell (Caswell, 2017).

This analysis includes estimations of the level of unit drug pricing required to achieve Germany’s “fair share,” assuming no changes in the volume of use. These drug pricing projections are calculated by dividing Germany’s annual “fair share” for a delinked pull incentive by the annual revenue of each drug in question, multiplied by the median price per day of treatment, multiplied by the current average annual revenue.

We calculate whether these two reserve drugs will be able to achieve revenue comparable to the financial benefit of a fully delinked pull incentive during their period of market exclusivity at current prices. That estimate was calculated by taking revenue data for each drug and projecting forward with the assumption that every future month would have similar revenue to the average revenue for that month across the period of time for which revenue data is available per drug.

During the development of this paper, some data and analysis were pressure tested with both the relevant companies as well as members of the German government. No external funding supported this paper and the authors retained complete academic freedom. Any errors should be attributed solely to the authors.

Results

Have Germany’s reforms produced a positive difference in revenue for the affected drugs? Have Germany’s reforms affected antimicrobial sales volumes?

As of April 2024, five drugs have received “reserve” status thus far in Germany (cefiderocol, imipenem/cilastatin/relebactam, ceftolozan/tazobactam, ceftazidime/avibactam, and eravacycline). This analysis examined the IQVIA MIDAS database for information on two of them which have also been selected for the UK antibiotic subscription program: ceftazidime/avibactam and cefiderocol. Figure 1 shows revenue trends for the two drugs. Given their identical trends, only revenues are charted here—sales volume is omitted. Table 3 shows median prices from 2017 forward. Note that these prices are not adjusted for inflation, so the declining trend in price actually represents a larger fall in value given the average 2.74% increase in consumer prices in Germany every year over the study period (Statistisches Bundesamt, 2023).

Fig. 1
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Revenues of reserve antimicrobials in Germany, monthly, 2017–2022 (Euros).

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Table 3 Median price of reserve antimicrobials 2017–2022 (Euro/day of treatment).
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As Figs. 2–3 show, that awarding reserve status itself did not have a discernible impact on price, revenue, or sales volume. Table 4 shows the results of an interrupted time series analysis which found analytically that the granting of reserve status did not cause a change in revenue, price, or sales trends or level. Only the pre-reserve status trends for price and the post-reserve status trend for sales volume of avibactam/ceftazidime were non-significant. This confirms what can be seen in Fig. 3—the slope for the trend line for those trends over those periods is nearly flat. Otherwise, upward or downward trends existed for both drugs in terms of revenue, sales volume, and price both before and after the granting of reserve status. When reserve status was granted, revenue, sales volume, and price levels did not change, but the slope of trends did change. Looking at the accompanying figures, it is not clear whether the change in slopes is a result of the policy. As price negotiations for the two examined drugs have not been completed yet, it is likely the full impact of the policy will be seen further in the future. In Figs. 2–3, the yellow line shows the date that reserve status was granted.

Fig. 2
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Price, revenue, and sales volume trends over time for cefiderocol compared to the date reserve status was granted.

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Fig. 3
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Price, revenue, and sales volume trends over time for avibactam/ceftazidime compared to the date reserve status was granted.

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Table 4 Interrupted time series analysis results considering the impact of reserve status on trends or revenue/sales/price levels.
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To what extent are Germany’s reforms helping to solve antimicrobial R&D?

The granting of reserve status has not had a positive impact on sales volumes or revenue yet.

As described above, the median “fair share” annual revenue target in Germany is approximately $27 million (25 million euros) per novel antimicrobial per year. If one assumes volumes of reserve antibiotics will not substantially increase, what unit prices would be required in order for Germany to achieve “fair share” revenue targets? Table 5 and Fig. 4 show the results of calculations for the two reserve drugs examined by this study. Average annual revenue is added to the $27 million (25 million euro) “fair share” and then divided by the median price per unit to get the target price per unit. At a minimum, Germany’s reforms would need to increase prices by 320–330% to achieve the same revenue impact as a delinked pull incentive on a volume-neutral basis. This finding is in line with a previous report by the Global AMR R&D Hub which found that similarly large price hikes would be needed across the world for a set of unidentified drugs to create the same amount of value as a pull incentive (Global AMR R&D Hub, 2021).

