Stronger 'superbugs,' and no new drugs to fight them

For nearly two years, a killer stalked the patients of Providence Alaska Medical Center.

It was a bacteria called Acinetobacter baumannii, a common cause of infections in hospitals. This one was different.

After a rash of mild cases in early 2011, doctors began seeing highly drug-resistant infections in patients, said Dr Megan Clancy, an infectious-disease specialist at the Anchorage, Alaska, hospital. And the bacteria was attacking more patients than just the severely ill ones who are the usual victims of drug-resistant "superbugs."

Related: Superbug victims and outbreaks

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Superbugs: Victims and outbreaks
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Superbugs: Victims and outbreaks
Kelly and Ryan Breaux stand holding a portrait of their deceased daughter Emma Breaux, at their home in Breaux Bridge, Louisiana, on June 16, 2016. The husband and wife lost twins, Emma and Talon, to different superbugs that they contracted while in the neonatal unit at Lafayette General Hospital. U.S. Picture taken June 16, 2016. TO MATCH SPECIAL REPORT USA-UNCOUNTED/SURVEILLANCE REUTERS/Edmund Fountain
Kelly and Ryan Breaux sit holding a portrait of their deceased daughter Emma Breaux in their home in Breaux Bridge, Louisiana, on June 16, 2016. The husband and wife lost twins, Emma and Talon, to different superbugs that they contracted while in the neonatal unit at Lafayette General Hospital. U.S. Picture taken June 16, 2016. TO MATCH SPECIAL REPORT USA-UNCOUNTED/SURVEILLANCE REUTERS/Edmund Fountain
Four-year-old Luke Reimer, of Batavia, Illinois, holds a photograph, June 18, 2009, of his twin sister Madeline who died after being born with MRSA (Methicillin resistant Staphylococcus aureus), a bacterium that is resistant to many antibiotics. (Photo by Chuck Berman/Chicago Tribune/MCT via Getty Images)
Stephanie Hall (L), sits on the couch with her sister, Crystal Silva (R), and their ten year old niece Destini and nephew Kane in El Paso, Texas, U.S. on July 2, 2016. The children's mother, Natalie Silva, contracted Methicillin-resistant Staphylococcus aureus, more commonly known as MRSA, a skin infection that can turn fatal once it enters the bloodstream, when she went to the hospital to deliver Kane. After a 10 month battle with MRSA, Silva died, leaving Hall and the family to raise the two children. TO MATCH SPECIAL REPORT USA-UNCOUNTED/SURVEILLANCE REUTERS/Dan Dalstra
Monica Berckes, poses with the funeral program of her late mother Marianne Rumsey, who died at 61, several months after contracting MRSA during heart surgery, at her home in Secaucus, New Jersey, June 2, 2016. Picture taken June 2, 2016. TO MATCH SPECIAL REPORT USA-UNCOUNTED/SURVEILLANCE REUTERS/Mike Segar
Zachary Rubin (C), medical director of clinical epidemiology and infection prevention, and Robert Cherry (R), chief medical and quality officer for UCLA Health System, attend a news conference by UCLA Health System and county officials at the Ronald Reagan UCLA Medical Center in Los Angeles, California February 19, 2015. The large Los Angeles teaching hospital has told scores of patients they were possibly exposed to a drug-resistant bacterial "superbug" during endoscopy procedures that infected seven patients and may have contributed to two deaths. REUTERS/Jonathan Alcorn (UNITED STATES - Tags: HEALTH DISASTER)
A sample bottle containing E. coli bacteria is seen at the Health Protection Agency in north London March 9, 2011. For decades scientists have managed to develop new medicines to stay at least one step ahead of the ever-mutating enemy, bacteria. Now, though, we may be running out of road. Methicillin-resistant Staphylococcus aureus, commonly known as MRSA, alone is estimated to kill around 19,000 people every year in the United States -- far more than HIV and AIDS -- and a similar number in Europe, and other drug-resistant superbugs are spreading. Picture taken March 9, 2011. To match Special Report ANTIBIOTICS/ REUTERS/Suzanne Plunkett (BRITAIN - Tags: HEALTH SCI TECH)
An employee displays MRSA (Methicillin-resistant Staphylococcus aureus) bacteria strain inside a petri dish containing agar jelly for bacterial culture in a microbiological laboratory in Berlin March 1, 2008. MRSA is a drug-resistant "superbug", which can cause deadly infections. REUTERS/Fabrizio Bensch (GERMANY)
A view of the UCLA Medical Center in Los Angeles, California March 19, 2015. UCLA, the hospital at the center of the "superbug" outbreak that killed two people and infected seven last month has received poor patient safety scores and had its payments cut by Medicare for high rates of hospital-acquired infections. REUTERS/Lucy Nicholson
This digitally-colorized scanning electron micrograph depicts four magenta-colored, spherical methicillin-resistant Staphylococcus aureus (MRSA) bacteria in the process of being phagocytized by a blue-colored human white blood cells in this undated handout photo. TO MATCH SPECIAL REPORT USA-UNCOUNTED/SURVEILLANCE National Institute of Allergy and Infectious Diseases (NIAID)/Handout via REUTERS ATTENTION EDITORS - THIS IMAGE WAS PROVIDED BY A THIRD PARTY. EDITORIAL USE ONLYONLY
MIAMI - OCTOBER 17: Miami VA Medical Center hospital registered nurse, Rafael Sepulveda, pulls on rubber gloves while attending to patients in the Emergency room October 17, 2007 in Miami, Florida. The hospital has strict policies in place to ensure that the staff uses procedures in the fight against methicillin-resistant Staphylococcus aureus bacteria, commonly referred to as MRSA. The staph bacterium is resistant to most common antibiotics and has been responsible for more than nearly 19,000 deaths each year, according to the Centers for Disease Control and Prevention (Photo by Joe Raedle/Getty Images)
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Clancy took emergency measures. Infected patients were isolated. Staff and visitors had to adhere to strict hand-washing and other infection-control protocols. Furniture and equipment were scrubbed to remove a microbe that can stubbornly persist on all sorts of surfaces.

