DeSci: a better model for scientific research?
For all the doom and gloom that we see in the news today, we are nonetheless living in an age of great technological advancement, especially when it comes to the life sciences. From CRISPR editing to NVidia’s GPUs that can simulate protein folding and drug effects in a fraction of the time it takes to conduct real-life experiments, the tools are in abundance.
But tools without a purpose are pointless, and until recently, these tools while profound in their abilities have been largely used like display pieces in a showroom of curiosities. For example, one of the great pioneers in CRISPR editing which we’ve written about is Intellia Therapeutics, founded by Nobel Prize winner Jennifer Doudna. Their special ability: the ability to edit the human genome in living patients, including with in-vivo treatments (i.e. genes get edited inside your living body).
There is no doubt this technology is truly revolutionary and in time will change the world. These treatments have the potential to cure genetic diseases previously deemed to be incurable, by virtue of being “in the genes”. But one does sometimes wonder why their first area of research for a real-life application for CRISPR gene editing is to treat Transthyretin Amyloidosis (aka ATTR Amyloidosis), a disease that according to the US NIH has a global prevalence of (wait for it…) 10,186 people at the midpoint of an estimated range of 5,526 - 38,468 globally (in the polyneuropathy form). For completeness, estimates of the prevalence of the cardiomyopathy form are around 5 per 100,000.
The answer as it turns out is that ATTR is a monogenic disease that represents an ideal target for applying CRISPR-Cas9 therapy i.e. it was the low hanging fruit disease to test CRISPR treatments on. In other words, it was the path of least resistance to getting approval for the use of this specific type of therapy. Pursuing the fastest route to validating a treatment approach isn’t a bad thing in itself, but going down this logical route, the question is how long it will take before CRISPR treatments actually start getting pointed at the diseases that plague most of the world (where applicable, of course)?
What drives the decisions behind what drugs and therapies to research?
We took some time to look at the research pipelines past and present of many of the major drug companies around in an effort to work out the intrinsic motivation for research decisions. For the most part, based on publicly available information (as always, at risk of making oversimplified conclusions – probably in the right direction but equally probably imprecise), decisions circle around optimising for returns on capital.
For the most part, the low-hanging fruit in the world of drug discovery has been exhaustively picked. The British Pharmacological Society, for one, published a rather depressing essay (or, dare we say, damning) written by one of its fellows, on the prospects for new drug discovery. The problems that ail the drug discovery process are many, including a lack of knowledge of experiment design and statistical analysis and a (wrongly) skewed focus on “impactfulness” i.e. findings that are positive and exciting, rather than focusing on reproducibility of results or even “number of people whose lives would be improved/saved as a result”. The bulk of the work stays clinical, while siloed research activity and a reluctance to build on existing/past research (deemed “unoriginal” and hence “unfundable”) means that it’s every man/woman for his/her own.
The author concludes in his article, still depressingly, that:
“That said, given that members of the public are often naïve, and far too willing to put hope before evidence (witness the numbers who believe in space aliens, the investment value of a lottery ticket, ghosts, and god), the processes leading to our being found out will likely be slow. That is no excuse for letting the situation drift, however.
I would like to see pharmacologists applying more rigour to their experimental design. Sadly, I suspect that the ‘publish or perish’ mentality is now so pervasive that attempts to improve standards will be resisted (‘don’t rock the boatism’), and that without a better coordinated effort, with unswerving leadership, nothing much will change. We shall see.”
This was an article written in 2018, but it appears that its observations are even more true today than they were. Whether in academia or in commercial labs, the large proportion of research decisions are driven by the ability to get that research funded, and in turn, the potential return on capital.
Now, as we know, ROIC/ROCE are relative numbers relating to efficiency. Optimising for returns means always choosing what is easy, efficient and profitable, not necessarily what is good, important, and not even necessarily what there is a great market demand for.
No surprise then that there doesn’t seem to be a coherent narrative for where research dollars and intellect is being directed in a multi-billion-dollar industry: it’s one thing being an event-driven black box, it’s another when the direction of the industry’s narrative is for the most part arbitrary and unsystematic.
Creating a money trail
That the industry behaves in this manner is, arguably, not entirely of its own fault. It is simply following the money, in search largely of grant funding which is itself sourced from largely non-profit sources: foundations, trusts, governments, charities etc. The allocators of these funds arguably have to do their job and prove to their stakeholders that they are making the best use of the money placed in their care. No surprise that allocators’ desire to show “impact” filters down to researchers’ preference for “impactfulness”, as the BPS described, rather than actual impact (without inverted commas).
Enter DeSci.
The idea of decentralised anything has been around for ages, but it was only with the onset of crypto that it could reasonably come into existence, for two main reasons.
Firstly, crypto allows distribution: anyone, anywhere in the world, can interact with a decentralised community and OWN a part of it by picking up tokens. They aren’t bounded by the usual gates of securities laws, brokerages, custodians, foreign exchange or physical location. This allows unfettered decentralisation.
Secondly, programmable money allows for rules to be enforced in a decentralised system. Ethereum was the first to make this possible, and perhaps the other smart contract enabled blockchains will continue to push this frontier. As a result, people could do more than just loosely interact and participate – decisions could be made and enforced, consequences of reward and loss could manifest, and things very quickly got real.
Put differently, individuals across the world could collaborate with other individuals that they barely know because the crypto infrastructure took care of the issue of lack of trust. We first saw this with DeFi, where lenders and borrowers could come together without either side knowing who the other was. Code was law, collateral was posted and, in some cases, seized, and for all the drama that DeFi has experienced, it hasn’t fallen apart contrary to the prognostications of is sceptics and cynics.
