664. Are Thousands of Medical Cures Hiding in Plain Sight?

23:34Now we're getting into more familiar territory for me, incentives. What's so frustrating when it comes to finding new uses for old drugs is that the science is so much easier, but the economic incentives are almost totally absent. Here's how Figenbaum describes it. Once you're dealing with FDA-approved drugs, you already know how it works in the body, because it's been proven. You already know that it's safe enough to be approved for one thing. And you actually also already know that it can do something in the body that can be clinically meaningful for a particular condition, which means that it's more likely that it can also do something clinically meaningful for another condition.

24:11So you've taken it from all of this uncertainty, which is many unknowns about every molecule, And of course, 90 plus percent of drugs that are started in development will never make it to approval. So now you're dealing with just the things that they work and they hit something in the body. They're safe when they do that. They can have a clinically meaningful benefit. Oh, and by the way, they're already at your CVS. And for 80 percent of these, they're generic, which means they're also cheap. So you add all those things up and that's what we work with. And you might say to yourself, well, why aren't people repurposing drugs?

24:41It costs about 1 % of the cost to develop a new drug, to repurpose a drug and find a new use for an old drug. Of course, the economic reason is that though it's much, much, much less expensive to do it, there is zero financial upside. Even though it's going to help a lot of patients, no one's going to make any money off of it. There's this broken economic system. I just think that there's something here that's totally outside of my realm of understanding and my work. It would be so great if some really smart economists could spend some time thinking about this and maybe thinking about ways to solve it.

25:18As a matter of fact, some smart economists already have. We'll hear from one of them after the break. I'm Steve Levitt hosting Freakonomics Radio today, and we'll be right back.

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27:16We've been talking about the potential benefits of repurposing existing drugs for new diseases. That's not a new idea. Here's the Dartmouth economist, Chris Snyder. A famous case is aspirin. In the late 1800s, it was developed and used as a pain reliever. And it was discovered later in the 1900s that, my goodness, when people took aspirin, they didn't suffer from their second heart attack. Studies showed that it reduces the chance of a second heart attack by 25%. Snyder and I were in grad school together at MIT. MIT ran out of space for students. I think we had a bulge in the admits. They cleared out a windowless supply closet and they threw both of us in there, which for me was a great opportunity to be locked with Steve Levitt for a year in an office.

28:02Yeah. So you've done all sorts of great things over your career, but I would say that your latest efforts as one of the directors of the University of Chicago Market Shaping Accelerator, or MSA for short, this feels to me like it might be a legacy, the thing that you tell your grandkids about. Could you explain what MSA is trying to do? Sure. It involves faculty co-directors at the University of Chicago. That's Michael Kramer. Rachel Glenister is at the Center for Global Development, and that's where our headquarters is moved to in Washington, D.C. We decided that it was going to be easier to influence policy in Washington, D.C.

28:38than Chicago. And then there's me up at Dartmouth. We got funding from Schmidt Futures and Citadel Foundation, and they were interested in these areas of public health, pandemic prevention, and climate, big existential social issues. And the question is, how do we solve those maybe without having to break the bank? One way to do it is through innovation and saying, how can you spend a dollar of public funds to get$100 of social benefit? There are different ways to come at the problem if you're a funder. One is you can try to find the most promising inventors and just encourage them along, provide them with grant funding and push them through from the beginning of the process.

29:19The market shipping accelerator is not against that form of funding. We probably think there's too little of that anyway. But what we think is that there's an alternative, and that is to work at the other side of the pipeline. To do that, they use a mechanism that Rachel Glenirster and Michael Kramer developed about 20 years ago called an advanced market commitment. It works like Kickstarter. Governments or foundations commit to buying a product that doesn't exist yet. That That means companies can invest in creating new treatments knowing there's a buyer waiting at the other end. You dangle market incentives and the right parties who are going to actually have the best ideas will, in a sense, self-organize, just as markets often do, and bring themselves to the pipeline to try to get that reward at the end.

30:02You can think of the push funding as a payment for attempt and pull funding as, in a sense, payment for success. In 2004, Glen Erster and Kramer proposed an advanced market commitment to stimulate research on vaccines in poor countries. Schneider joined the team, and they got to test their academic theory out in reality a few years later to try to develop a more affordable pneumococcal vaccine, which prevents pneumonia, meningitis, and sepsis. The pneumococcal vaccine advanced market commitment, it was picked up by the Gates Foundation, and they organized finance ministries from five different countries, and this global alliance for vaccines and immunizations, it's come to be called GAVI, was part of the administration of it.