Clancy also contacted outside researchers for help. They found that a strain of the bacteria had acquired a rare combination of traits. Bacteria typically are either highly resistant to drugs or highly virulent. This strain was both. Doctors quickly burned through the antibiotics used as the second and third lines of defense against superbugs. This strain shook them off.

"When you start running out of medications, it gets pretty desperate," Clancy said.

LAST RESORT

Eventually, they turned to colistin. This powerful antibiotic was largely abandoned in the 1960s for its toxic side effects. Out of necessity, it has become in recent years a weapon of last resort against the worsening superbug scourge.

But in some of the Alaska cases, even colistin didn't work. For public health officials, that's the nightmare scenario.

"It's the worst of all possible worlds: You have a bacteria that is good at establishing infection, and it can't be treated with antibiotics," said Dr Robert Clifford, a microbiologist at the Walter Reed Army Institute of Research who studied the outbreak.

In early 2013, the infections stopped as mysteriously as they had begun. By then, the virulent strain had infected 19 patients and contributed to the deaths of five of them. A sixth died after contracting another highly resistant A. baumannii strain.

The Alaska outbreak, and others like it that make headlines with increasing frequency, illustrate a major weakness in the fight against superbugs: The arsenal of antibiotics is nearly empty. And significant financial and legal hurdles are getting in the way of the already challenging process of discovering effective new ones.

