We recently worked with an organization that defines the lean, entrepreneurial startup model - 60° Pharmaceuticals. 60° Pharmaceuticals, run by Geoff Dow and a small team of advisors, is trying to change the model of drug development for neglected diseases – using crowdsourcing to build virtual teams for specific research projects. He then plans to invest a portion of the profits from drug sales into further disease research. He calls it the “Philanthropic-for-Profit” model. We asked Geoff to talk to us about his organization and his first Challenge, seeking a team to identify an early lead compound for the treatment of dengue fever.
Hi Geoff – thanks for talking with us today. You call 60° Pharmaceuticals a “Philanthropic for Profit” company. Can you explain what that means?
Hi and thanks for the opportunity to share our plans with the Solver community.
I personally believe that the goals of rewarding investors willing to take risks and achieving an important social objective are not mutually exclusive. I also think there is no fundamental reason that social missions should only be undertaken by 501cs.
From a practical standpoint it means that the company is structured in such a manner that it is feasible to seek a margin that is in line with community expectations given the kinds of diseases we are targeting. There will also be reinvestment of revenue into new neglected disease R+D. I perceive a great desire in the community for drug and vaccine makers to be more transparent about R+D costs and expectations regarding margins. We are thinking these issues through very carefully.
60° Pharmaceuticals has an interesting business model – with very few employees and a heavy reliance on open innovation and incentives to build virtual teams. What drew you to this model and how has it worked so far?
That’s an interesting story! The team I worked with to write the business plan had a very spirited debate about the Linux model versus the Microsoft model of innovation. What would work better for drug discovery? My personal perspective is that the best ideas come from the crowd, but there needs to be vision and ownership to move a product forward successfully. From a business standpoint I think it will also mitigate risk and keep costs down.
Everyone in the drug discovery and development community knows from personal experience that there is a lot of risk. We have all heard that drug development is expensive and takes a long time. I do think these factors act as a barrier to innovation, particularly for diseases where margins are going to be lower. The way out of that box is to provide a way to reimburse drug discovery and development costs throughout the value chain based on success in reaching development milestones, so that risk and reward are not such binary outcomes. The FDA’s priority review voucher is a step in the right direction, but isn’t a complete solution. Our goal at 60P is to pioneer an incentives-based approach for drug discovery for neglected diseases.
Your Challenge specifically targets dengue fever. Can you tell us about the disease and the current state of research? (more…)