Nonetheless, while DeFi served largely speculative purposes in the reflexivity of crypto land, it also demonstrated a third interesting ability of crypto: the ability to aggregate funding into pools for a specific purpose.
DeSci takes this into the realm of scientific research.
DeSci is in some way the capital-rich extension of the much-older trend of biohacking, better described as “DIY biology”.
The reddit thread we’ve linked to was first created at the end of 2012, although the concept seems to have been around since as early as 1988, with even lab kits being on sale on eBay since 2005, and while the sceptics would say that this is the equivalent of playing with fire, experimenting with drugs on one’s own body, the very existence of such a reddit page and such communities underscores a fundamental problem in the pharma world: while billions of dollars of R&D are being spent on products that are capital optimal for firms, there are also millions of patients desperate for some sort of treatment for their conditions and unable to find anything that works.
Left with no alternative, they turn to doing it themselves. For proponents of biohacking, this is like what open-source code is to software. This is open-source pharmacology.
Combining crypto’s abilities to aggregate value, create governance structures and form communities with the world of scientific research – especially in healthcare – could be revolutionary for the world of pharma/biotech.
Where funding decisions for pharma research – in fact, arguably for all scientific research - used to sit with boards of trustees and allocators, DeSci allows communities comprising individuals to congregate and aggregate their funding based on what they want to fund. Prospective patients suffering from certain diseases could vote with their wallets and create the requisite economic incentives and point research efforts in the direction they want.
In many ways, this is much preferred to sitting around and waiting for a pharma company to decide to point research resources your way. Furthermore, sometimes the solutions aren’t only about making new drugs – they can also be found in repurposing or slightly modifying existing drugs in the market, including generics that are off-patent which no corporate would bother with given the ease with which generics can be produced and patents broken.
Crowdsourced demand, specialised research
At this point, we should draw the line between experimenting on drugs based on some reddit posts and professional medical research. The risks of amateur experimentation of drugs are very real and literally life threatening.
This is where the analogies between Reddit biohackers and the new generation of DeSci DAOs ends.
The flipside is that it doesn’t take a multi-million (or billion) dollar pharma company to make an FDA approval submission. Indeed, submitting a new drug application, based on the FDA’s requirements, is something even your average physician can do. It just takes the right incentives to get the research and those submissions done.
The approach of DeSci is simple: encourage interest in a specific theme of scientific research to congregate, aggregating capital in the process. Then, co-opt the existing grant funding mechanism to offer funding to scientific projects that advance developments in the field of interest, disbursing funds to professional researchers with proper projects. Ultimately, if therapies are proven through research to be successful, including through the undertaking of regulated drug trials, IP can be created and licensed for production, with the proceeds (and the therapeutic benefits) accruing to the DAO, its contributors and to patients around the world.
For example, VitaDAO (which we highlighted in a newsletter many months ago) focuses on longevity research, funding research projects that aim to create intellectual property around prolonging life and ensuring that people live better for longer. Other DAOs like PsyDAO have a focus on psychedelic research. In both cases, the aim is to take the pooled funds in the DAO, direct them towards research projects, tying the outcome of those projects (the IP) into an NFT which is owned by the DAO and ultimately not only create therapies that serve the purpose they were designed for but also monetise that IP for the benefit of the DAO itself, further funding future research.
Over the year or so since VitaDAO’s founding, for example, it has sourced more than 200 research projects and funded more than $2.5m worth of research, with a further $2.2m more in treasury.
Aside from being one of the first DeSci DAOs around, VitaDAO is interesting for another reason: the choice of its research focus. Everybody gets old, everybody dies, but arguably there is nothing to say that there is no reason to try to extend life AND the quality of that extended life if it is scientifically possible.
By building a critical mass of funding around a theme (longevity) which has a huge addressable market (everyone who’s alive), VitaDAO has created a directional impetus for R&D efforts in the life sciences that previously never existed. For once, we can look at the space and say that there is a somewhat defined direction of travel for upcoming developments – like e-commerce adoption, electronic money or cloud penetration did in the tech space, like 3G to 4G to 5G in the telco space etc.
Perhaps now things can advance beyond the seemingly arbitrary decisions that used to characterise the space.
Tools with purpose
The purpose that the scientific community needs could be best summed up by JFK’s speech about going to the moon:
“We choose to go to the Moon,” Kennedy said. “We choose to go to the Moon in this decade and do the other things, not because they are easy, but because they are hard, because that goal will serve to organize and measure the best of our energies and skills, because that challenge is one that we are willing to accept, one we are unwilling to postpone, and one which we intend to win, and the others, too.”
DeSci could be the source of such a purpose, driven by providers of capital, expertise and effort, including those who actually NEED reprieve from their medical conditions but whom the industry may have little interest in serving. And with that purpose comes direction and a structural thesis of demand-driven therapeutics development which could profoundly change the lives of large swathes of patients in need of treatment that the “free market” has so far failed to provide.
The structural stories here are those of people living longer and better, or even of a world that is increasingly able to treat mental health issues previously deemed “all in the mind”. The possibilities are endless, as they have always been, but this time the possible paths are becoming visible.
That would make for a profoundly transformative structural investment that has huge addressable markets and lasts generations. For the moment it is still very early days, but wow - isn’t it all just so fascinating?
The possibilities are very exciting – for investors and for mankind.