Related: Antibiotic-resistant germs

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Antibiotic-Resistant Germs
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Antibiotic-Resistant Germs
In this undated photo provided by the Centers for Disease Control and Prevention is one form of CRE bacteria, sometimes called ânightmare bacteria.â CRE bacteria is blamed for 600 deaths each year, and can withstand treatment from virtually every type of antibiotic. (Photo via CDC)
Enterococcus, Sem, Vancomycin Resistant Enterococci, Vre, Common Infections Caused By Enterococci Are Urinary Tract Infections And Wound Infections. (Photo By BSIP/UIG via Getty Images)
Scanning Electron Micrograph of Burkholderia cepacia. (Photo by: Media for Medical/UIG via Getty Images)
Methicillin Resistant Golden Staph Staphylococcus Aureus Mrsa, Scanning Electron Micrograph Colorized Sem, X 9560, The Line Represents Two Microns. These Bacteria Are Gram Positive Cocci And Facultative Anaerobes That Typically Gather In Clusters, As We See It Here. Golden Staph Is Responsible For Food Poisoning, Cutaneous Infections, Pneumonia, Toxic Shock Syndrome, . . . The Mrsa Is One Of The Most Frequent Multiresistant Bacterial Strains In Healthcare Facilities Hospital Acquired Infections. Golden Staph Staphylococcus Aureus > Staphylococcus > Staphylococcaceae > Bacillales > Firmicutes > Bacterium. This 2005 Scanning Electron Micrograph Sem Depicted Numerous Clumps Of Methicillin Resistant Staphylococcus Aureus Bacteria, Commonly Referred To By The Acronym, Mrsa; Magnified 9560X. Recently Recognized Outbreaks, Or Clusters Of Mrsa In Community Settings Have Been Associated With Strains That Have Some Unique Microbiologic And Genetic Properties, Compared With The Traditional Hospital Based Mrsa Strains, Which Suggests Some Biologic Properties, E. G. , Virulence Factors Like Toxins, May Allow The Community Strains To Spread More Easily, Or Cause More Skin Disease. A Common Strain Named Usa300 0114 Has Caused Many Such Outbreaks In The United States. Methicillin Resistant Staphylococcus Aureus Infections, E. G. , Bloodstream, Pneumonia, Bone Infections, Occur Most Frequently Among Persons In Hospitals And Healthcare Facilities, Including Nursing Homes, And Dialysis Centers. Those Who Acquire A Mrsa Infection Usually Have A Weakened Immune System, However, The Manifestation Of Mrsa Infections That Are Acquired By Otherwise Healthy Individuals, Who Have Not Been Recently Hospitalized, Or Had A Medical Procedure Such As Dialysis, Or Surgery, First Began To Emerged In The Mid To Late 1990's. These Infections In The Community Are Usually Manifested As Minor Skin Infectio (Photo By BSIP/UIG Via Getty Images)
Staphylococcus Aureus Sem, Resistant to Antibiotics Including Methicillin And Other More Common Antibiotics Such As Oxacillin, Penicillin And Amoxicillin, While 25 To 30 percent Of Population Is Colonized With Staph, Approximately 1 percent Is Colonized With Mrsa. (Photo By BSIP/UIG via Getty Images)
Methicillin Resistant Golden Staph Staphylococcus Aureus Mrsa, Scanning Electron Micrograph Colorized Sem, X 9560, The Line Represents Two Microns. These Bacteria Are Gram Positive Cocci And Facultative Anaerobes That Typically Gather In Clusters, As We See It Here. Golden Staph Is Responsible For Food Poisoning, Cutaneous Infections, Pneumonia, Toxic Shock Syndrome, . . . The Mrsa Is One Of The Most Frequent Multiresistant Bacterial Strains In Healthcare Facilities Hospital Acquired Infections. Golden Staph Staphylococcus Aureus > Staphylococcus > Staphylococcaceae > Bacillales > Firmicutes > Bacterium. This 2005 Scanning Electron Micrograph Sem Depicted Numerous Clumps Of Methicillin Resistant Staphylococcus Aureus Bacteria, Commonly Referred To By The Acronym, Mrsa; Magnified 9560X. Recently Recognized Outbreaks, Or Clusters Of Mrsa In Community Settings Have Been Associated With Strains That Have Some Unique Microbiologic And Genetic Properties, Compared With The Traditional Hospital Based Mrsa Strains, Which Suggests Some Biologic Properties, E. G. , Virulence Factors Like Toxins, May Allow The Community Strains To Spread More Easily, Or Cause More Skin Disease. A Common Strain Named Usa300 0114 Has Caused Many Such Outbreaks In The United States. Methicillin Resistant Staphylococcus Aureus Infections, E. G. , Bloodstream, Pneumonia, Bone Infections, Occur Most Frequently Among Persons In Hospitals And Healthcare Facilities, Including Nursing Homes, And Dialysis Centers. Those Who Acquire A Mrsa Infection Usually Have A Weakened Immune System, However, The Manifestation Of Mrsa Infections That Are Acquired By Otherwise Healthy Individuals, Who Have Not Been Recently Hospitalized, Or Had A Medical Procedure Such As Dialysis, Or Surgery, First Began To Emerged In The Mid To Late 1990's. These Infections In The Community Are Usually Manifested As Minor Skin Infectio (Photo By BSIP/UIG Via Getty Images)
Methicillin Resistant Staphylococcus Aureus Mrsa Bacteria. This Scanning Electron Micrograph Depicts A Grouping Of Methicillin Resistant Staphylococcus Aureus Mrsa Bacteria. These S. Aureus Bacteria Are Methicillin Resistant, And Are From One Of The First Isolates In The U. S. That Showed Increased Resistance To Vancomycin As Well. Note The Increase In Cell Wall Material Seen As Clumps On The Organisms’ Surface. (Photo By BSIP/UIG Via Getty Images)
Antibiotic drugs being tested to see how resistant they are to bacteria
BOSTON - APRIL 8: A scientist uses a 96-well plate to test different concentrations of nano particle treatment for antibiotic resistant bacteria inside the Egan Research Center at Northeastern University in Boston on April 8, 2014. The stronger the glow, the stronger the bacteria are. (Photo by Jessica Rinaldi/The Boston Globe via Getty Images)
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It's been 30 years since the discovery of a new class of antibiotic that has hit the market. Each class is defined by its chemical structure, which determines how it kills bacteria. The longer an antibiotic is in use, the more time bacteria have to develop resistance to it. Penicillin and its ilk date back to World War Two, and resistance to this group is now widespread, as it is becoming for other extant classes.

