Impact Markets for Public Good Medicines using Pay-For-Success Contracts

Pay for success model to create incentives to repurpose off-patent drugs

Introduction

A golden opportunity is frequently being missed due to lack of financial incentives to study old inexpensive generic drugs for new indications. Imagine that you discovered that a combination of off-patent (“generic”) drugs worked to better treat pancreatic cancer, which otherwise kills 95% of sufferers within five years of diagnosis. This may sound like science fiction, but it was the experience of Dr. Steven Bigelsen, who was diagnosed with stage 4 pancreatic cancer and used 2 inexpensive generic drugs in addition to his chemotherapy to become a 5-year survivor, now 4 years in complete remission [1]. It was the scientists at the Salk Institute for Biological Studies, not big pharma, that made the discovery that paricalcitol, a form of vitamin D, used by Bigelsen, might be useful to treat pancreatic cancer. Without the ability to perform human trials themselves, and without the ability to profit from their discovery, it has taken well over 20 years since their discovery to finally begin significant clinical trials on this extremely safe and inexpensive drug.

Eroom’s law: Pharma R&D productivity via patented drugs decreasing as costs of developing a new drug double every 9 years — the opposite of “Moore’s Law”. Source: Scannell, Jack W., et al. “Diagnosing the decline in pharmaceutical R&D efficiency.” Nature reviews Drug discovery 11.3 (2012): 191–200. Available at https://www.nature.com/articles/nrd3681 [Accessed 9 September 2021]

The investment required to develop a new drug is increasing exponentially: estimated to cost USD $1–2 billion and take over 10–15 years from discovery until regulatory approval [2]. By comparison, it can cost less than $10–15 million to obtain regulatory approval for repurposing a generic drug or nutraceutical, because it has already been proven safe in animals and humans [3]. For this reason, generic drug repurposing saw heightened interest during the COVID-19 pandemic [4]. However, easy access combined with a lack of private incentives to conduct large “gold standard” randomized controlled trials (RCTs) has caused significant public harm. For example, millions of people self-medicating with unproven off-patent treatments based on low-quality clinical trial data, political leanings, and emotional conviction rather than following the science, leads to unnecessary harm and a supply problem for proven uses, with Hydroxychloroquine (HCQ) [5] and Ivermectin [6] being the key recent examples. However, the off-patent drug fluvoxamine, originally used to treat anxiety and costing $10 a course, has shown similar efficacy to reduce Covid hospitalisation and death rates as Merck’s patented drug molnupiravir, which costs over $700 a course. The US government agency BARDA contractually agreed to purchase $1.2b of molnupiravir subject to FDA-approval with an option to buy another $4b. Similarly, the low-cost off-patent supplement l-arginine has shown to significantly decrease the length of hospitalisation due to Covid.

Psychedelics also have a similar problem due to the active ingredient being off-patent. Generic (racemic) IV ketamine has rapid efficacy for treatment of major depression, with potentially greater efficacy than patented (s-enantiomer) esketamine spray, but is currently only available off-label at high cost specialist clinics. Off-patent psilocybin has also shown efficacy against depression for up to a year, and we may even have co-evolved with this molecule, unlike Polymorph A by Compass Pathways, a controversial synthetic patented version. Medicinal cannabis studies have also been shown they can reduce reliance on opiates to treat chronic pain.

These relatively safe “off-patent” drugs and nutraceuticals are already available globally at low cost, and therefore could save governments and health insurers billions of dollars and also save millions of lives. But without patent protection or any other financial incentive, no pharmaceutical company will fund the large and expensive clinical trials required to achieve regulatory approval and/or definitively prove these safe and inexpensive treatments are effective in humans (or just as importantly, publish the socially valuable negative clinical trial data proving which treatment protocols are not effective)[7].

This is not a small nor isolated problem. There are thousands of FDA-approved generic drugs, with sometimes over a dozen or more being added to the generic drug armamentarium every year as branded drugs fall off the so-called “patent cliff”. This results in their price dropping close to the marginal cost of production due to competition by generic drug companies [8]. There are also over 50,000 off-patent dietary supplements or Generally Recognized As Safe (GRAS) compounds, also referred to as “nutraceuticals”, with over 1000 introduced annually [9]. This vast dataset of safe and affordable off-patent compounds is available to be prescribed by doctors immediately to treat new diseases. However, they are all but ignored by the pharmaceutical industry: once a drug goes off-patent, its chance of obtaining regulatory approval to treat a new disease indication drops to almost zero [10]. Therefore, such repurposed generic drugs and nutraceuticals are considered “financial orphans” that lack private incentives to conduct clinical trials in humans, despite the potential for billions of dollars in healthcare cost savings for repurposing off-patent drugs [11]. Like Dr Bigelsen’s proposed off-patent treatment protocol for pancreatic cancer [12], they usually sit on a laboratory bench, the only evidence of potential efficacy in a few obscure papers, case studies or small, poorly-funded or controlled trials.