30:46And it turned out to be a$1.5 billion fund. And how many companies tried to go after this$1.5 billion in payouts that were sitting there? There were two. There was Wyeth that was then bought by Pfizer that had the existing vaccine. And GSK was developing one that had even more strains that would have qualified under this program. Then the Serum Institute of India came in probably halfway through the program. And actually, the prices did come down with the entry of Serum Institute. They came down quite a bit. And have you tried to estimate in the end the return on investment to this advanced market commitment?

31:24The second-generation pneumococcus vaccine has been credited over that period of time with saving 700 ,000 lives of children under five. It really hits any mark you want for cost-effectiveness. Prevnar was the first generation vaccine that was sold in high-income countries. This is the next generation that was going to conjugate more strains into that vaccine. This sits close to home. My own son Andrew died of pneumococcal meningitis just like a year or two before Prevnar got approved. And Prevnar would have been just the thing that probably would have saved his life. I think about that when we talk about the pneumococcus vaccine.

32:02Yeah. Yeah. So this was a big success, I think. Almost anyone would look and say, hey, this worked exactly as we hope, maybe even better. But this was launched in 2009. And as far as I know, there weren't any other big market commitments like this done until COVID. Is that true? And what do you think that seeing the success here didn't spur governments to latch onto this more quickly. I think that is true. There were some other limited programs. I worked on one for multi-drug resistant TB, but it's on the order of several million dollars, not in the billions. If you think about, say, innovations that are going to help developing countries, I think that after the global financial crisis, all the countries in high-income areas were cutting back their aid budgets.

32:51So I think that's part of it. And then, you know, we had COVID hit, And then we're thinking, like, how do we get out of that pandemic? So governments made huge advance commitments to firms developing COVID vaccines. And at least to an outsider like me, the COVID vaccine development felt like a stunning success. Incredibly fast times from idea to ramping up manufacturing to a global scale. Is the true story as good as it appears? And you give a lot of the credit to these advanced market commitments? I think the story is miraculous, really. When COVID hit, Michael Kramer got some calls because people are wondering, you know, who knows something about international funding programs for vaccines?

33:32Well, Michael Kramer's brainchild was this pneumococcal advanced market commitment. And whose name do we know? And, well, Michael Kramer won the Nobel Prize in economics. So he was getting a lot of calls from all over the world saying, you know, what do we do? How much should we invest? And certainly policymakers had the intuition, like, this is a big problem. We should invest a lot of money. We said over and over again, paper after paper, and made call after call, like, yes, you can't spend enough money on developing these vaccines. You're losing trillions of dollars every month in morbidity, illness, death, and the closure of your economies and schools.

34:10So you should invest billions to save trillions, obviously. With Operation Warp Speed, there was push funding. Basically, all the companies except for Pfizer, their facilities being scaled up and R &D costs, they were all covered by the government. And also these pull commitments to buy the vaccine, even though they hadn't been approved yet, were being signed. So they're doing both and that either or. And that seems sensible to me in such an emergency. So when you launched the Market Shaping Accelerator in 2023, I'm curious, you had this powerful tool. You knew it could work. Did you have a whole long list of applications where you already knew you wanted to apply it?

34:51Or was it more you were searching for ideas to try to figure out where to go next? So to announce ourselves, we took$2 million of our startup funding and we put it toward, it's kind of a meta idea, but let's use pull funding to try to pull fund the best ideas for pull funding mechanisms. We use the money to provide prizes and milestone payments for the best ideas for neglected areas that might benefit most from these market-shaping interventions. We got about 190 submissions from all across the world from some really serious players, which we winnowed down to three finalists. And one of the finalists is this program for generic repurposing.

35:32It was actually an idea submitted by a lawyer named Sava Kerdamilides. This kind of blows my mind. There's a lawyer out there who proposed this idea, which is now working its way towards having, if we're lucky, a trillion dollar impact. That doesn't actually happen in research. Do you agree? a lay person had an idea that is turning into something that is really, really going to matter. It sends a great message about a concept that I push all the time, which is that nobody's got a monopoly on ideas. Even people like Michael Kramer, who have great ideas, don't have that many great ideas. And finding a way to let regular people express these ideas is a powerful, powerful, very democratizing force, which is really great to see.