Thirty-seven antibiotics are currently undergoing clinical trials, according to the Pew Charitable Trusts, which keeps track of the U.S. pipeline. Most, however, are based on existing drugs. While these derivatives are cheaper and easier to develop than new classes of drugs, bacteria have a head start in developing resistance to them.

Further, most drugs in the pipeline target so-called Gram-positive bacteria, a group that includes the well-known superbug methicillin-resistant Staphylococcus aureus (MRSA). But recently, the main emerging threats have come from the group known as Gram negatives, which are harder to treat because they are encased in tough membranes that repel many drugs. Among them: the lethal Acinetobacter that hit the Providence Alaska Medical Center.

That's why colistin has seen a resurgence in use. It is effective in particular against Gram-negative bacteria. Prescriptions of the drug dispensed by long-term care facilities and retail and online pharmacies increased 74 percent from 6,513 in 2005 to 11,322 in 2015, according to a Reuters analysis of data provided by QuintilesIMS, a healthcare research and services company in Durham, North Carolina. And those numbers don't include prescriptions at regular acute-care hospitals.

Now, as happened in Alaska, doctors are encountering superbugs that are developing resistance to colistin, too.

"We are losing the standoff with pathogens," said antibiotic researcher Kim Lewis, a Northeastern University biochemist. "Without antibiotics, essentially you do not have modern medicine."

STUCK IN THE PIPELINE

On a bright summer day in June 2000, William DeGrado sketched a ribbon-like molecule on a piece of scrap paper.