Branded drugs falling off patent cliff to join the mountain of low generic drugs with insufficient private incentives for repurposing because a monopoly price cannot be enforced — source: Kolchinsky P. (2017). America’s Social Contract with the Biopharmaceutical Industry. [online] Available at:https://medium.com/the-biotech-social-contract/kolchinsky-tbsc-1-dafc2fe803e5 [Accessed 9 September 2021]

These “unmonopolisable therapies” forming a mountain of generic drugs are essentially public goods suffering from a “tragedy of the commons” under the patent system [13]. In particular, a public good is a “non-rivalrous non-excludable” good that be used by anyone without paying for it, so a free rider problem arises. Information is the ultimate public good because it can be shared and used by anyone for free. This means that if one company pays for the expensive clinical trials showing that a specific treatment protocol for an off-patent drug works in a new indication, they cannot prevent others from “free riding” on this valuable information, once it is published online. Even if a new use or formulation was patented, people would know they could take the “old” generic drug off-label, rather than paying a higher price for the company’s “new” branded version of the drug (which has the same or similar active ingredient as the generic). Accordingly, there are currently no mechanisms to reimburse a pharmaceutical company for their costs of repurposing an off-patent medicine, even if this could lead to significant healthcare cost savings and public benefit. Governments and charities have attempted to address the gap through direct grant funding, but these tend to focus on basic research with the pharmaceutical industry expected to fund large clinical trials, due to the relatively high costs and risk of failure, and the risk of political backlash if the clinical trial fails [14]. Meanwhile, public and private payers bear the significant financial burden of treatment, hospitalization, chronic and end-of-life care. This results in a real tragedy, putting roadblocks in the way of medical innovation to more safe and affordable treatments and cures.

The current model for development of medicine is viewed through the lens of the centuries-old patent system, rather than as public goods. We believe that implementing new incentives holds the promise of blunting the age-old tragedy of the commons and redefining private incentives necessary to develop therapies like the one that saved Dr. Steven Bigelsen’s life. Meanwhile, millions of others will continue to suffer and die from this illness and others like it because researchers struggle to obtain funding for large clinical trials involving off-patent medicines.

Solution — using pay for success contracts to repurpose off-patent drugs

Crowd Funded Cures (https://crowdfundedcures.org) propose a market-driven incentive mechanism to fund research for therapies that cannot attract private capital due to the inability to enforce patent protection. This leverages innovative “pay for success” funding models (e.g., Social Impact Bonds (SIBs), flexible prize funds or retroactive public goods funding) that transfer risk of generic drug repurposing to the market [15]. Pay for success contracts are designed to incentivize impact investors to fund large Phase II/ III randomized controlled trials (RCTs) for a specific indication in return for outcome payments from the fund if successful (see Fig 1 above). Impact investors will be motivated by the market ROI (5–10% p/a) paid over a period of time (e.g. 5–10 years) and subject to Phase IV surveillance trials showing the safety and efficacy of the off-patent treatment protocol is maintained over time. The impact investment opportunity can be made more attractive (above market ROI) if payers such as govts, health insurers or philanthropy also provide matched funding without an expectation of return — effectively acting as follow on investors but relying on the impact investors to act as lead investors and pick the winners (i.e. market generates the “signal” for which promising off-patent repurposing RCTs to fund). This can be compared to the current system of traditional direct grant funding for generic drug repurposing where payers take on all the risk of RCT failure and rarely results in new and useful discoveries because payers are risk averse and do not have the best experts (although the NHS-funded RECOVERY trials and discovery of repurposed dexamethasone to treat Covid is a salient recent exception).

To ensure unbiased and high quality RCTs that can have the biggest health impact for payers and on patient standards of care, independent Contract Research Organisations (CROs) are provided with the off-patent treatment protocol (e.g., the generic drug(s) and their dosing regimen) that fulfils robust RCT design criteria (e.g., high thresholds for statistical significance, fixed inclusion/exclusion criteria and clinical outcomes). The CROs then recruit patients into the RCTs, randomise them into treatment and control arms, analyse the raw RCT data and report on whether the clinical outcome(s) were achieved.

Outcome payments are disbursed from the fund to impact investors according to the value of the treatment protocol RCT data and/or a subsidised price for repurposed generics achieving regulatory approval with a new label for a certain period equivalent to what would have been the monopoly price (e.g. 5–10 years). The latter is a kind of quasi-“advance market commitment” which solves the last mile problem by incentivising impact investors to convince doctors to prescribe the repurposed generic to patients, who only pay for the marginal cost, and the impact investor gets the subsidised price for each prescription from the fund. It also ensures if there are safety or long term efficacy issues, the repurposed generic will no longer be prescribed. The value of the RCT data and/or subsidised “monopoly” price of the repurposed drug is determined by standard pharmacoeconomic assessment that payers undertake for standard patented drugs (e.g., $50k per QALY, or Quality-Adjusted-Life-Year) that considers the incremental cost savings [16]. “Prize-like” pull-incentives to address market failures for development of new drugs for rare, paediatric or neglected diseases, or antibiotics have been implemented in the past, such as transferrable priority review vouchers that can be sold for between $50–350 million as they can add 6 months to the period that a drug is on patent, and advance market commitments that pay a subsidised price for new drugs that would otherwise not be profitable enough to develop [17]. However, vouchers are somewhat crude “lump sum” fixed prizes are susceptible to gaming because they are not linked to the QALY impact of the medicine, and advance market commitments have not been proposed for repurposing off-patent medicines [18]. As noted above, it is over 100x cheaper to repurpose generic drugs, so the cost per QALY under a pay for success model should be much better value for money (e.g. $5–10k per QALY) vs patented drugs ($50k–150k+ per QALY), which means repurposed generics would outcompete patented drugs based on price, unless they are true medical breakthroughs providing exceptional value for society.

