Public Health @ VitaDAO: Using Democratized Wealth To Democratize Health
On the wealth and health of nations
There is a striking correlation between the health and the wealth of nations. For example, as life expectancy rises in a country so do economic measures like its per capita gross domestic product (GDP). These increases have been in tandem over the past centuries and are causally related to our investment in our health via sanitation, antibiotics, vaccines, etc. Meaning, it has taken our wealth to improve our health.
Many of the healthiest and wealthiest nations are democracies. A democracy is an organization governed by people that reside on land owned by the democracy. Though people living under democracies have higher living standards than ever in human history, the plateauing of life expectancy gains despite continued per capita GDP gains demonstrate the limitations of existing forms of government. In a dramatic example, in the US, in what some consider democracy in its strongest form, life expectancy is increasingly lagging behind other high GDP countries to the point where it’s now even declining.
Health and wealth for individual countries over the last 200+ years
To pinpoint the reasons for life expectancy plateauing in countries we need to look both within and beyond their borders. First, within the borders of many successful democracies the health and wealth gains are disproportionately accumulated by specific groups. The well known expression “socialized losses, privatized profits” summarizes the view. For example, certain ethnic groups lack access to health care as other groups have. Also, organizations owned by a few, e.g., pharmaceutical companies, capture a disproportionate percentage of the value of work funded by the many, e.g., NIH. Second, the health-wealth creation is disproportionately restricted to those within the borders of those who create it. See for example the COVID pandemic where the data suggests that vaccine-producing countries are prolonging the pandemic for themselves by not distributing it to those who don’t have access. These issues demonstrate the failings of health and wealth access being based on the land on which one is born.
Health care, arguably more than any other industry, sheds light on the core inefficiency of meatspace (a.k.a., land-based, real world) democracies — their difficulties in managing their assets. Fortunately, over the last decade a new type of democracy based on blockchains has emerged. The blockchain equals country analogy makes sense because a country is, in essence, a collection of assets. With a blockchain everyone’s assets fit neatly on a computer spreadsheet where everyone can easily agree on who owns what. Whereas with a country everyone’s assets are scattered over physical distance and it can often involve large time and financial costs for everyone to maintain their ownership.
Digital > Physical
Just like we’ve seen computers do with many things in the physical world — e.g., online stores vs. brick-and-mortar stores — blockchains have several advantages over countries. A key advantage of blockchains is their accessibility. They allow significantly more opportunity and control than what traditional databases managed by centralized organizations can provide. Blockchain assets are highly ‘liquid’ — they ‘flow’ where they are most needed, i.e., where the most upside is available. Blockchains are also permissionless, which means anyone can use them. Contrast this with traditional asset managers, which typically restrict their access to already wealthy people. Thus, blockchains present a new way to democratize wealth and this potential is increasingly appreciated. The role of Bitcoin in El Salvador and Nigeria are notable examples here. Behind the scenes the peer-to-peer architecture of blockchains enable individuals to transact value independent of where they are on earth without needing to trust potentially unreliable third-parties such as banks or government treasuries.
While peer-to-peer transactions are at the core of blockchains, most of the progress of our species hasn’t been made by individuals. It has been made by people taking collective action. Humans thrive because we pool and then allocate our resources. Said another way, we govern ourselves. Blockchains make possible several new types of governance structures. Notably, a decentralized autonomous organization (DAO) is a new type of blockchain-based governing body. In a DAO, code is law and consensus rules.
The efficiencies of computer-augmented organizations over human-only organizations are well documented. Think of how organizations benefited from replacing paper documents with office productivity software. The code that drives DAOs goes the key step further by turning its collective knowledge into collective action. In doing so, it tackles a fundamental issue of meatspace governance — mis-alignment of people’s resources. In meatspace, people vote on intermediaries (e.g., representatives) who then vote on allocating resources. Setting aside the substantial time and cost sink of voting on intermediaries, it’s not possible for an intermediary’s decisions to accurately represent each person’s wishes. This mis-alignment of interests is solved by a DAO because with a DAO: 1) each person themselves votes on how resources are allocated and most importantly 2) each person votes with their own resources. Thus, there are no intermediaries, and the more people put their resources behind a project, the more likely the DAO will do that project. DAOs enable what no meatspace can do — everyone simultaneously putting their money where their mouth is.