It may not have looked like much, but it so excited the biochemist and his team of fellow researchers at the University of Pennsylvania in Philadelphia that they all signed the sketch and set to work building the molecule in a laboratory.

The source of their excitement was the molecule's resemblance to antimicrobial peptides, or AMPs. These tiny proteins are produced by the body's own tissues as a first line of defense against all sorts of infections. AMPs don't have to enter a pathogen to kill it - they literally punch holes through bacteria cell walls. That means they can kill both Gram-positive and thick-skinned Gram-negative bugs.

Scientists have long recognized the potential of AMPs. But previous efforts to turn the proteins into effective drugs failed: The products were too costly, too toxic or too chemically unstable. DeGrado's sketch suggested it was possible to create a synthetic version of an AMP without those drawbacks.

"I thought, if it works, we've got a simple drug that would be cheap to make that could go to the developing world and cure all sorts of things," said Michael Klein, a computational chemist who was tasked with creating computer models of the molecule.

Within two years, they had formed a company, called PolyMedix, and raised a few million dollars in funding from NIH grants and private investors. Soon after, they obtained patents and published their first scientific paper on the potential of their new drug, eventually called brilacidin.

In early lab tests, the molecule showed potency against bacteria known for resistance to powerful drugs, including Gram positives and well-known Gram-negative killers Klebsiella pneumoniae and Escherichia coli. Even more encouraging, testing showed bacteria had little propensity to acquire resistance to the drug.

BURNING THROUGH CASH

As they barreled toward clinical trials to test the safety and efficacy of the drug, they raised more money by getting PolyMedix listed on the over-the-counter market. "We believe it is less likely that resistance will develop against our product candidates compared with conventional antibiotic drugs," the company told investors in 2006.

But the company was burning through cash. By 2012, after the first phase II trials of brilacidin, PolyMedix had accumulated a $96 million deficit, according to regulatory filings.

Investors grew impatient with the slow pace of the trials and the fact that the drug proved more effective against Gram-positive infections than harder-to-kill Gram negatives, said Richard Scott, a PolyMedix founder.

On April 1, 2013, after defaulting on a loan, PolyMedix declared bankruptcy. "It just didn't work, given the reality of having to make progress in very short time periods (to offer) a return on investment," Scott said.

Another small biotechnology company, Cellceutix Corp , paid $5 million in cash and stock for PolyMedix's assets.

Cellceutix is housed in the first floor of a nondescript gray building in the back of an office park in Beverly, Massachusetts, near Boston - a far cry from the sprawling research centers Big Pharma operates. On a recent November day, just eight people were at work, out of total staff of 18.

In 2014, Cellceutix completed a second phase II trial of brilacidin. It found that a single dose of the drug was as effective against MRSA as a weeklong course of daptomycin, a popular antibiotic widely used in hospitals against the superbug.

A phase III trial - typically larger and more expensive than earlier trials - has been planned for more than a year now. But the company needs $30 million to move forward, chief scientist Krishna Menon said. It's also seeking a special assessment from the FDA to speed up the trial and approval process. "We have the contractors, the medicine, the vials all ready!" Menon said. "Everything is set."

Investors, however, haven't shown much interest in advancing the process. Some sued the company last year, alleging that Cellceutix misled them about the potency of brilacidin against Gram-negative bugs. A judge in federal court in Manhattan threw out the case last June, but the damage was done. Shares of Cellceutix have dropped to around $1.15 from more than $4.50 after the successful phase II trial.

Meanwhile, scientific interest in the potential of AMPs has only grown. A Ph.D student in Australia made international headlines in September after she created an AMP-based molecule that has the potential to kill Gram-negative pathogens, including those resistant to colistin. But the research is still in its earliest stages and far from clinical trials.

