12 July, 2019
Viren Mehta of Mehta Partners LLC mulls the potential of blockchain, the rapidly evolving IT resource that secures every step in a business action.
Just as the summer equinox ushered in dreamy thoughts of our next holiday, two of the major industries that account for about a third of the global output faced more intense summer heat, which may not dissipate even as the seasons change. Facebook, with over two dozen of the planned 100 major global merchants already signed up, said it is ready to roll out its Libra financial instrument – anchored around blockchain – setting the stage to strip the traditional financial institutions of their day job. The proposed frictionless financial instrument will, among many benefits, be available to the 85% of the world population presently unable to access essential financial services, thanks to the limitations of the services that the traditional banks choose to offer.
The Democrats’ Answer?
The Democrats have two dozen candidates claiming to qualify as the next president of the US in the 2020 elections, and biopharma is one of the primary targets they are using to prove their qualifications. None of them can quite articulate how they would rid the world of biopharma malpractice, but blockchain may be what they mean. Or at least that is what they should offer as an effective solution for the 21st century. As with Facebook Libra’s frontal attack on the financial industry, the attacks on biopharma should be aimed at freeing up the sclerosed system of undue regulations so the consumer can decide the value of the therapies they need.
Facebook Libra illustrates how the antiquated regulatory systems that often enrich the established companies more than they benefit the consumer can be awakened overnight.
The financial and biopharma industries are among the most regulated in our capitalist system, where regulations provide a secure curtain for the established companies to hide behind and play the market forces to an unfair self-interest. For example, these companies can create perpetual monopolies with incremental, and at times no innovation. A string of middlemen aggravates the pain, if not pouring salt on the wound. Consumers have little choice but to take it on the chin. An ever-increasing proportion of patients either go without or go bankrupt.
The power of blockchain technology is to record the inviolable trail of every step of a business function. When combined with total and transparent access to relevant information, along with fresh regulatory oversight of these technologies, a consumer should be able to choose and pay for the value she receives. Above all, many more would have access.
Both industries, finance and biopharma, when duly reinvented, promise to greatly improve our lives. The process of reinvention should strengthen both the industries as well as the establishment companies – as that is the only way they would survive.
To be sure, both the financial and biopharma industries already deploy blockchain at an accelerating pace, from securing supply chains to tracking each click of a contract to recording payment trails. But Libra aims to pull the rug from under the entrenched financial interest groups, streamline regulatory obligation in the current structure, and open up the system: initially through its partners and eventually directly at the consumer level.
Transparency + Traceability = Efficiency
Similar fundamental regulatory and R&D process rethink is needed for biopharma to prepare for the transparency required in the 21st century.
Imagine an experienced biopharma R&D team that deploys the modern tools of life sciences to validate a therapeutic agent for a selected target along with a companion diagnostic, which then quickly enrolls appropriate patients in one or two small but well-powered clinical studies to demonstrate acceptable safety and efficacy. Today, this process averages over a decade and costs a billion dollars.
Now imagine this proven team conducting these studies in an environment where transparent information flow and blockchain-ensured tracking will enable this development cycle in a handful of years at a tenth of the current cost. The resulting data can be scrutinized by the interested patient and her team of clinical experts to decide if this is the right treatment for her and obtain it online at a fair price. To be sure, numerous specific issues will need to be revamped during the transition phase such as empowering the patient to truly take charge with the help of her team and regulators gaining comfort with real-time and real-world data, just as Libra will need to address money laundering, privacy, and the garbage-in-garbage-out challenge that can compromise the quality of this inviolable validation trail.
But there should only be a relatively short window of time before such a traceable, transparent format proves its vastly superior safety and benefits. Just as Tesla continuously learns enormous amounts from real-time and real-world evidence fed in by its cars on the road , making the three Tesla car models the three safest cars on the road—all of this in less than a decade—a rational deployment of the tools of life sciences and information technology together can begin to deliver a growing stream of effective if not curative therapies for the entire world, not just a minority who can afford it.
Pharma’s ‘Manhattan Project’ Beckons
Just as another tech company if not a total newcomer can be expected to build on the forces that the announcement of Libra has triggered, biopharma awakening will be triggered soon, regardless of how the presidential debates unfold and who is elected as the next President of the US in 2020. One of the tech groups or more likely a start-up may begin the above R&D journey somewhere with total transparency worldwide so that every patient will be able to judge the value of each therapy such a group discovers, develops and brings to the market online.
Just as a computer or a personal gene sequence is a $1,000 commodity today, something that we could not imagine a decade ago, there is now an opportunity to create biopharma’s own ‘Manhattan Project’ to offer exceptionally effective treatments, if not cures, for a majority of diseases plaguing mankind for under $1,000 per patient by 2040 – as we challenged the industry’s leaders in our last column. (Also see “Mehta Analysis: Welcome to BioPharma 2.0” – Scrip, 29 May, 2019.) Otherwise an unknown start-up can be counted on accomplishing for biopharma what Facebook Libra has proposed this summer for the entrenched financial interests. Biopharma managers have deep experience and practically unlimited resources, giving them a tremendous edge over any start-up in holistically integrating IT tools, including blockchain, to help bring regulatory processes into 21st century, and accomplishing this noble goal for their own good as well as that of society.
This column originally appeared on Scrip Biopharma Intelligence, July 12 th, 2019.