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Prizes Eyed to Spur Medical Innovation

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Science  08 Feb 2008:
Vol. 319, Issue 5864, pp. 713
DOI: 10.1126/science.319.5864.713

MAASTRICHT, THE NETHERLANDS—If the World Health Organization offered a $10 billion award for a malaria vaccine, would that persuade major pharmaceutical companies to go after the prize? Could a $100 million prize encourage development of a reliable, cheap, and fast diagnostic assay for tuberculosis? And would those monetary awards prove to be the cheapest, or fastest, way to achieve such medical innovations?

Provocative questions such as those were at the core of a 2-day workshop* here last week addressing whether prize incentives can stimulate the creation of new drugs and therapies. For some speakers, prizes offer a chance to spur medical research on neglected diseases, including those that strike people in developing nations who can afford little health care. Others took a more radical view: A national or global medical prize scheme could eliminate drug patents, stimulate drug development, and lower escalating health care costs. “A prize is a [research] incentive, the same way a monopoly is an incentive,” says James Love, director of the think tank Knowledge Ecology International (KEI) in Washington, D.C.


Noting the long history of scientific and technological prize contests, James Love argues that a national scheme of awards for medical innovations should replace drug patents.

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Cosponsored by KEI and UNU-MERIT, a research and training center run jointly by United Nations University and Maastricht University, the workshop drew several dozen economists, intellectual-property specialists, public-health officials, and drug-development experts to discuss a concept that's attracting more attention. For example, U.S. Senator Bernie Sanders (I-VT) has introduced a bill, the Medical Innovation Prize Act, written with Love's help, that would replace medical patents with an estimated $80 billion annual award fund. Although the bill is unlikely to go anywhere now, Sanders hopes to get a Senate hearing this year to publicize the concept. “There is growing interest and political feasibility for trying prizes in a variety of contexts,” says Stephen Merrill of the U.S. National Academies, who recently examined how the U.S. National Science Foundation could set up a prize system to stimulate innovation (Science, 26 January 2007, p. 446).

Prize contests have long been used to steer efforts toward particular discoveries or technological accomplishments, and they're becoming popular again (Science, 30 September 2005, p. 2153). One well-known early success was the British government's 18th century prize to find a way for seafarers to gauge longitude. More recently, the $10 million Ansari X Prize for a private, reusable, crewed spacecraft prompted an estimated $100 million to $400 million in space-flight research before Burt Rutan's SpaceShipOne won it in 2004.

Although perhaps not as prevalent as technology competitions, medical prizes are attracting sponsors. Pierre Chirac of Médecins sans Frontières said at the meeting that his group was considering an award for the desperately needed TB diagnostic test. And in 2006, Prize4Life, a nonprofit group founded by a patient with amyotrophic lateral sclerosis (ALS), announced a $1 million prize for a biomarker that can track the fatal disease's progression—a key for any drug development. Prize4Life hopes to launch two more contests, including a $2.5 million prize for a treatment that proves effective in a common mouse model of ALS.

Such modest awards pale in comparison to the mammoth prize system Love advocates through the Sanders bill. Financed annually with 0.6% of the United States's gross domestic product—about $80 billion at the moment—the Sanders plan would give annual awards to medical innovations based on the health impact for the nation—assessed using a measurement known as quality-adjusted life years that gauges improvements in life expectancy. Instead of the government granting patents to a company, a board that would include business and patient representatives, as well as government health officials, would each year judge any new products and award their developers a share of the fund.

At the Maastricht meeting, intellectual-property specialist William Fisher III of Harvard Law School argued that prize schemes have some advantages. Patents, said Fisher, guide medical research away from vaccines, which may require at most a few doses per person but arguably have the most health impact, and toward treatments for the rich and the development of “me-too” drugs, copies of an already successful drug with just enough differences to be patentable. “Prizes can offset all three” of those biases, he says.

PhRMA, a trade group in Washington, D.C., that represents pharmaceutical and biotech firms, has strongly criticized the Sanders bill as a step toward socialized medicine. And yet it is intrigued by new incentives, if the patent system stays intact. “It's an interesting idea to add prizes for neglected diseases to the existing system,” says Shelagh Kerr of PhRMA, who attended the workshop.

Prize incentives are, however, unlikely to sweep the medical research world. Philanthropic and patient groups may offer new awards, but governments may be more cautious. “We're no longer in the Longitude Prize era. We pay scientists many millions to do research,” says David King, former science adviser to the U.K. government. “How do you decide how much money to award?” adds economist Aidan Hollis of the University of Calgary in Canada, noting that governments typically don't know in advance what social value a medical treatment will have.

The workshop itself offered an ironic morsel of evidence that prizes are not perfect incentives. Organizers offered a €1500 award for the best paper on using monetary prizes to stimulate private investment in medical research, but no entries have been submitted thus far. The contest has now been extended to mid-April.

  • * “Medical Innovation Prizes as a Mechanism to Promote Innovation and Access,” 28–29 January.

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