Crowdsourcing Drug Development

Crowdsourcing has proven highly effective in bringing many minds to bear on a range of problem to be solved, though often for issues as simple as a logo design. That power of course can be brought to bear on problems far more complex. The National Institutes of Health, following the lead of a program begun in Great Britain, will begin on October 1 providing grants to researchers to allow them to attempt to find new uses for drugs abandoned as ineffective for their original intent by companies such as Eli Lilly, Pfizer, and AstraZeneca. History has shown that some drugs found ineffective for treating the ailment originally targeted can be highly effective against other conditions. The drug AZT is one such drug, originally designed for cancer but now used against AIDS. NIH is making $20 million available in grants for researching new uses for about 20 drugs initially, but hopes to expand the program. Persons conducting this research will have the benefit of millions of dollars already expended by the major companies to determine, for instance, safe dosage levels. Sounds like a win-win-win to me. The program is being run by NIH's new National Center for Advancing Translational Sciences.

FDA Unique Device Identifier

Those of you developing a medical device should, if you have not already, familiarize yourself with the FDA's new "Unique Device Identifier" (UDI) identification number and barcode system for medical devices. The purpose is to enable the FDA to search databases of statistics from hospitals, insurance companies, etc. on failure rates and other problems with medical devices. The FDA's website has more information, including several slide presentations and notice of a public seminar on UDI to be held in Bethesda, MD on September 12th and 13th.

JOBS Act Update

Well, the Jummpstart Our Business Startup (JOBS) Act (Don't ya just love the clever name???) has passed both the House and Senate and Obama has said he will sign it.

One of the most important provisions for entrepreneurs is that it makes crowdfunding legal. This can make it far easier for startups to raise money.

However, I want to reiterate a point I made in an earlier post, and that is this: Just because you can raise money through crowdfunding does not mean you should raise money through crowdfunding. If you are sure that you can raise the entire amount that you will need through this method, then maybe (just maybe) you should consider it, despite the drawbacks. If you will need to later approach sophisticated investors for large amounts of capital, having a bunch of small crowdfunding owners could be like having an anchor tied to you.

Be sure you understand all aspects of raising investment capital before you make the crowdfunding leap!