VitaDAO Newsletter February 2022
Creating legal agreements between two parties for (pre-patent) biopharma assets is complicated, in-transparent and lengthy. Molecule is proposing a new kind of marketplace for early-stage biopharma IP through which stated IP can easily be bought, funded and collaborated on. This marketplace needs to enable transparent IP rights and legal agreement construction, meanwhile accounting for the sensitivity of early-stage IP. Molecule is utilizing the power of Ethereum and NFTs to standardize the process of creating and transacting around the early-stage biopharma IP: The IPNFT is born.
Introduction
Globally, early-stage biopharma research suffers from chronic underfunding leading to discontinued research in the early stages of the pharma development cycle. This is happening so regularly that academia has coined the phase of research up until clinical trials the “Valley of Death”. Researchers struggle to acquire funding due to three distinct reasons:
- Lack of visibility and connection to relevant investors: Researchers struggle to connect and acquire funding from private investors
- Legal complexity of IP deals: Deals such as license agreements surrounding pre-patent and patent IP are complex and often need legal support
- Difficulty of determining the value of early-stage biopharma assets: Both funders and researchers have trouble assessing the value of early-stage research.
NFTs have created an unprecedented revolution in the creative space, rethinking copyright, royalties and IP. We believe it will also be instrumental in solving the above-stated problems. In this article, we are going to focus on the first technical implementation of a biopharma IPNFT. It builds on many concepts other influential thinkers in the Web3 space have conjured in the past. For example, if you are interested in how general IP can be combined with NFTs have a look at Trent McConaghy 3 part series on building IP NFTs with ERC721.
“When examining the transactional market for biopharma IP, one aspect becomes immediately obvious: IP is not sold in a simple purchase agreement like houses, cars or other physical objects. Transactions involving biopharma IP always differentiate between the specific rights and relating terms of the purchase.”
The complexity of biopharma IP deals
When examining the transactional market for biopharma IP, one aspect becomes immediately obvious: IP is not sold in a simple purchase agreement like houses, cars or other physical objects. Transactions involving biopharma IP always differentiate between the specific rights and relating terms of the purchase. Therefore, it is common to use license agreements to structure the terms surrounding the IP. Terms may include exclusivity, applicable territory, relating IP, grants of rights, financials and much more. This is relevant for the technical implementation of the IPNFT transactions as no biopharma IP will ever be sold without negotiating and determining the terms relating to the transaction.