Most DAOs to date have focused on financial applications, and thus on wealth creation. Given that wealth leads to health, can we imagine a DAO where people use their wealth to improve their health? The goal of VitaDAO is just that. Specifically, VitaDAO enables anyone in the world to fund and participate in projects that promote life expectancy gains, a.k.a., longevity.
VitaDAO wants to steepen the slope of the health-wealth curves for all countries. Currently, funding for biomedical research and drug development comes from investment firms, non-profits, and companies. How can VitaDAO improve upon what these organizations do? Recognizing that innovation usually builds upon existing frameworks, the most near-term solution for VitaDAO is to work hand-in-hand with these organizations. This means investing in improving their existing infrastructure.
VitaDAO Aim 1. Improve the yield of existing public investment in longevity projects
The point of time and place where technology fails is often referred to as the “valley of death”. This is the point where no-strings-attached funding fails to link up with profit-motivated funding to bring a project to market. Surprisingly, one of the largest valleys of death lies around our world’s universities. Currently a huge percentage of university developed technologies go unutilized. If one could more efficiently bridge non-profit and for-profit funding, this could improve the yield of existing public investment.
What would this bridge look like in practice? At the center of new medical technology are patents. Biotech patents exist because it is expensive and time-consuming to develop new treatments. Patent holders need to protect their investment of time and money until they are able to make a return on them. Though, what if universities could profit off their patents from the time of invention or better yet before the invention was made? This is now possible using a IP-NFT marketplace (intellectual property — non-fungible token) built by Molecule. Traditionally, intellectual property (patents and data) sit on computers waiting to be monetized. Unfortunately, selling anything takes time and skills that inventors often don’t have. Universities aren’t natural sales people either. Among other tools to fund research, VitaDAO intends to leverage Molecule’s IP-NFT marketplace to help these groups monetize their assets. Some early VitaDAO enabled university IP-NFTs from the University of Copenhagen (Denmark) and Newcastle University (UK) are described here and here, respectively.
The above approach can be thought of as building bridges to fix existing roads. These are efforts in series. In parallel, one can also imagine building new roads. With more roads, more people can participate in improving their health as well as the health of others.
VitaDAO Aim 2. Enable democratic participation in longevity projects
While patents are critical to modern medicine, historically many important medical advances, such as antibiotics and vaccines, were made possible without patents. We need to make a distinction between new technology, where inventors rightfully benefit from their efforts, and existing technology where incremental advances drive much more profit than patient benefit. The latter is what we want to avoid because of its flattening effect on health-wealth curves. A famous example of this involves insulin. The original insulin patent was given away such that it could be made cheaply and widely available. Unfortunately, over the last several decades pharma manufacturers have creatively generated new insulin patents and lobbied governing bodies, which significantly increased insulin prices to the point where many people no longer can afford this life-saving medicine. Thus, tragically we now have a crisis for something that had been a solved problem for almost 100 years now.
VitaDAO will step in here by facilitating initiatives where intellectual property isn’t relevant. Researchers and pharma companies focus on patents, but there are other participants in healthcare who don’t view success through the lens of patents: namely, patients and health care providers and insurers. For patients, what a patent-less scenario can look like is crowdfunding where the R&D work is funded by those interested in the treatment. For providers and insurers, what a patent-less scenario can look like is social impact bonds (SIB, a.k.a., pay-for-success financing), where organizations pay because their patients get healthier and this makes their performance better (providers) or reduces their payouts (insurers). An early VitaDAO SIB initiative enabled by Crowd Funded Cures is described here. NFTs might not make sense in either of the case of crowdfunded research or SIBs, but VitaDAO can still drive success, e.g., by distributing its $VITA tokens to those based on their contributions.
Fix the money, fix the world
Internet pioneer Marc Andressen famously said, “Software is eating the world”. This was a powerful slogan that catalyzed the ambitions of many Web2 entrepreneurs. Unfortunately it also anthropomorphized software as greedy. Greed gorging on tech that resembles fast food has not gotten us where we, Marc, and Peter Thiel (“We wanted flying cars but instead we got 140 characters.”) want to go. The time now is for software that is healthy for us. This is what blockchains and Web3 represent and VitaDAO will do its part.
Author: Tim Peterson, VitaDAO Longevity Working Group Steward
Illustration: Tim Peterson and Si Maclennan