Antibacterial Drug Development

Although the lack of development success is frustrating to physicians, patients, and payers, that only two new classes of antibiotics have been approved since 2000--the oxazolidone linezolid (Zyvox, from Pfizer Inc. ) and daptomycin (Cubicin, from Cubist Pharmaceuticals Inc. )—continues to be encouraging news to start-up companies. In some cases, new companies are being formed around Big Pharma assets that no longer fit their priorities and market needs: indeed, much of the focus of large-company antibacterial research remains the development of broad-spectrum agents against gram-positive bacteria such as methicillin-resistant Streptococcus aureus (MRSA) and streptococcal pneumonia. At the same time, the potentially large payoffs for success, in the form of collaboration dollars or acquisition, should keep deal values high even for successful niche players.

Pfizer set a new standard for buyouts last year. Intent on expanding its antibacterial franchise, it won the auction for...