VDP-17: CrowdFundedCures.org Partnership Proposal - Generic Drug Repurposing Social Impact Bond

Description: What is the project?

Crowd Funded Cures’ mission is to implement pay-for-success smart contracts (an on-chain version of Social Impact Bonds or SIBs) to incentivise repurposing of generic drugs. The SIB mechanism incentivises impact investors (such as VitaDAO token holders) to fund IPNFTs holding encrypted Phase II/III randomised controlled trial (RCT) data to sell to payers in exchange for outcome payments or a subsidized price for the newly labelled generic from a generic drug repurposing fund if the RCT is successful and/or the repurposed generic obtains regulatory approval. The fund can also be crowdfunded from the public using disease-specific NFTs or backed by payers such as governments, health insurers, or large philanthropy.

In this VDP we propose to provide $40,000 of funding to Crowd Funded Cures to commission a feasibility study from Guidehouse or another leading consulting firm on this new model of research funding (“generic drug and nutraceutical repurposing pay-for-success contracts”) to kickstart potential future mechanisms that VitaDAO could support in the future.

Problem: What problem is this solving? Why?

There are over 20,000 generic drugs with FDA approval and even more nutraceuticals which lack private incentives for repurposing because it is impossible to enforce a monopoly price if the drug is available for a large off-patent indication, which means it is not possible to prevent off-label competition. In essence, dosing information about which generic drugs work for new indications, in which patients, and at which stage of a disease, is a non-rivalrous and non-excludable public good which causes a “tragedy of the commons”.

Most known longevity drugs are also generic or off-patent (e.g. metformin, rapamycin, resveratrol, NMN etc), without evidence from large RCTs to determine optimal safety and efficacy due to this market failure. Public and philanthropic grant funding for generic drug repurposing suffers from many disadvantages, including centralisation, inefficiency, lack of innovation, exposure to risk of RCT failure and risk of cronyism and nepotism.

By contrast, pay-for-success does not suffer from these disadvantages. In particular, it is decentralised / meritocratic, transfers risk of RCT failure from payers to impact investors who are willing to bear this risk, and leverages market forces, with impact investors most likely to fund successful RCTs - forming syndicates and/or aggregating VITA tokens - which increases their value.

Success: How do we know if we’ve solved this problem?

Establishing the world’s first pilot pay-for-success (PFS) smart contract using IPNFTs to incentivise repurposing of generic drugs to treat a specific disease (e.g. Covid, longevity, pancreatic cancer) and raise impact investor funds of $1-10m to conduct Phase 2 or 3 RCT data encrypted as a trade secret in the IPNFT until unlocked by payers. Launch to wider community to obtain syndicate of payers or crowdfund outcome payment fund or advance market commitments $10-50m. After the pilot PFS / IPNFT smart contract validates the concept, expand into new use cases/diseases and raise larger fund from payers (e.g. health insurers, govts, philanthropy, community - $10-100m).

When: When does it ship and what are the milestones?

  • Nov 2021 - Jan 2022 - Launch of pilot pay-for-success smart contract and NFT fundraiser with associated public good medicine IPNFTs available for investment by VitaDAO community.

  • Jan - May 2022 - publication of Guidehouse Feasibility Study with financial model to support payer backing for pay-for-success model on the basis of health impact and drug cost savings.

  • Jan - June 2022 - conduct fundraising campaign for public and payer backing of NFT fund for generic drug repurposing in specific disease class (e.g. longevity, Covid etc). Target $5m to incentivise successful Phase 2 RCT and $10-15m to incentivise Phase 3 clinical trials and obtain regulatory approval for new indication.

Budget

  • $40k to support Guidehouse Feasibility Study to payers to back a pay for success contract on the basis of overall costs savings or lower costs per quality-adjusted life year (QALY) compared with patented drugs.

  • To be determined (another vote will be needed to authorize the allocation of additional funds) - time and materials to support development of pilot generic drug and nutraceutical repurposing pay-for-success smart contract, open source medicine IPNFT, and Results Oracle linking to RCT data provided by independent CRO.