Leveraging Blockchain: Retroactive Public Goods Funding / Impact Certificates, DAOs and IPNFTs

We envision administering pay for success or SIB smart contracts as a distributed autonomous organisation (DAO), a novel type of organisation that runs autonomously on a blockchain protocol and enables participation by virtually any person or entity across the globe via CFC Tokens. This idea is similar to the concept of Retroactive Public Goods Funding proposed by Vitalik Buterin or Impact Certificates / Hypercerts proposed by Protocol Labs to fund public goods, but where the smart contract criteria for outcome payments are calculated with reference to specific clinical outcomes in an RCT and less discretionary, which reduces the risk of collusion/rent-seeking/free-riding.

CFC Token holders interact with pay for success smart contracts on the DAO’s open distributed ledger (blockchain) to ensure transparency and immutability across a variety of inputs (e.g., research protocol, success criteria) and deterministic outputs (e.g., outcome payments). Administering pay-for-success smart contracts on a blockchain also enables intellectual property (e.g., RCT results) to be encrypted and locked to the distributed ledger as a non-fungible token (IP-NFT). The IP-NFT enables fractionalized licensing of IP rights and access to third parties that could benefit from the research findings [19].

Access to successful RCT data represented by the IP-NFT is locked until fulfilment of the clinical outcome criteria for an outcome payment under the pay for success smart contract, but unsuccessful RCT data is automatically unlocked and published as useful “negative information” showing which off-patent treatments do not work. If the criteria for an outcome payment includes achieving regulatory approval for the new indication, the newly labelled generic will be eligible to receive a subsidised price for each prescription or lump sum outcome payment per course of treatment.

IP-NFTs can be locked as a trade secret until an appropriate outcome payment or subsidy for the repurposed generic can be determined, which allows a market mechanism for price discovery. CROs and regulators are already required keep RCT data involving patented drugs secret, so the concept is not usual. Outcome payments can also be determined in advance according to clinical outcomes such as regulatory approval, statistically significant improvement vs usual care, and percentage reduction in rates hospitalisation vs usual care.

The issue is that the subsidised price must be determined by payers in advance, which may be difficult before the RCT results are available. However, alternative algorithms / formulae to provide outcome payments can be pre-determined based on health outcomes shown by the RCT data rather than reimbursement via sale of “branded” generics e.g. fixed monthly or annual funds allocated between “registered” IP-NFTs proportional to percentage (%) reduction in hospitalisations vs usual care shown in the RCT data. The latter mechanism allows a “market equilibrium” to arise because the amount of outcome payments decrease when more IP-NFTs are registered and decrease as the IP-NFTs automatically deregister after a fixed period of time (e.g. 5–10 years). It also incentivises incremental improvements to health outcomes as well as breakthroughs.

Therefore, IP-NFTs provide a source of revenue for the DAO’s treasury by funding successful RCTs for off-patent therapies. CFC Token holders can act as impact investors that fund RCTs for off-patent therapies in return for eligibility to receive an outcome payment under the pay for success smart contract in proportion to their fractional ownership of the IP-NFT if the RCT data represented by the IP-NFT fulfils the success criteria for payout. This validation of the raw RCT data is determined by a Results Oracle operated by the independent CRO that generated the RCT data by applying the off-patent treatment protocol.

By allowing CFC Tokens to be purchased and sold on crypto exchanges, those impact investors that are most able to fund successful RCTs are more likely to purchase CFC Tokens which are eligible for an outcome payment, which helps drive up the price. Conversely, those CFC Token holders less likely to fund successful RCTs are more likely to sell their CFC Tokens. This will result in markets driving aggregation of CFC Tokens to those impact investors that are the most efficient at allocating resources towards funding successful RCTs [20]. Thus, using blockchain technology, it is possible to conduct real-world economic experiments in financial innovation to allow stakeholders to co-operate in a self-interested way to solve the public goods problem for off-patent medicines [21].

The main bottleneck to implementing a pilot is to find a payer willing to purchase successful off-patent RCT data or a subsidy for repurposed generic drugs represented by IPNFTs in order reduce disease burden for a specific indication (e.g., COVID-19, pancreatic cancer, depression, alzheimers, multiple sclerosis, amyotrophic lateral sclerosis, Crohn’s disease, longevity [22]). It is also possible to fundraise the repurposing fund through the issue of standard NFTs that represent tiered donation amounts (e.g. bronze, silver, gold, platinum, diamond, for specific disease indications and/or proposed therapies) locked into pay for success smart contracts that either (a) provide funding for particular RCTs a donor supports on the impact investor side or (b) form part of the outcome payments made to impact investors for successful RCT data encoded within an IPNFT on the payer side.