A BUILT-IN DOWNSIDE

Resistance can develop fast, and is made worse through over-prescribing and misuse of drugs. To preserve existing antibiotics, public health officials have urged hospitals and doctors to implement "stewardship" programs to reduce unnecessary prescriptions and hold critical drugs in reserve for when others fail.

Beginning Jan. 1, 2017, the Joint Commission, the nonprofit group that accredits U.S. healthcare facilities, will require hospitals and nursing care centers to implement stewardship programs. And the Centers for Medicare & Medicaid Services proposed a rule in June that would require hospitals to have stewardship programs to participate in the two huge government insurance programs it administers. In 2014, California became the first state to enact a law that mandates stewardship programs.

Suburban Hospital, in Bethesda, Maryland, adopted a stewardship program in July 2015 to comply with new Joint Commission standards. In the first year, the hospital's antibiotic use fell about 7 percent, said Julie Trivedi, hospital epidemiologist and director of antimicrobial stewardship. That saved the hospital nearly $200,000 on antimicrobial drugs.

"Infectious disease is not like cardiology, where the latest drug on the market is the one you want to use," Trivedi said. "Infectious disease physicians drive that beat-up Beetle until the car falls apart  It's about utilizing the available drugs before moving on to new drugs."

GlaxoSmithKline's most promising experimental antibiotic, gepotidacin, is now in phase II clinical trials. If approved, it will be used as a last resort against superbugs. The company has been able to shepherd the drug through expensive research and clinical trials with support from the federal Barda program, said David Payne, head of GlaxoSmithKline's Antibacterial Discovery Performance Unit.

But, he said, since the drug should be used only when it's "desperately needed ... that creates a huge challenge in creating a viable return on investment." He said the company has invested roughly $1 billion in antibiotic research over the past decade.

PAY DIRT

In early 2015, researchers Kim Lewis and Slava Epstein at Northeastern University in Boston published an article in the journal Nature announcing the discovery of teixobactin, a compound that appeared to kill Gram-positive bacteria without any indications of resistance.

Major media carried the news. The New York Times wrote that teixobactin could "help solve an urgent global problem" by ushering in a new class of antibiotic for the first time in decades.

Since then, NovoBiotic Pharmaceuticals LLC, the Cambridge, Massachusetts, company the researchers founded to commercialize their products, has been receiving letters and emails from people around the world.

"I have chronic urinary tract infection, and would like to know when will be available teixobactin for sale?" wrote a patient from Brazil. Another, from Romania, wrote: "I have some big problems in my life because of staphylococcus aureus ... I would like to participate in a program for testing."

"It's really sad," said NovoBiotic President Dallas Hughes, "because I have to tell them we are two years away from clinical trials." The company's researchers are still tinkering with how the drug dissolves in blood, to make it suitable for use in humans.

The excitement surrounding teixobactin isn't just about its potential to kill bacteria. It's also about how the compound was isolated - from a soil microbe that could not previously be studied because it could not be grown in a lab.

Lewis and Epstein invented a way to cultivate it and other previously out-of-reach soil and marine bacteria. Developed in Epstein's lab, the isolation chip, or "iChip," holds out the promise of unearthing all sorts of natural compounds that could be turned into life-saving drugs.

STUCK IN THE GROUND

That innovation, which is patented, addresses a fundamental issue that for decades has hindered development of new classes of antibiotics.

Bacteria started showing resistance to penicillin as early as 1940 - just 12 years after the drug's discovery, and even before it was mass-produced to treat British and U.S. troops during World War Two. That didn't cause much concern. New classes of antibiotics were regularly coming to market, derived mostly from compounds produced by bacteria.

But by the 1980s, scientists had pretty much exhausted the supply of available compounds. Untold multitudes of potentially beneficial compounds were locked away in bacteria that couldn't be grown in a lab. That's a major reason why Big Pharma started exiting antibiotic research in the 1980s, and why most investment today goes toward developing drugs that are analogs of old ones.