Team Members

  • Agree
  • Agree with revisions (please comment)
  • Disagree

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7 Likes

I like this concept, I just have a clarifying question:

$40k to support Guidehouse Feasibility Study to payers to back a pay for success contract on the basis of overall costs savings or lower costs per quality-adjusted life year (QALY) compared with patented drugs.

I’m not clear on what the DAO will have access to based on this $40k will the DAO own some particular IPNFT?

  • Nov 2021 - Jan 2022 - Launch of pilot pay-for-success smart contract and NFT fundraiser with associated public good medicine IPNFTs available for investment by VitaDAO community.

This makes it sound like there would be another proposal in the future for DAO investment? Or is this specifically what we are talking about in this proposal and the $40k will be in exchange for one of the "public good medicine IPNFTs "?

3 Likes

Hi Ben, thanks for your question.

I’m not clear on what the DAO will have access to based on this $40k will the DAO own some particular IPNFT?

To clarify, the feasibility study is not to fund specific clinical trials or scientific research, but it will provide the pharmacoeconomic analysis to support the financial model to fund off-patent clinical trials in the future using a pay for success model. It will however, reference certain generic drug use cases (including ideally, an off-patent drug to treat longevity) and show how this will save costs for a pharmaceutical payer (e.g. health insurer, government, philanthropy, public etc) if they agree to purchase off-patent RCT data in the future as part of a pay for success contract. Using the feasibility study, we can then try to convince a syndicate of payers to sign a pay for success contract - this is essential for it to be commercially viable to fund the repurposing of generic drugs, because patents cannot enforce a monopoly price. Then VitaDAO can raise funds for repurposing off-patent longevity drugs in an IPNFT.

The reason we would like to use Guidehouse is they were the public consulting arm of PwC, and have good connections with payers, particularly in the US. They also have 8k consultants and access to pharmacoeconomic and financial modelling expertise. Typically, for a new project, it is important to have a feasibility study to show it is financially viable.

This makes it sound like there would be another proposal in the future for DAO investment? Or is this specifically what we are talking about in this proposal and the $40k will be in exchange for one of the "public good medicine IPNFTs "?

Yes, this will be for a future investment proposal to build an MVP of the pay for success contract infrastructure (including a CRO oracle), which will allow the raising of funds for a generic drug repurposing IPNFT. It is about laying the foundations to establish a new scalable financial model for developing new therapeutics without relying on patents. The fundraising itself for the Generic Drug Repurposing IPNFTs (e.g. which could include specific longevity interventions through VitaDAO or other biomedical IPNFTs through Molecule’s platform) will be separate and on a project-by-project basis. This is more about developing the necessary infrastructure to allow this to happen.

3 Likes

Thank you @Savva is there someway we could include some language along the lines of VitaDAO will have some kind of option on the first IPNFT that comes from this at some agreed to discount (or some other forward looking benefit)? This sounds extremely beneficial to the community at large, but I ideally would like to see some financial dimension that encapsulates the benefit to VitaDAO.

2 Likes

No worries @Ben

I think it’s almost guaranteed that the first Generic Drug Repurposing IPNFT related to longevity will be launched through the VitaDAO platform. Molecule are the only service provider of IPNFTs as far as I am aware and VitaDAO is the leading biopharma project in the web3 space. And the intention is to build the pay for success smart contract MVP by leveraging on Molecule’s tech stack.

However, I’m not sure how enforceable an option would be for a discount over a future Generic Longevity Drug Repurposing IPNFT as it’s not clear what the generic use case would be. I assume it would need to occur via VitaDAOs platform anyway unless we can bridge VITA to other exchanges or platforms. I’d be happy to include some language in the VDP that the intention is for VITA token holders to get a discount (e.g. 15%) when backing a Generic Longevity Drug Repurposing IPNFT via VitaDAO platform, but it’s not clear how else they would be able to contribute. Although it is possible we would have a crowdfunding platform via our website or try to raise from other sources, so I understand the benefit of perhaps offering a discount to people using VITA to contribute, as opposed, to say, via the Gitcoin or some other platform.