36:28It's part of the idea of market shaping in a way that we don't necessarily have all of the answers. Okay, so repurposing generic drugs. What's the problem here that needs to be solved? There are plenty of incentives to develop the initial drug. We have a patent system. You get to sell these blockbuster drugs to patients and insurance companies and pharmacies, and you can make billions of dollars. And the inventor of that branded drug they have incentives to find other uses if that expands their market. The trouble is that that's true for branded drugs, but not for generic drugs. Once a drug goes off patent, essentially any incentive to come up with new uses and to do the clinical trials, those incentives drop off a cliff.

37:11What's interesting about that is we have laws that are trying to incentivize people to do it. So if you come up with a brand new use for an existing pharmaceutical compound, you can get a patent that covers that use. The problem in practice is that it's completely unenforceable because let's just say Viagra turned out to be a great drug for fighting cancer, which it isn't. But let's say it was a$500 billion market. The problem is when a doctor writes a prescription, they don't write a prescription that says, this is a prescription for Viagra for cancer. They say, this is a prescription for Viagra.

37:48And when they fill it, they'll just fill it with the generic drug, not with the drug that's covered by the patent. And the only way to enforce it would be to do lawsuits one after another against every doctor, which, of course, would be terrible publicity and impossibly difficult to do. It's not that people don't realize and haven't written laws to try to help it. It's just that the laws we've got in place have not worked empirically at all. Yeah, you can get a patent on new uses for drugs and new uses for generics. The trouble is, as you say, you can't monetize it. So the Market Shaping Accelerator, along with researchers from the Duke-Margolis Institute for Health Policy, have spent the past three years developing a proposal where the federal government would offer pull funding to encourage more research into new uses for generic drugs.

38:38We think this would cost roughly$1 billion per successful opportunity. That's Saren Chathik. He's a senior policy analyst who works with Snyder at the Market Shaping Accelerator. Here's how Chetek describes their poll funding proposal. First, a funder like Medicare, Medicaid, or the NIH would promise a reward if companies successfully discover and prove a new use. So this reward would be based on impact. For example, whoever the funder is could say, we've assessed that every year that someone uses this drug, it saves Medicare$2 ,000. So now we have this drug that's successfully been repurposed and a impact metric per patient.

39:22Next, the manufacturers would sell the drug for the new use. And then each year, the funder, say Medicare, would measure the adoption of that drug for the new use, and they would pay the company based on the impact. Let's say 50 ,000 patients take it that year. And as we said, the estimated savings are$2 ,000 per patient. then this would imply savings of$100 million. And so they would pay the company some percentage of that. So as long as the promise of that payment is enough to justify running the clinical trials, companies will make the investments and run them in the first place. Will this ever happen?

39:59We've had promising conversations, no commitments yet. HHS, Health and Human Services, has made this a priority on a higher level. There was a health and human services strategy report that was released in September, and it had, I don't remember exactly, but maybe 30 priority areas, and drug repurposing was one of those areas. And here again is the Dartmouth economist, Chris Snyder. I think there's a chance here. We'll work with whatever agencies want to work with us to iron out the wrinkles in the program and to start specifying what the program looks like. We are definitely trying to hit a home run here.

40:36we would want this to be a really broad and systematic solution for drug repurposing. Maybe I'm wrong about this, but I don't think small necessarily means easier. Governments have time constraints and many government officials want to have a lot of impact. So we're hoping that's the case with this. That, in my opinion, is a fantastically clever idea for how the U.S. government could incentivize drug repurposing. And one big advantage of it is that it doesn't cost the government a penny unless it works. Coming up after the break, we'll hear about what it's like working on drug repurposing from inside the government.

41:19Generally, the phrase that's thrown around is it's not considered sexy enough. Right? So I think that's a fundamental problem.

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43:51We heard how some economists think the U.S. government should encourage pharma companies to make groundbreaking discoveries of new cures from existing drugs. But even when those discoveries are made, getting them actually adopted by doctors is its own challenge. On average, it takes 17 years for a new medical advancement to be adopted. That again is Heather Stone from the FDA. We heard from her at the beginning of this episode. And that's probably a promising estimate for many repurposed drugs where there's no commercial incentive and so there's no real marketing around them. Stone has been thinking about and working on drug repurposing for practically her whole life.

44:33My mom was an infectious disease doc and I often saw her face patients with diseases that did not have any approved treatments. At that time, you phoned up your mentor, your colleague, and asked them what they had tried or how they would approach it. That was how information was disseminated. I remember the inordinate amounts of time that were spent trying to find solutions to help these patients. And then I myself, we joke that I'm like the repurposing test case. I have benefited enormously from repurposed drugs with my own health issues. I'd love to hear that story. Let's see, where to begin.