Crowd Funded Cures is currently working with VitaDAO.com to establish a Pay-for-Success Contract x IP-NFT pilot to support clinical trials for off-patent open source medicines that improve longevity such as a $400k Phase 2 RCT by Dr Brad Stanfield to study the effect of generic rapamycin + exercise to improve strength in the elderly. We are leveraging part of a Longevity Prize to raise a $1m payer fund as an incentive for impact investors to fund such RCTs using VitaDAO’s IP-NFT framework. Donations on Stripe via the crowdfundedcures.org website and our NZ charity’s ETH address will support this pilot:

0x188ad16bb967b039640d8fcc7648462514519d85

(Please contact us to confirm receipt of a test amount if in doubt).

Trillion dollar market opportunity unlocked by pay for success contracts

The goal is to open up R&D within the pharmaceutical sector to new incentive models with respect to unmonopolisable therapies, which has the potential to disrupt an industry via the generation of valuable off-patent RCT data. There is a total addressable market of $1.67 trillion in cost savings for payers in the US alone [23]. If we can convince payers to transfer only 1% percent of these cost savings into repurposing SIBs, there is an untapped arbitrage opportunity to capture potential revenue of over USD$16.7 billion to drive generic drug repurposing innovation. Assuming it can be up to 100x cheaper and 10x faster to repurpose generics (as it is possible to start Phase 3 trials immediately, versus developing new drugs where you need to start from the beginning in animal trials), this creates an arbitrage opportunity and scalable business model instead of relying on inefficient and risky direct grant funding where you need to pick which RCTs are likely to succeed. Payers don’t want to fund large RCTs directly: they aren’t designed to innovate new products and fail fast. There is also a free-rider risk for payers that directly fund RCTs. A SIB administered by Crowd Funded Cures, can engage with a syndicate of multiple payers to sign the same pay for success contract, where they agree to share costs and provide exclusive advance market commitments or outcome payments to the impact investor that has repurposed the “branded” generic, with the subsidised price calculated by linking RCT outcomes to QALYs gained. This will create a microeconomic ecosystem that outsources this generic drug repurposing innovation to impact investors to save overall healthcare costs and reduce free riding. With a network of payers backing a SIB, it will be possible to build a scalable business model and private investment opportunity where none existed in the past.

Main Obstacles

  1. Healthcare Payers do not pay for cost savings or value generated by a repurposed generic drug rather than the lowest market price

We understand that the main obstacle to obtaining backing for a generic drug repurposing SIB is that healthcare “single payers” such as the NHS do not pay for health savings due to a specific intervention because of difficulties in measurement and accounting (e.g. RCT data showing that a generic drug treating a new indication reduces hospitalisations). The will also only pay for the lowest cost available to obtain the generic drug rather than paying a premium for repurposing the drug for a new indication. In addition, large health insurers (particularly in the US) often own hospitals and are not incentivised to reduce healthcare costs. Everyone in the healthcare industry is making too much money from the status quo, but this will soon become unsustainable due to an ageing baby boomer population. Payers also do not buy a generic drug for more than the lowest price available for the active pharmaceutical ingredient (API), rather than agree to a value-based / differential price or advance market commitment for a particular “branded generic” in a new indication. Essentially, payers do not currently agree to put a price on the treatment protocol information about which generic drug works in a new disease and the optimal dose, versus the marginal cost of purchasing the generic drug and its associated API as a chemical. This is a bit like only paying an electrician for the cost of a new $1 part made in China, rather than the knowledge of which specific part is needed to fix an electrical fault, which is the truly valuable information that takes years of experience and would save your business $100s of dollars or more. However, with the trillions of dollars available in healthcare cost savings from repurposing low cost generic drugs and nutraceuticals to treat new diseases, perhaps we can find a forward thinking payer willing to purchase successful RCT data validating the safety and efficacy of off-patent treatment protocols that can reduce their healthcare costs. Payers may be convinced to set aside a generic drug repurposing fund for subsidies or outcome payments under a pay for success contract, which allow differential or value based pricing for a new generic indication.

2. Pay for success contracts / Social Impact Bonds are a novel mechanism

Over USD$500m has been raised in SIBs globally, but only approximately USD$74m has been raised in 30 health-related SIBs according to the INDIGO database operated by the Oxford GO Lab [24] and 57 health-related SIBs in Insper Metricis Research Group (Brazil) Database [25]. From our review of these databases, health-related SIBs mostly relate to delivery of healthcare services and none relate to incentivising RCTs for medical research such as repurposing generic drugs. This would be a novel mechanism to incentivise impact investment into ‘public good’ medicines. It may be possible to find outcome payers with sufficient budget for generic drug repurposing (including government agencies such as NHS, NIH, Veteran’s Administration (VA), Medicare/Medicaid and BARDA, health insurers such as UnitedHealthcare, CVS Health, Anthem, Cigna, and large philanthropy such as Gates Foundation, Wellcome Trust and Chan Zuckerberg Initiative). However, it is a significant challenge to overcome institutional inertia from payers and limited mandates to try new financing models, although payers have implemented similar ‘pay-for-performance’ contracts to manage the pricing of expensive new drugs and also “Netflix Subscription-Style” fixed annual payments to incentivise development of antibiotics by paying for QALYs gained for access to a drug rather than based on volumes sold. [26]

SIB model for impact investors to repurpose generic drugs and receive ROI from a percentage of payer (e.g. NHS) cost savings paid into the SIB — Source: https://www.findacure.org.uk/the-rare-disease-drug-repurposing-social-impact-bond/

Conclusion

Economists argue there are no bad people, only misaligned incentives. In the same way, we should not blame the pharmaceutical industry for gaming the patent system to maximise profits [27]. However, we should blame our sole reliance on patents to develop new medicines. With Pay-For Success (PFS) contracts to incentivise clinical trials for off-patent drugs or unmonopolisable therapies, we can provide more flexible and cost-effective “open source” approach alongside patents.