Fig. 4
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Comparison of current and “fair share” equivalent prices.

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Table 5 Comparison of two reserve antimicrobial prices with what prices would need to be to achieve “fair share” in Germany.
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Without price increases, revenue for each drug would never reach a “fair share” contribution for Germany. Table 6 shows projections for each reserve drug if they continue to have the same average monthly revenues over time. We used average monthly revenues over the study period to incorporate the seasonality of demand. This figure does not incorporate expectations of inflation rate changes. It can be expected that increases in consumer prices over time in Germany will make it take longer to reach the “fair share” value, while potential increases in the demand for these drugs beyond what is currently seen would make it easier to close the gap between revenue based on sales and a “fair share”-sized delinked pull incentive. That said, it would be unfortunate to base expectations for revenue on the prospect of demand increasing, as that would raise questions about increased resistance rates to these two drugs alongside increased use. This would be a turn of events that would run counter to an important goal of incentive proposals—to encourage the creation of new antimicrobials that can serve as backup lines of treatment when resistance makes existing treatments no longer effective. Cumulative revenue is calculated assuming a linear trend. The patent end is set at 10 years after EMA approval. Under these projections, none of the drugs will reach the 10-year German “fair share” cumulative revenues of $270 million (€250 million) before losing market exclusivity.

Table 6 Projections of future annual sales in Germany for reserve antimicrobials.
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Discussion

To date, German reimbursement reforms have not delivered sufficient revenues to meet “fair share” targets. At current volumes, each drug would need to see at least a 330% increase in price. During the time period that this study examined, the new reforms did not result in significantly more revenues. Alternatively, volumes would need to increase substantially, or there would need to be a combination of increased volume and price.

While some questions remain open (including the precise roles of public and private entities), a consensus has emerged in general support of pull incentives amongst G7 countries (Bennet et al., 2023; Council of Canadian Academies Expert Panel on Antimicrobial Availability, 2023; Ministry of Health Labour and Welfare, 2023; NHS England, 2023b; Public Health Agency of Sweden, 2024), the European Union (Directorate General for Health Emergency Preparedness and Response Authority (HERA) and European Health and Digital Executive Agency (HaDEA), 2022; European Observatory on Health Systems and Policies, 2023), and in many international fora (APEC Health Working Group, 2024; G7, 2022a; G20, 2023; Global AMR R&D Hub and Stakeholder Group, 2023; Global Leaders Group on Antibiotic Resistance, 2024).

Through its previous actions at the G20 and G7, as well as its many funding commitments to push incentives and AMR monitoring, Germany has long been a leader in the fight against AMR. As with other countries, Germany has also committed at the G7 to incentivizing antimicrobial development with a particular emphasis on pull incentives and has chosen to do that through enhanced reimbursement (G7, 2022b, 2021c). While the new elements of the German system are still in their early stages, at present the German system does not meet the “fair share” framework. If the German system is to achieve “fair share” within the next five or 10 years, what are the likely paths to success? First, allowing increased prices or sales volumes is possible, but doing so raises questions about the stewardship of new drugs, and the extent of price and volume changes needed would probably require further legislative or administrative changes. Second, Germany could embrace a delinked revenue guarantee, akin to what was recently proposed in Canada (Council of Canadian Academies Expert Panel on Antimicrobial Availability, 2023), providing a delinked incentive to “top up” revenues from the existing system. Finally, Germany could leave its domestic reimbursement unchanged but support a delinked antibiotic pull incentive operated by the European Union. The European Commission proposed a delinked incentive in 2023; the transferrable exclusivity voucher faced opposition and some member states are now supporting an alternative formulation based on revenue guarantees (Ardal et al., 2024).

Conclusion

Absent further action such as a substantial revenue guarantee or higher sales volumes, Germany will not achieve “fair share” targets for antibacterial innovation.