45:14I have a chronic pain condition, probably fibromyalgia, but it's kind of a diagnosis of exclusion. It began in high school, and by the time I was in college, I could barely get out of bed, and actually almost dropped out of college because of the pain and fatigue. Eventually, a drug called Lyrica, which had been approved for diabetic neuropathy, patients started reporting that those who also had fibromyalgia noticed really large improvements in their fibromyalgia symptoms when they were taking it for diabetic neuropathy. So I was put on that drug. And that has been a treatment that I've been on now for almost two decades.

45:56And it's really the reason that I'm able to do the job that I do today. So you have been instrumental in creating something called CureID. Could you just describe what CureID is? CureID is a treatment registry. It operates as a website and a mobile application that allows patients, caregivers, and clinicians to all share their treatment experiences with repurposed drugs and then to explore what others have tried. It makes the data all openly available to everyone to see. Let's say I go to CureID and I type in toxoplasmosis. What will I see? You would see all of the cases where clinicians or patients or their caregivers have submitted their treatment experiences with the drugs that they have tried for toxoplasmosis.

46:43They will be able to see whether those drugs were effective or not in individual patients and then as a whole, or whether they were not effective or had side effects that perhaps led them not to be used. and then you can go each layer down to see the full details that were submitted for each patient about their treatment experience. And what is the scale now of CUREID? How many entries are there in the database? There are about 700 clinicians submitted cases and about 600, 650 patients submitted cases or caregivers submitted cases. There are approximately 5 ,000 cases that we've extracted from the published literature.

47:25And then there are 115 ,000 cases that we have extracted from electronic medical records, but those are specific to acute COVID-19. So if you think about it from maybe a skeptic's perspective, what you're asking for with CureID is you're asking practitioners to do something that is going to help someone else, but doesn't really have any career benefit. It's an act of goodwill on the part of the clinician or the patient who enters the data. So if you would talk to economists, you'd say, well, it wouldn't be that surprising that it would be hard to get doctors to report outcomes. Did it surprise you, though, when you launched QIDA, just how hard it was to get people to make entries?

48:07It did and it didn't. You're absolutely right. There is an incentive problem. and it's something we've worked very hard to try to figure out what is in it for the clinicians and also part of why we pivoted to patients and caregivers sharing their experiences. I think the answer to what is in it is that it creates sort of a virtuous cycle where they then get information that is important to them and the treatment of their patients by reading what others have tried. As with sort of any social media platform, you have to get the ball rolling and it's been difficult to do that. The feedback that we had received was very positive.

48:46People thought this was a brilliant idea and that they thought that there was an enormous need for this kind of platform. They certainly recognized that people would potentially be resistant to taking the time to share their experiences or might have other reasons for not wanting to share them. But I don't think we recognized just how difficult it would be. As I listen to you talk, I can't help but think about how different your approach to saving lives via CureID, how different it is versus business as usual at the FDA, where drug approvals require the carrying out of costly, time-consuming, randomized experiments to prove the safety and efficacy of the drug therapies.

49:30I suspect for that reason alone, probably other reasons too, you likely faced a lot of resistance within the FDA as you worked to getting CureID launched. Is that a fair statement? Yes. It's been challenging to persuade people of the utility of the platform and to acknowledge its limitations. We don't think that a drug should be approved based on the data in CureID. That's not its intent, and it's not designed to do that. What it's designed to do is to generate hypotheses. that can then be studied in more robust clinical trials or observational studies. We can't tell from these cases alone for sure whether a drug is helping or not.

50:11The idea of pull funding, so the idea is if a firm went in and got FDA approval for a new indication for a drug, that the way they'd be compensated would be after the fact by going and looking in the data and saying, how much good is this drug doing in this new setting? And the obvious people to make that decision would be the people who run Medicare and Medicaid, because they're the ones who are spending the money and they can see the patient outcomes. That strikes me as a really radical idea, a very different way of doing business. I love the idea, but I worry that public entities would just look at that and say, no way, that's impossible.

50:54I think it's a really interesting idea. I think it would be difficult to implement. It's not clear to me that we have a way of effectively making those kinds of assessments. I mean, maybe CMS does. It's outside of my scope of expertise. I think the general premise of poll incentives is something that has worked in other similar areas. And so from that sense, it's not a totally radical approach, but some of the details of the implementation are different enough that it's hard to know whether it would be possible. I know you probably don't know the numbers off the top of your head, but just guessing, what's your medical research dollars are currently going into drug repurposing?

