Paul Herrling

Imagine a biotech company with too many promising drug candidates and not enough cash to pay for their development. It’s a problem that could be solved pretty quickly by any number of strategies: license some compounds, go public, or get acquired by a bigger firm.

But for companies working to find new medicines for diseases that affect the developing world, a full drug pipeline is both a blessing and a curse. When there’s no profit at the end of the road, it’s a stretch to pay for full-scale development of even one promising compound, let alone an entire portfolio of drug candidates. The question is not only how to decide which one goes forward but also how to justify not pushing all of them forward when so many people are afflicted by—and will die from—diseases like malaria and tuberculosis.

Paul Herrling, chairman of the board of the Novartis Institute for Tropical Diseases (NITD), the neglected-disease arm of the Swiss drug company, is trying to come up with ways to bring as many new drugs for neglected diseases to market as possible. Time is of the essence. If a drug gets stuck in the pipeline because of lack of funds, “the patients will have the bad luck,” Herrling says, shrugging his shoulders. “That’s life.”

To some observers, his words might sound cynical. But Herr­ling’s matter-of-fact explanation of the realities of the developing world belies his commitment to finding new drugs for neglected diseases.

In fact, if the Swiss executive has developed a certain cool remove when discussing the challenges of funding drugs for neglected diseases, his eyes light up when he talks about progress in discovering them. Novartis researchers have come up with three new approaches to treating malaria. Two of them are already in clinical studies, one of which, a spiroindolone that Novartis calls NITD609, is the first antimalarial compound with a novel mechanism of action to enter Phase II clinical trials in 20 years.

The NITD malaria drug candidates are part of a pipeline of more than 100 drugs and vaccines for neglected diseases that in the past decade have emerged from a variety of public-private partnerships, including NITD (which is a partnership with the Singapore Economic Development Board), Medicines for Malaria Venture, and the Global Alliance for TB Drug Development.

Not all will succeed. As Herrling points out, the attrition rate for drug development is the same whether a medicine is intended for the rich or the poor. “But there is now a sufficiently large pipeline that a few of these projects will need to go into full development, where costs go up exponentially,” he says.

So far, funding for the drugs has come from a mix of nonprofits and pharmaceutical companies. But those backers “seem to have difficulties in funding the full development,” Herrling says. Without a new model for how to pay for Phase III trials and registration with regulators, “there is a real danger some of this pipeline will be stalled because there are no funds.”

The funding gap is particularly acute for diseases such as malaria and tuberculosis, for which a new drug needs to be paired with other medicines to combat resistance. Assessing both the new compound and the combinations in patients is an expensive undertaking. For example, if NITD609 moves forward to Phase III, as is expected, the clinical trials would likely cost hundreds of millions of dollars, Herrling notes.

Industry is beholden to shareholders and can fund only so many trials without the promise of a financial return. Novartis, for example, devotes more resources to neglected diseases than many drug companies, but it has limits to how much money it will spend on such efforts. Nonprofits, meanwhile, have limited resources and would be hard-pressed to sink such a large sum into just one drug.

Herrling is trying to come up with solutions. He sees two distinct challenges to getting drugs for neglected diseases onto the market. The first is clear-cut: finding the money to pay for trials. The second is more subjective: ensuring the best projects in the overall pipeline are moving forward.

Next month, Herrling and a group of delegates from various countries will present to the World Health Organization (WHO) the results of a yearlong study of how best to address the first challenge. In response to a call, the committee received 109 proposals; it whittled them down and made general recommendations. Its main conclusion is that all countries should devote at least 0.01%—more for developed countries—of their gross domestic product to government-funded R&D related to health issues of the developing world. “We want all countries, including the poor ones, to take ownership of this,” Herrling says. “But on the other hand, it’s clear that everyone should participate according to their paying power.”

Herrling is also part of a team that submitted a proposal addressing the second challenge. Their Fund for R&D in Neglected Diseases would pool neglected-disease funding from all sources to enable the kind of science-based portfolio management that goes on in big pharma firms. Herrling argues that dispassionate management of the many drugs under development would eliminate duplication of effort and help cut out projects that get pushed forward for political rather than scientific reasons.

Now WHO member states will need to reach a consensus on how to move forward. It’s a process that “will take time,” Herrling says. “But any step we take in the right direction is worth it.”