The fight against new, antibiotic-resistant strains of tuberculosis has already been lost in some parts of the world, according to a senior World Health Organisation expert. Figures show a 5% rise in the number of new cases of the highly infectious disease in the UK.

Dr Paul Nunn, co-ordinator of the WHO's global TB response team, is leading the efforts against multi-drug resistant TB (MDR-TB). Nunn said that, while TB is preventable and curable, a combination of bad management and misdiagnosis was leaving pharmaceutical companies struggling to keep up. Meanwhile, the disease kills millions every year.

"It occurs basically when the health system screws up," said Nunn. Treating TB requires a carefully followed regime of medication over six months. In places where health services are fragmented or underfunded, or patients poor and health professionals ill-trained, that treatment can fall short, which can in turn lead to patients developing drug-resistant strains. It's been estimated that an undiagnosed TB-infected person can infect 10 others a year.

"There's a vicious circle, because when new drugs come out they are expensive, so there is no demand. Without the volume of demand, the cost will not come down. If we can't tackle this, we are going to finish up with a lot more people being diagnosed with multi-drug resistant strains, which have already replaced previously drug-sensitive strains in Eastern Europe, and so we need a huge expansion of effort, especially in places like India and China." He added: "In some areas we have probably already lost the battle. Globally, it is still just 5% of the total number of TB cases, but with sloppy management of treatment we are moving towards an accelerating problem."

Tuberculosis is long thought to have lost out as donors preferred to fund HIV research and healthcare for children. "The absolute numbers were seen to be falling and TB seemed somehow to lose out and never had the profile of other health issues; it was the orphan child and just didn't get the same funding," said Nunn. But while there were few drugs on the horizon, new rapid diagnostic tests were a "wonderful" breakthrough.

It is 130 years since the German scientist Dr Robert Koch astounded the world by announcing that he had discovered the cause of tuberculosis, the TB bacillus. At the time TB was raging through Europe and the Americas, killing one in seven people. Today tuberculosis remains an epidemic in much of the world, causing the deaths of several million people each year, most of them in developing countries. The combination of HIV and TB has proved catastrophic. More than 350,000 people living with HIV died because of TB in 2010.

TB was once the biggest killer in Britain, but cases are now concentrated in London and among people not born in the UK. Provisional figures from the Health Protection Agency showed there were 9,042 new cases in 2011, compared with 8,587 in 2010. But Professor Ibrahim Abubakar, head of the TB section at the HPA, cautioned: "Despite the observed increase in TB cases in 2011, this provisional data should be interpreted with caution, because numbers are likely to change due to late notifications and de-notification of cases. It is therefore too early to determine whether this is a return to the upward trend of cases seen in the past two decades in the UK. TB continues to disproportionately affect those in hard to reach and vulnerable groups, particularly migrants, so it is crucial that we have specific strategies in place to address this."

The UK is also under pressure to restore funding to the Global Fund, first established to tackle what is often called the "big three" of HIV, malaria and TB. A $1.7bn (£1bn) reduction in funding to tackle TB over the next five years will affect the treatment of 3.4 million TB patients and could reverse gains made in tackling the disease, says new evidence released by three charities.

Results UK, the International HIV/Aids Alliance and the Stop Aids Campaign say they no longer have the resources to continue expanding their work. They are urging the UK to back emergency action to replenish the Global Fund at the G20 meeting in Mexico in June. The fund provides more than four-fifths of all funding to fight TB.

Aaron Oxley, of Results UK, said: "Thanks to sustained efforts from the Global Fund, TB cases have been in decline, but with the current lack of resources there is scope for severe backsliding on the progress we have made. This is disappointing and worrying news as we have a real chance of seeing an end to TB in our lifetime."

• Next week the UK will host the European Congress of Clinical Microbiology and Infectious Diseases. Scientists from around the world will discuss drug and multi-drug resistant TB strains and also look at what impact the crowds attending the London Olympics could have on spreading disease.

• This article was amended on 29 March 2012. The original said that Dr Paul Nunn is head of the WHO's global TB response team; it attributed a quote to him that undiagnosed TB cases infect 10 others; and also quoted him as saying that the battle against drug-resistant strains is lost in places such as the former Soviet Union. These have all been corrected.