SANTA CLARA, Calif. – Peter Thiel is not a fan of incremental science. The high-profile venture capital investor, who invests across technology and the life sciences via various vehicles, including the Founders Fund, suggested that as academic and government bureaucracies have scaled up and rigidified over the last 50 or 60 years, that has eroded the ability of researchers to pursue innovative science.
At a keynote address at the Precision Medicine World Conference, Thiel argued for enabling riskier research grant-making via institutions such as the NIH, as well as abandoning the scientific staple of the double-blind trial and encouraging the U.S. FDA to further accelerate its regulatory evaluations. He said that these deficiencies are inhibiting the ability of scientists to make major advances, despite the current environment that is flooded with capital and research talent.
Make science great again?
“There's a story we can tell about what happened historically in how processes became bureaucratized. Early science funding was very informal – DARPA's a little bit different – but in the 1950s and 1960s, it was very generative,” said Thiel. “You just had one person [who] knew the 20 top scientists and gave them grants – there was no up-front application process. Then gradually, as things scaled, they became formalized.
“One question is always how things scale,” he continued. “There are certain types of businesses where they work better and better at bigger and bigger scales,” he said, pointing to big tech.. “And, if big tech is an ambiguous term, I wonder whether big science is simply an oxymoron.”
He then cited the success of major scientific programs – such as the development of the atomic bomb in the Manhattan Project, the Apollo space program and Watson and Crick’s discovery of DNA – that hinged on having “preexisting, idiosyncratic, quirky, decentralized scientific culture[s]” and were accelerated rapidly by a major infusion of cash.
Thiel aims to recreate these sorts of conditions with his venture investments, identifying researchers who are not focused solely on accumulating incremental research and publications designed to ensure tenure in a highly competitive environment. He also doesn’t want those who work entirely outside existing paradigms and may be prone to going too far afield for their research to succeed.
“When I invest in biotech, I have a sort of a model for the type of person I'm looking to invest in,” said Thiel. “There's sort of a bimodal distribution of scientists. You basically have people who are extremely conventional and will do experiments that will succeed but will not mean anything. These will not actually translate into anything significant, and you can tell that it is just a very incremental experiment. Then you have your various people who are crazy and want to do things that are [going to] make a very big difference. They're, generally speaking, too crazy for anything to ever work.”
“You want to ... find the people who are roughly halfway in between. There are fewer of those people because of ... these institutional structures and whatnot, but I don't think they're nonexistent,” he continued. “My challenge to biotech venture capitalists is to find some of those people who are crazy enough to try something bold, but not so crazy that it's going to be this mutation where they do 100 things differently.”
Thiel also argued that the regulatory activity of the FDA slows innovation discovery on the backend. He said that the agency should speed up its approval process, and that it’s essentially greenlighting things that already have succeeded. He added that he can envision changes to the NIH funding processes that could accelerate innovation.
In perhaps the most interesting part of his speech, he argued that the scientific standard of a double-blind clinical trial should be eschewed, given that it is fundamentally unethical, triggers the placebo effect and encourages incremental advances. He suggested that novel advances should offer so much efficacy, that it is clearly demonstrated even without a double-blind trial.
“The double-blind testing criteria is ridiculous. It's a hack because people will know whether they got the drug or not – and you've hacked the placebo effect,” said Thiel. “That is a reason to believe that it's much more likely to get through our regulatory process if you're against double-blind studies.
“We want things that work. If things work well enough, you don't need a double-blind study,” he added. “It's probably unethical – some of us don't want a study with something that works because you're giving a bunch of people a drug that doesn't work at all. A double-blind study is a symptom.”
Thiel cited one of his portfolio companies, London-based Compass Pathways Ltd., which is developing psilocybin-based mental health treatments, as an example of the ways the requirements for double-blind trials limit advances.
Founders Fund has a handful of life sciences portfolio companies, including organ-on-a-chip-focused Emulate Inc., of Boston, and engineered cells and CRISPR tools player Synthego Corp., which is based in Menlo Park, Calif.
The fireside chat moderator noted that many of the recent major life sciences breakthroughs, such as CAR T, are prohibitively expensive for most patients and used by only a tiny portion of the population. But Thiel argued that this is no reason not to pursue them, because as the science advances, the technology becomes more in demand, and it will become cheaper and more mainstream.
“Inequality is always the alibi for people who don't want to talk about stagnation,” responded Thiel. “Certainly, one modality can be very expensive to start, and then, over time, they get less expensive. If this had been a rule, we would have never had airbags in cars.
“In the 1980s, airbags were expensive and only in cars like Mercedes or BMW,” he added. “Then people made them cheaper, and, eventually, they became more commoditized. If you had said, ‘An airbag is too expensive for everybody, so nobody should have an airbag,’ then we wouldn’t have them.”