Last week, the biotech company Achaogen announced that it was filing for bankruptcy. That might not seem like much news: businesses crash and burn all the time. But Achaogen, founded in 2002, was an antibiotics company. Its first drug, Zemdri (plazomicin), was approved by the Food and Drug Administration last June.
The world is running out of useful antibiotics because the rise of antibiotic resistance in bacteria is undermining them, and big firms are disinclined to make more. In 2018 alone, three large legacy pharma firms closed their antibiotic research programs. So the collapse of even a small business that stepped up to make a new antibiotic is a blow.
Achaogen hit all the marks that should have signaled success. It recruited experienced developers, targeted an infection that the World Health Organization considers a critical unmet need, stuck with its compound through 15 years of testing, scored several rounds of public investment and private philanthropy, and got its drug approved. Yet the market didn’t reward the company for producing a new antibiotic: on the day the FDA announced its decision, its stock price actually dropped by 20 percent. Almost a year later, it has earned less than $1 million on the drug, not enough to stay alive.