PFS can incentivise the generation of useful clinical data supporting personalised treatment protocols by linking rewards to successful patient outcomes, rather than maximising the sales of a single monopoly-priced drug in the general population until the patent runs out. It also takes advantage of the biotech innovations of the last 40 years, including genetic engineering, personalised medicine (informed by blood tests and low-cost DNA sequencing), blockchain, artificial intelligence [28], decentralised clinical trials and telemedicine, and can help pull our broken system for medical innovation into the 21st century. We hope you can join us in supporting our mission to obtain backers for PFS contracts.

TL;DR

Creating new private incentives to repurpose generic drugs via pay for success contracts are a significant opportunity for private industry compared to the estimated USD $1–2 billion over 10–15 years to develop a new drug, as it can cost less than $10–15 million to obtain regulatory approval for repurposing a generic drug or nutraceutical (100x lower cost), because it has already been proven safe in animals and humans.

A pay for success contract for repurposing generic drugs to treat new diseases has the potential to create $1.67 trillion in cost savings for payers (e.g. govts, health insurers) in the US alone. If we can convince payers to transfer only 1% percent of these cost savings into pay for success contracts, there is an untapped arbitrage opportunity to capture potential revenue of over USD$16.7 billion to drive generic drug repurposing innovation.

Significant cost-savings available for payers that agree to a pay for success contract. By way of example only, repurposing the off-patent NSAID ketorolac as a prevention treatment resulting in 10% reduction in breast cancer recurrence would cost $5 million annually (100,000 cases at $50 per case for ketorolac and its administration). The savings would be over $1 billion annually (10,000 patients at approximately $100,000 per patient for the treatment of metastatic disease).

References:

[1] https://letswinpc.org/my-treatment/2017/02/14/different-approach-pancreatic-cancer-treatment/

[2] https://www.sciencedirect.com/science/article/abs/pii/S0167629616000291?via%3Dihub. This USD$1–2 billion figure is controversial (see https://www.lse.ac.uk/News/Latest-news-from-LSE/2020/c-March-20/Average-cost-of-developing-a-new-drug-could-be-up-to-1.5-billion-less-than-pharmaceutical-industry-claims), but could also be a conservative estimate due to costs of finding new patented drugs doubling every 9 years — a phenomenon referred to as “Eroom’s Law” — https://en.wikipedia.org/wiki/Eroom%27s_law. Some industry commentators suggest it could cost from USD$4–10 billion to develop a new drug — see https://www.proclinical.com/blogs/2020-9/why-does-it-cost-so-much-to-develop-new-drugs.

[3] https://dndi.org/wp-content/uploads/2019/10/DNDi_ModelPaper_2019.pdf. See Figure 1 on page 17: Out-of-pocket costs per stage of development for eight projects in DNDi’s portfolio.

[4] See https://www.healthaffairs.org/do/10.1377/hblog20201204.541050/full/ citing https://www.nature.com/articles/s41586-020-2577-1.

[5] https://www.fda.gov/drugs/drug-safety-and-availability/fda-cautions-against-use-hydroxychloroquine-or-chloroquine-covid-19-outside-hospital-setting-or

[6] See https://www.nature.com/articles/d41586-021-02081-w which highlights difficulty with conducting RCTs for off-patent drugs where the science is highly-politicised and leads to self-medicating. See also https://www.theguardian.com/world/2021/aug/30/australian-imports-of-ivermectin-increase-10-fold-prompting-warning-from-tga

[7] It may be possible to patent a reformulation of your generic drug(s), but this will not be commercially viable if you cannot prevent doctors prescribing the “old” generic drug(s) off-label, or if patients can buy it cheaply in a pharmacy or online. Reformulating drugs has also been criticised as “evergreening” (which the pharmaceutical industry refers to by the euphemism of ‘pharmaceutical patent life-cycle management’). This is where pharmaceutical companies try to game the patent system by patenting a reformulation just before their old drug goes generic and then using marketing to encourage prescribing of the new formulation and discouraging substitution with the old generic drug which may be just as effective. Classic examples include reformulation of AstraZeneca’s heartburn drug Prilosec into the heavily-marketed ‘purple pill’ Nexium. On the other hand, reformulations that result in incremental improvements to medicines are not a bad thing if they lead to significant improvements over time. Whether evergreening strategies are adequate to ‘rescue’ unmonopolisable therapies is discussed in Chapter 3 of Mr Kerdemelidis’ 2014 masters thesis (https://ir.canterbury.ac.nz/handle/10092/9826).

[8] https://www.fda.gov/news-events/fda-voices/fdas-generic-drug-program-2020-helped-ensure-availability-high-quality-affordable-drugs-amid-covid and https://medium.com/the-biotech-social-contract/kolchinsky-tbsc-1-dafc2fe803e5.