Please let me know what you think.

2 Likes

However, I’m not sure how enforceable an option would be for a discount over a future Generic Longevity Drug Repurposing IPNFT as it’s not clear what the generic use case would be. I assume it would need to occur via VitaDAOs platform anyway unless we can bridge VITA to other exchanges or platforms. I’d be happy to include some language in the VDP that the intention is for VITA token holders to get a discount (e.g. 15%) when backing a Generic Longevity Drug Repurposing IPNFT via VitaDAO platform, but it’s not clear how else they would be able to contribute.

I definitely agree the enforceability is unclear, similar to the relationship we have around any IP that would be generated from a research program.

The question I’m trying to answer is what makes this funding appropriate for VitaDAO rather than the Gitcoin Round that is taking place? As I read it, this funding seems to be more of a donation.

IMO for the proposal going on chain, if it is more of a donation, it would be good to make clear that this is essentially a donation, however by funding this work we are potentially seeding opportunities in the future that VitaDAO could invest in for a return.

2 Likes

The IP generated from a specific research program is a bit different, because this could lead to some patentable clinical trial data. Whereas this project is about paying for a feasibility study to establish a new kind of model for drug development, that also leverages IPNFTs / smart contracts to develop a market incentive for development of public good medicines without reliance on patents.

You could think of it like a grant or donation, but it’s about validating a particular financial model, that will improve VitaDAO / Molecule’s platform / tech stack, and then ultimately, allow Vitalians to support a future Generic Longevity Drug Repurposing IPNFT, which will benefit VitaDAO and broader community. There is some IP there, you could think of it like IP generated in a report that benefits VitaDAO.

Crowd Funded Cures are also keen to support longevity research, as this will have a massive impact on reducing global disease burden. And we also have received a lot of feedback from within the longevity community that the lack of private incentives to repurpose generic drugs to treat longevity are creating barriers to scientific progress (e.g. TAME trial struggling to raise public / philanthropic funding). So new more decentralised and meritocratic financial models are needed that can leverage the power of the markets to allocate resources in an efficient way. We do see this as part of developing a broader infrastructure and what will eventually lead to VitaDAO being able to help develop Open Source Longevity Medicines, which I assume is an option many VITA holders would like to have.

2 Likes

Perhaps we could expand the top level summary:

Description: What is the project?

Crowd Funded Cures’ mission is to implement pay-for-success smart contracts (an on-chain version of Social Impact Bonds or SIBs) to incentivise repurposing of generic drugs. The SIB mechanism incentivises impact investors (such as VitaDAO token holders) to fund IPNFTs holding encrypted Phase II/III randomised controlled trial (RCT) data to sell to payers in exchange for outcome payments or a subsidized price for the newly labelled generic from a generic drug repurposing fund if the RCT is successful and/or the repurposed generic obtains regulatory approval. The fund can also be crowdfunded from the public using disease-specific NFTs or backed by payers such as governments, health insurers, or large philanthropy.

In this VDP we propose to provide $40,000 of funding to Crowd Funded Cures to perform a feasibility study on this new model of research funding (“pay-for-success smart contracts”) to kickstart potential future mechanisms that VitaDAO could support in the future

1 Like

This sounds good but perhaps better to clarify that it would be Guidehouse or some other leading consulting firm with a “name” performing the feasibility study, not CFC, although we would likely commission it or in partnership with another charity or service provider if necessary. So perhaps:

In this VDP we propose to provide $40,000 of funding to Crowd Funded Cures to commission a feasibility study from Guidehouse or another leading consulting firm on this new model of research funding (“generic drug and nutraceutical repurposing pay-for-success contracts”) to kickstart potential future mechanisms that VitaDAO could support in the future

1 Like

great, thank you @Savva

2 Likes

No worries :slight_smile: Have tweaked wording a bit - if good to go will ask @FanONegative to update

3 Likes

Thanks so much for the input @Ben! I’ve added the paragraph, this should be ready to go on-chain :tada:

2 Likes