Phage therapy was researched by Félix d'Hérelle, a french-canadian scientist who was awarded the Leeuwenhoek Medal. Eli Lilly and Company were working on commercializing it in the U.S.

The problem was phage therapy couldn't stand up to a disruptive idea: the large scale production of penicillin in the mid-40's.

Didn't know that.

But I can see how it seemed that penicillin had solved that problem forever back then.

Indeed. While Flemming himself was concerned about resistance, penicillin is:

1) Much broader spectrum than phage preparations 2) Easier to manufacture in large quantities 3) Safer, because you don't need to filter the prep to remove endotoxins

It's basically a silver bullet - if you don't look too far in the future. It was incredibly disruptive.