[9] https://www.ncbi.nlm.nih.gov/books/NBK216048/ (based on 29,000 dietary supplements available in 2000 and 1000 added p/a according to FDA) and https://www.mskcc.org/cancer-care/diagnosis-treatment/symptom-management/integrative-medicine/herbs/search

[10] https://pubmed.ncbi.nlm.nih.gov/33397471/

[11] https://www.healthaffairs.org/do/10.1377/hblog20140306.037370/full/ — Article by Dr Vikas Sukhatme, Dean of Emory School of Medicine, discussing ‘financial orphan’ therapies. The article mentions that the repurposing the off-patent NSAID ketorolac as a prevention treatment resulting in 10% reduction in breast cancer recurrence would cost $5 million annually (100,000 cases at $50 per case for ketorolac and its administration). The savings would be over $1 billion annually (10,000 patients at approximately $100,000 per patient for the treatment of metastatic disease). In addition, US Army agreed to pay Merck $1.2 billion for 1.7 million courses of molnupiravir, should regulators approve (https://www.reuters.com/business/healthcare-pharmaceuticals/merck-says-us-govt-buy-about-17-mln-courses-cos-covid-19-drug-2021-06-09/ and https://www.keionline.org/36698). Why not pay a fraction of that amount for RCTs that prove generic drugs can treat Covid19 (see . Why not pay a fraction of that amount in pay for success contracts for relatively safe and low cost repurposed generic drugs to treat Covid19 (e.g. L-arginine — https://www.thelancet.com/journals/eclinm/article/PIIS2589-5370(21)00405-3/fulltext).

[12] https://pubmed.ncbi.nlm.nih.gov/30034255/.

[13] “Unmonopolisable therapies” are a subset of ‘financial orphan’ therapies, the latter which can be considered a broader class of unprofitable therapies that lack a sizable market such as rare disease, tropical diseases and antibiotics. These are also discussed in Chapter 3 of Mr Kerdemelidis’ 2014 masters thesis (https://ir.canterbury.ac.nz/handle/10092/9826), that cited the work of Professors Kapczynski & Syed, who also referred to them as “highly non-excludable therapies” (https://www.yalelawjournal.org/essay/the-continuum-of-excludability-and-the-limits-of-patents).

[14] https://apnews.com/article/virus-outbreak-health-us-news-ap-top-news-92e6cabd8834e6865eee67f116b006c1 — Pepcid-COVID Study Raised Red Flags Weeks After $21M Grant. Ironically, direct grant funding can lead to even more risk and wasted taxpayer funds, such as US$150 million of federal funding on the dietary supplement curcumin studied in more than 120 clinical trials, with no tangible evidence that it is an effective treatment for any medical condition — https://theconversation.com/ivermectin-shows-us-how-hard-it-is-to-use-old-drugs-for-covid-heres-how-to-do-better-next-time-168192. Further, conservative estimates of the expense of the clinical trials component for repurposing a specific class of existing drugs (phospholipidosis-inducing CADs) to treat Covid-19 may be over $6 billion US dollars — https://www.science.org/doi/full/10.1126/science.abi4708. A market mechanism would have been more efficient or at least not expose taxpayers to the risk of failed RCTs.

[15] https://en.wikipedia.org/wiki/Social_impact_bond, https://en.wikipedia.org/wiki/Health_Impact_Fund and https://medium.com/ethereum-optimism/retroactive-public-goods-funding-33c9b7d00f0c (these mechanisms proposed use cases of “pay for success” contracts).

[16] https://en.wikipedia.org/wiki/Incremental_cost-effectiveness_ratio

[17] https://en.wikipedia.org/wiki/Priority_review. See also https://www.nature.com/articles/nbt.4193 which discusses the authorisation of the US agency The Biomedical Advanced Research and Development Authority (BARDA) to use prizes such as “market entry rewards” (MERs) or priority review vouchers/TIPRs to incentivise development of new antibiotics. See also 6-months patent extensions granted for researching effect of drugs in pediatric populations (https://www.healthaffairs.org/doi/10.1377/hlthaff.2016.1340). For Advance Market Commitments (AMCs), see https://en.wikipedia.org/wiki/Advance_market_commitments. On Feb. 9, 2007, five countries (Canada, Italy, Norway, Russia, the United Kingdom), and the Bill & Melinda Gates Foundation backed a US$1.5 billion AMC to pay a subsidised price for the first vaccine for pneumococcal disease, a major cause of pneumonia and meningitis that kills 1.6 million people every year.

[18] Social Impact Bonds for repurposing generic drugs to treat rare diseases have been proposed by Bruce Bloom at the US charity Cures within Reach (https://ssir.org/articles/entry/repurposing_social_impact_bonds_for_medicine) and the UK charity Findacure (https://www.findacure.org.uk/the-rare-disease-drug-repurposing-social-impact-bond/) in the context of rare diseases. However, the use of social impact bonds and other pay for success contracts such as advance market commitments for repurposing generic drugs have not received payer backing to date.