51:38And just in your own opinion, what would be the right share? If I had to guess, I would say a fraction of 1%, like incredibly small. What is the appropriate fraction? Maybe 10%. I mean, I really don't know. It depends on the value that you can gain for society from it. Obviously, there is enormous value that is gained from the development of novel treatments and from understanding of basic biology. But I think that there is a lot of unrecognized value in identifying existing drugs that could be treatments for diseases that have really large morbidity and mortality. It's very difficult for repurposing research to compete with novel drug discovery, for example.

52:25Generally, the phrase that's thrown around is it's not considered sexy enough. Right? So I think that's a fundamental problem.

52:38There is one person who's trying to make drug repurposing research sexy, David Fagenbaum. His organization, Every Cure, has already raised some serious dollars from the federal government and also from foundations and philanthropists, including Ted's Audacious Project, John Arnold, and Mark Zuckerberg. We've now raised over$100 million, which is just transformative to be able to direct towards drug repurposing when you consider that this has really been so neglected over the years. But also, typically it costs between$1 and$2 billion to make one drug. So$100 million is much less than it costs to make even one drug.

53:15But we're able to go a long way with that because the drugs are already approved, they're already available. and with the$100 million that we've raised, we anticipate being able to treat 15 to 25 debilitating conditions in the next five years. So you've raised a bunch of money and hopes for what you're doing are sky high. Do you ever wake up in the middle of the night and worry about the fact that maybe it's just not gonna work that well, that in the end, it'll be a disappointment? I probably should wake up and worry about that. But what I actually worry about all the time or just the people that are waiting for our drugs, that there's a drug that could help them and there's someone suffering right now and we haven't found it yet.

53:55I walked past the CVS when I was coming here today and I thought to myself, what drugs are in there on that pharmacy shelf and who is suffering right now in Philadelphia, let alone anywhere else in the world, that could benefit from one of those medicines that's not on that medicine? I'm fortunate enough to have been one of the lucky ones that got on one of these medicines that wasn't made for me and I'm here. So I'd sure as hell better spend the rest of my life looking for more of these things for more people. I think back to that final promise I made to my mom that I was going to become a doctor, discover drugs in her memory.

54:29And maybe if I got really lucky, I could develop one drug for one disease, and that would just be a pinnacle moment in my career. never in my wildest dreams could I have imagined that my own personal experience would open my eyes up to the simplest, highest ROI, lowest cost way to help people in a way that hadn't been done before. The worry for me isn't, will we meet expectations? The worry is just 100 % that person that's waiting for that drug that we haven't found yet. And how can I engineer our system and our program so that we find that drug in time for that person so they don't suffer when they don't have to.

55:12That again was David Fagenbaum in conversation with Steve Levitt. Thanks to both of them, as well as Heather Stone, Chris Snyder, and Saren Chuthik. You'll be hearing more episodes down the road with Levitt as host. Meanwhile, coming up next time on the show... I see an educational system that immediately rewards you for everything. Ah, great job. There's no way to tell a kid, well, this wasn't really good work, but I know you can do better. And why don't you work on this? Bring it to me tomorrow. And all of a sudden you have a good one. It's a philosophy behind education and make the children happy instead of making them strong, just for God's sake.

55:59Make them strong guys, strong young women. And they will like it. They will like it. We will hear from the filmmaker, writer, and self-styled philosopher Werner Herzog. That's next time on the show. Until then, take care of yourself. And if you can, someone else too. Freakonomics Radio is produced by Stitcher and Renbud Radio. You can find our entire archive on any podcast app. Also at Freakonomics.com where we publish transcripts and show notes. This episode was produced by Alina Cullman with help from Zach Lipinski and edited by Gabriel Roth. It was mixed by Jasmine Klinger and Jeremy Johnston.

56:37The Freakonomics Radio Network staff also includes Augusta Chapman, Dalvin Abouaji, Eleanor Osborne, Ellen Frankman, Elsa Hernandez, Ilaria Montenacourt, and Tao Jacobs. Our theme song is Mr. Fortune by The Hitchhikers and our composer is Luis Guerra.

56:56I'm so sorry to be running so late. I'm a 30-minute walk and apparently also a 30-minute Uber.

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58:50story of how we got to this moment. Find a history of the United States and 100 objects on the 99 % Invisible feed, wherever you get your podcasts.