Andrew Lo advocates funding a diverse portfolio of drug candidates. By taking “multiple shots on goal,” the high risk of individual failures is mitigated. The immense success of just one or two approved drugs can financially cover the costs of the entire portfolio, making early-stage biotech investment more viable and rational.
The Children's Tumor Foundation succeeds by acting as a trusted, neutral party. It overcomes the conflict between pharma's need for secrecy and academia's drive to publish. By convening industry, researchers, and regulators around a shared patient-focused mission, the foundation forges partnerships and accelerates development in a way for-profit entities cannot.
A practical way to find potentially abandoned drug assets is to scan the public ClinicalTrials.gov database. Andrew Lo suggests identifying trials that are still listed as active but have not been updated for a significant period. This public data provides a scalable, low-cost starting point for discovering valuable candidates that pharma companies are no longer pursuing.
A key organizational flaw prevents valuable shelved assets from being repurposed. In large pharma, actively managing and out-licensing these candidates is not a defined role. Business development is incentivized to in-license new assets, while R&D leaders focus on the active pipeline. This structural gap leaves valuable drugs in corporate limbo.
To successfully acquire a shelved asset from a large pharma company, you must find a high-level internal advocate—what Annette Bakker calls a "Frida." This person must believe in the project and possess the influence to navigate internal bureaucracy and champion the out-licensing effort, which is often complex and not a corporate priority.
Shelved drugs aren't a monolith. They typically fall into four categories: 1) dropped due to a strategic shift, 2) orphaned after a biotech acquisition, 3) returned to a small company after a partnership ends, or 4) legally inaccessible after a company's bankruptcy. Understanding these archetypes is key to tailoring a rescue strategy.
The Priority Review Voucher (PRV) program creates a compelling business case for ultra-rare diseases. The voucher, sellable for over $100 million, can provide a significant return to investors on its own. This financial incentive is so strong that a company could theoretically give the resulting drug away for free and still be profitable.
The ultimate vision is a dynamic marketplace where pharma companies routinely list their shelved assets. This "eBay for drug candidates" would allow interested parties—from biotechs to patient advocacy groups—to access information, assess opportunities, and bid on developing these assets, creating a systematic and efficient repurposing pipeline.