[19] See proposal by Paul Kohlhaas at Vitadao to cryptographically tokenise clinical trial data and patents as IPNFTs to allow distributed ownership of IP and incentivise investment in early stage biopharma research (see https://medium.com/molecule-blog/an-open-bazaar-for-drug-development-molecule-protocol-a47978dd914).

[20] This was a core advantage of the Health Bond proposal by Ronnie Horesh, the NZ economist who first conceived of SIBs in 1988 (available at https://www.socialgoals.com/health.html). By allowing tradeable SIBs, the markets will ensure the most efficient allocation of resources to those best able to maximise health impact (and outcome payments under the SIB). See proposal to trade a “Health Impact Token” on the crypto markets (see https://healthimpacttransfer.org/). Crowd Funded Cures (https://crowdfundedcures.org) proposes creating SIB smart contracts backed by payers where CFC Token holders can act as impact investors and fund the generation of off-patent RCT data encrypted into IPNFTs, which are unencrypted upon achieving success criteria for an outcome payment, as determined by an oracle managed by an independent CRO. This is inspired by the tradeable Health Bond proposal by Ronnie Horesh, the NZ economist who first conceived of SIBs in 1988 (available at https://www.socialgoals.com/tradeable-health-outcome-bonds.html). By allowing CFC Token holders to invest in off-patent IPNFTs and trade their rights to receive outcome payments under SIBs on crypto exchanges, the markets will ensure an efficient allocation of resources to the CFC Token holders that are best able to invest in generation of successful RCT data via IPNFTs that maximises health impact (and outcome payments under the SIB), by tending to aggregate CFC Tokens due to their increase in market value.

[21] See proposal by Vitalik Buterin to use DeFi/Web3 technology to help solve the public goods problem (https://medium.com/ethereum-optimism/retroactive-public-goods-funding-33c9b7d00f0c).

[22] Repurposing off-patent drugs (e.g., metformin, resveratrol, NMN, rapamycin, etc) to improve longevity by addressing the direct causes of aging (e.g., DNA damage, intra/extracellular junk and senescent cells) has the potential to result in massive reduction of overall disease burden as most diseases are associated with these causes, including cancer, dementia, cardiovascular disease and arthritis.

[23] https://accessiblemeds.org/resources/blog/2017-generic-drug-access-and-savings-us-report

[24] https://golab.bsg.ox.ac.uk/knowledge-bank/indigo/impact-bond-dataset-v2/

[25] https://docs.google.com/spreadsheets/d/1sskkubuQsuT3q4TD8pl-E67_aK7tuMcxaCibD4acS5Q/edit#gid=244876241

[26] https://www.pwc.com/gx/en/pharma-life-sciences/pdf/pay-for-performance.pdf and https://www.nice.org.uk/news/article/nice-reaches-important-milestone-in-the-uk-s-efforts-to-tackle-antimicrobial-resistance

[27] See note [7] above discussing patent ‘evergreening’.

[28] Artificial intelligence (AI) or machine learning (ML) approaches to drug discovery allow the rapid review of hundreds of thousands of scientific papers and medical records to determine drug-disease interactions and discover new drugs via in-silico modelling. See for example, the US charity RebootRx using AI to find non-cancer generic drugs to treat cancer (https://rebootrx.org/), Healx using AI to repurpose drugs to treat rare disease (https://healx.io/), and DeepMind solving the 50-year old protein folding challenge using AI (https://deepmind.com/blog/article/alphafold-a-solution-to-a-50-year-old-grand-challenge-in-biology).

IMPORTANT DISCLAIMER:

This document does not constitute a prospectus nor offer document of any sort and is not intended to constitute an offer or solicitation of any investment or other product or service in any jurisdiction. Crowd Funded Cures is an initiative of a registered NZ charity and NGO, the Medical Prize Charitable Trust (Charity No. CC49977). All donations would be used to support their mission to help establish pay for success contracts to repurpose generic drugs to treat specific indications (e.g. Covid-19). Crowd Funded Cures will partner with other NGOs, consulting firms and service providers to achieve this goal.

How can you help?

Join us on our social media accounts below or please get in touch at info@crowdfundedcures.org.

To support our NZ charity’s mission, it is possible to donate securely via Stripe on https://crowdfundedcures.org (and in less than 30 seconds with one-click if you have Apple Pay enabled with Safari browser on mobile or desktop). If you are a NZ taxpayer you will be eligible to receive a tax credit of 1/3rd of your donation.

You can also donate to our Ether address below (but please ensure you contact us first if you are uncertain how to do this so we can arrange to receive a small test amount):

0x188ad16bb967b039640d8fcc7648462514519d85

Social Media

Twitter: https://twitter.com/CrowdFundedCure

Facebook: https://www.facebook.com/crowdfundedcures/

Discord: https://discord.gg/6tFG8RDygW

Telegram: https://t.me/joinchat/pJoHURDJTF81NjA0

YouTube: https://www.youtube.com/channel/UCxRPDHazCOs_uONKq-jSOiw

LinkedIn: https://www.linkedin.com/company/67096455/

Reddit: https://www.reddit.com/r/CrowdFundedCures/

Medium: https://crowdfundedcures.medium.com/

About Crowd Funded Cures — Team:

Savva Kerdemelidis, LLM (1:1 Hons), BSc(Hons), Founder & CEO, Crowd Funded Cures

Savva is a Commercial/IP Consultant Legal Counsel and a NZ and Australian Patent and Trade Mark Attorney with 18+ years experience advising software, medical device and technology companies in the UK, EU, US, AU and NZ in relation to IP, commercial contracts, software licensing, crypto, data protection and GDPR compliance. He conducted his LLM thesis in 2014 on alternative incentive mechanisms to develop off-patent medicines (see
https://ir.canterbury.ac.nz/handle/10092/9826).

https://twitter.com/newzealandlaw

Nicholas Fiorenza, MSc Molecular Medicine, Business Development & Operations

Nick is a published molecular biologist with 6+ years of life science startup industry experience. He is passionate about merging healthcare with the nascent web3 ecosystem. His masters research focused on repurposing off-patent anti-psychotic drugs for anti-cancer therapy.

https://twitter.com/nfiorenza

Amir Amraie, MPharmS, COO, Crowd Funded Cures

Amir is a registered UK Pharmacist. He graduated from University College London (UCL). He has experience stemming across hospital, general practice (GP) and community. He is also an entrepreneur with experience operating a health-tech conference and working with various tech companies, incubators and startup competitions.

https://www.linkedin.com/in/amiramraie/

Andrew Horton, CKA, CTO, Crowd Funded Cures

Andrew is a cyber security professional with 10+ years experience. He has developed open-source security tools that form part of the standard arsenal of penetration testers, including multiple tools within Kali Linux. His research is included in textbooks, cited in academic papers, and offensive security methodologies (OWASP, PTES, etc). He has consulted to clients globally, including many banks, energy companies, telcos, listed companies, NGOs, and blockchain/cryptocurrency projects. He currently serves on the advisory boards of multiple startups.

https://www.linkedin.com/in/andrewhortonsecurity/
https://github.com/urbanadventurer

Ariella Coler-Reilly, BA
Scientific Communication Advisor

Ariella is an MD Ph.D. candidate at Washington University in St. Louis and an experienced science writer and illustrator. She studied Molecular Cell Biology and Japanese at UC Berkeley. As a managing editor at VitaDAO, she strives to promote health literacy, decentralized science, and diversity in STEM.

https://www.linkedin.com/in/ariella-coler-reilly/

Zack West, BSc, Marketing & Design

Zack is a marketing professional with 10+ years of experience in design, website development, and digital marketing. He holds a BSc in Graphic Communications from North Carolina State University and is currently a BSc Computer Science candidate at Western Carolina University.

Brahma P. Sen, Blockchain Developer
Software Engineer

Veteran health IT professional advising and implementing blockchain, cloud, machine learning, data and system architecture services to US federal government and private industries.

Spyridon Antonopoulos, PhD
Strategic & Partnerships Advisor

Spiro has more than 15 years of experience as a consultant working in the health insurance and banking industry. Spiro spent two years with crypto startup Kuva.com and currently advises on the intersection of the decentralized finance (DeFi) economy with emerging federal and state regulations.

https://www.linkedin.com/in/spiroantonopoulos/

Ed Kahn
Founding Partner, Rediscovery Life Sciences
Director, Strategic Business Development, Cures within Reach

Edward Kahn, founded EKMS, Inc. in 1986, pioneering systems and novel approaches to IP portfolio policing and mining. He was president from 1986 until EKMS was sold to UTEK (AMEX) in 2004. Kahn was the Director of Strategic Business Development at Landon IP, Inc. He has spoken and written extensively on licensing, patent litigation and IP strategy for John Wiley, Euromoney Publishing, Forbes, the Wall Street Journal, the Boston Globe, Mass HiTech, the Licensing Executives Society (LES) and the Boston Patent Lawyers’ Association.

https://www.linkedin.com/in/ed-kahn-81b26b3/

Dr Steven Bigelsen, Medical Advisor, Crowd Funded Cures
Physician, Assistant Clinical Professor, Rutgers New Jersey Medical School

Dr. Stephen Bigelsen is an allergist-immunologist in New Jersey and is affiliated with Morristown Medical Center and Saint Clare’s Denville Hospital. He received his medical degree from Chicago Medical School at Rosalind Franklin University in 1987 and has over 34 years of experience in the medical field. In July 2016 at the age of 55, he was diagnosed with stage 4 pancreatic cancer. He began treatment with chemotherapy, and adjunctive therapies of IV Paricalcitol (an analog of Vitamin D) and hydroxychloroquine (a generic malaria drug) and realised a complete response in less than one year. Dr. Bigelsen has had no evidence of disease since that time, and has worked as a patient advocate by publishing articles, giving talks, encouraging research, and assisting a variety of cancer foundations.

Dominic Nutt, Strategic Advisor
Communications Consultant

Dominic is a communications specialist interested in funding and accelerating clinical trials. He worked with Maurice Saatchi to deliver a UK Act of Parliament speeding up medical innovation within the NHS and has written peer-reviewed papers for the BMJ on new ways of funding clinical trials.

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Crowd Funded Cures

Crowd Funded Cures

DeSci crowdfunding platform to incentivise development of public good medicine without reliance on patents by using IP-NFTs & Pay-for-Success (PFS) contracts