Biotech Rules Part I: Anyone Wanna Buy a Cure for Cancer?

Biotech Rules Part I: Anyone Wanna Buy a Cure for Cancer?

Biotech Rules Part I: Anyone Wanna Buy a Cure for Cancer?

Hal Plotkin, Special to SF Gate
Tuesday, February 16, 1999


I’ve got my fingers crossed for Dr. Judah Folkman, the Boston researcher who captured world attention in 1997 when his anti-cancer drugs made tumors shrink in mice.

To his credit, Dr. Folkman is keeping a pretty low profile these days, despite having had his experiments successfully replicated by the National Cancer Institute. It’s an unusual posture for someone in his field. Makes me think he might really be onto something.

Then again, he might not. Folkman’s discovery could turn out to be just another biotech boomlet that goes bust. Mice, as Folkman himself notes, are not men (or women).

But that fact hasn’t stopped the Great Biotech Hype Machine. Hardly a day goes by when we don’t read tantalizing stories about similar biotech “breakthroughs.” Unfortunately, we usually have to read the last paragraph of such stories to learn that the news is often highly speculative.

What’s behind the blizzard of biotech hype? In a word, privatization.

An obscure law passed in the early days of the Reagan administration, the Bayh-Dole Act, granted the recipients of federal research funds, mostly academic institutions like the college hospital where Dr. Folkman works, ownership of discoveries that arise from their investigations.

Taxpayers foot the bills for the experiments. But when lab work yields commercially viable products, the schools are then permitted to sell commercial rights to the company or companies of their choice.

Supporters of the Bayh-Dole Act say it was designed to avoid a biotech version of the tragedy of the commons. That is, if no one owns something, no one takes care of it.

A coalition of lefties, who have a hard time saying no to any request from colleges or universities, and righties, who love privatizing public assets, made the Bayh-Dole Act an enormously popular piece of legislation.

Bayh-Dole helped unleash the current tidal wave of biotech hype. How does an academic institution get a company interested in buying rights to commercialize a new discovery? The answer is found, increasingly, in our daily newspapers. Premature announcements. Untested hypotheses. Unverified results.

As a consequence, the scientific process is beginning to resemble a snake-oil selling contest. Lost in all the hoopla that has ensued since publicly funded research was privatized is the question of whether it really makes sense to grant any one company exclusive rights to benefit financially from research we all paid for.

The theory behind allowing the exclusive privatization of publicly funded research was that it would speed the growth of the biotech industry. In practice, though, it may be doing exactly the opposite, press releases notwithstanding.

On the positive side, drug companies have, as promised, poured millions of dollars into university coffers, purchasing licenses for everything from gene-splicing techniques to designs for artificial organs.

For-profit companies say assuring them of a monopoly license to sell whatever products are created makes them much more likely to invest the money it takes to commercialize laboratory research. To be sure, some important new biotech products have been brought to market as a result.

On the other hand, privatizing publicly funded research encourages the companies involved to work in secret. And while winning monopoly licenses may, in fact, induce drug companies to invest more, the same can be said of any industry. Why don’t we grant one company a monopoly to make cars? Surely that company would make larger investments in developing new automotive technologies, no?

The argument that drug companies can’t protect their investments without exclusive licenses rings hollow. Even without exclusive licenses, drug companies remain free to patent any inventions or processes they create when they bring new biotechnology products to market.

What’s more, the academic biotech hype machine, designed primarily to attract well-heeled potential licensees or, even better, to start a bidding war, has inadvertently tricked many smaller investors into betting their portfolios on flash-in-the-pan biotech companies or on biotech mutual funds, many of which have performed poorly in recent years.

Even worse, hundreds of thousands of people suffering with terminal or chronic diseases have discovered that the gap between the biotech PR they’ve read and biotech reality is often as big as the Forest Lawn cemetery.

Just when the Internet has made real-time scientific collaborations easier than at any time in history, our federal government is nurturing an industrial model for biotech that retards collaboration. It’s hard to understand how we’ll get better biotech products — more cures for what ails us — if fewer scientists are involved in the process.

For instance, I have to wonder if just one Bayh-Dole empowered company, EntreMed, the small Maryland biotech firm licensed by Dr. Folkman’s employer, should be permitted to commercialize his research?

Assuming Folkman’s findings are correct, how many people will die while we wait for that one small company, or the partners it selects, to figure out the remaining details? Wouldn’t it be better if publicly-funded research was made fully available to the public, and to all interested commercial entities, with all relevant details, as quickly as possible? Wouldn’t science work better with more competition, and with more opportunities for collaboration?

Academic teams do a great job of researching every subject under the sun except, of course, the impact their revenue streams have on their own operations, their organizational ethics, and internal cultures. It’s possible, I suppose, that we really do need to do what Bayh-Dole aimed to do: establish some new way to reward scientists and perhaps, even their institutions, for breakthroughs that are achieved.

Humanity’s best thinkers, however, have rarely been bothered by such concerns. When the last century’s most prominent cancer-treatment pioneer, Madame Marie Curie, discovered radium’s properties in 1899, she and her husband flatly refused to apply for a patent.

Despite living in poverty, they were more interested in enabling other scientists to find applications for her discovery, which she called “radioactivity,” as quickly as possible.

For Madame Curie, as for Isaac Newton before her and Albert Einstein after, understanding nature was not a business. It was a science.

About the Author /

My published work since 1985 has focused mostly on public policy, technology, science, education and business. I’ve written more than 600 articles for a variety of magazines, journals and newspapers on these often interrelated subjects. The topics I have covered include analysis of progressive approaches to higher education, entrepreneurial trends, e-learning strategies, business management, open source software, alternative energy research and development, voting technologies, streaming media platforms, online electioneering, biotech research, patent and tax law reform, federal nanotechnology policies and tech stocks.