The iChip gets around the problem. Volunteers from across the United States send soil to NovoBiotic to help its scientists find new medicines. On a shelf in a back room of the company's single-floor premises sit dozens of clear plastic bags of soil, each labeled by location: "Jackson Falls, woods edge, New Hampshire," "Warwick, RI, woods."

So far, NovoBiotic has isolated more than two dozen compounds using iChip technology, though only teixobactin and one other are being developed as possible drug candidates.

With teixobactin and the iChip, NovoBiotic has also attracted $35 million from angel investors and through grants from the Bill and Melinda Gates Foundation and the NIH.

But while NovoBiotic is benefiting from the federal government's efforts to promote drug development, it and other biotech companies are also confronting a new legal impediment.

Two U.S. Supreme Court rulings, in 2012 and 2013, have made it harder to patent products derived from nature. The cases dealt with patent protection for human genes and blood products. But the court's decisions have been interpreted more broadly to limit intellectual property rights on all sorts of natural phenomena, including chemicals with antibiotic properties.

About 70 percent of the bacteria-fighting drugs approved worldwide since 1981 are natural products or derived from them, according to David Newman, former chief of the natural products branch at the National Cancer Institute, who continues to publish studies on the topic.

But since 2014, the U.S. Patent and Trademark Office has been rejecting applications for patents on natural products.

A patent allows for a limited time period of exclusive sales during which investors and companies can recoup their development costs. Without a patent, "anyone and your uncle can make the drug and sell it for less, so why take it to market?" said Ronald Evens, a researcher at the Tufts Center for the Study of Drug Development.

In NovoBiotic's first attempt to patent teixobactin, in 2014, the patent office said it was "an isolated compound from nature" and not eligible for protection. The agency allowed NovoBiotic to patent only the method of treating patients, according to documents reviewed by Reuters.

That means the company holds a patent on specific uses, like administering the drug at a certain dosage, intravenously, for MRSA.

The company in August obtained a second teixobactin-related patent, this time as a "pharmaceutical composition," incorporating other ingredients mixed with the drug itself.

Such patents offer less protection from rivals that design a drug based on the same natural compound but using different mixtures and treatment methods. "Under these circumstances, if someone were to make just the compound, they would not infringe" on the patent, said biotechnology patent lawyer Kevin Noonan, a partner at Chicago-based firm McDonnell Boehnen Hulbert & Berghoff.

TOO MUCH LIKE NATURE

Some lawyers and doctors argue that fewer protections could promote scientific research by eliminating the monopolies patents create. But for biotech companies like NovoBiotic, the difficulty of obtaining patents on natural compounds could be problematic for drug development.

Brilacidin, the drug that Cellceutix is working on, is safe. It was patented before the rulings, and besides, it isn't a natural compound but merely mimics one. But rejections are hitting others seeking to patent AMPs or close copies of them.

In August, the U.S. Patent and Trademark Office rejected an application by a medical research arm of a foundation associated with German auto supplier Robert Bosch Gmbh to patent a fragment of a human AMP called defensin. In its application, the foundation cited its own research showing that the molecule was effective against Gram-negative and Gram-positive bacteria, non-toxic and easy to manufacture.

The patent officer examining the case said it was not "markedly different from what exists in nature."

Federal courts are in accord with the patent office. In six of seven cases in which natural products or diagnostic tests were at issue since 2012, courts have either canceled or rejected the patents. The Supreme Court has signaled its agreement with the trend so far, declining to review one case that had been appealed to the high court earlier this year.

"Research and development is complex, risky and expensive," said Corey Salsberg, head of intellectual property policy at Novartis, who wrote a brief for the Supreme Court on the topic. By restricting what drugs can be patented, he says, "you're telling companies  'Don't bother putting your resources here.'"

(Reporting by Andrew Chung in Boston, Yasmeen Abutaleb in San Francisco and Deborah J. Nelson in Washington. Additional reporting by Ryan McNeill in New York. Edited by John Blanton)

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