
A Bad Idea from Congress About How to Fund Science - xg15
http://www.forbes.com/sites/stevensalzberg/2015/07/27/heres-a-colossally-bad-idea-from-congress-about-how-to-fund-science/
======
justin66
One flaw comes to mind when the thought of using prizes to fund pure science
is discussed. It's actually an issue that is even larger than prizes.

The people who go down the wrong path in science are often performing an
important service. It is obvious enough that we cannot know beforehand how to
solve all of science's hard problems (they wouldn't be hard problems...) and
of course the people who don't succeed still need to be paid.

The other, maybe less immediately obvious thing, is that a person or group who
demonstrates the ways a previously plausible line of thought just doesn't work
is performing a valuable service. Progress in science depends on what they
publish, even if their work ends up being a dead end.

~~~
rm_-rf_slash
My father researched semiconductors at Cornell his entire career. One time he
told me of a way he and his colleagues envisioned producing semiconductors
that would have radically shrunk the cost of solar panels. After months of
research, they found that the physical realities simply did not permit the
hypothesis to function.

Dead end.

In the eyes of Congress, this whole affair was a waste of money, but for every
scientist with the same idea, it means one less path to waste time and money
on.

~~~
apo
If the negative results weren't published, then it was a waste of money.
Sadly, this happens all the time.

Incentives in science publishing generally work against the publication of
negative results. The publication-based economy lies at the heart of most of
what's wrong with science today.

It's not clear to what extent prize-based funding could change this culture.
I'm not sure I agree with the size of the initial trial, but I do support
experimenting with new models of government funding for science research.

~~~
rm_-rf_slash
The results were published. Dad was disappointed that it didn't work but he
was content to know that he saved someone else from trying the same.

~~~
dwc
More than that, I'm guessing that it also shone some light on those physical
realities and therefore advanced the field in general. Maybe not in a big way,
but much of science, technology and manufacturing is build of many small
advances.

------
gooseus
Here is the offending section of the bill in question:

[https://www.congress.gov/bill/114th-congress/house-
bill/6/te...](https://www.congress.gov/bill/114th-congress/house-
bill/6/text#toc-H6E3C311E24F947609A106A90B3A42696)

Apparently a panel of 9 persons will be in charge of giving away $80 million
in prize money for biomedical advancements every year to any person or company
(even foreign).

The 9 people are primarily congressional appointments and the director of NIH
(who is already appointed) and the administration of this program can be
outsourced to a private company who can take 15% of the money.

Personally, I'd have to agree with the author that this is a pretty stupid
idea.

------
astazangasta
This is not a colossally bad idea, it is a colossally good one (though maybe
not as suggested), and perhaps the best way to end the stupid patent circus
that is ruining biomedical research.

We need not replace grants this way, of course - but we can supplement,
because grants, as we all know, can't even begin to cover the cost of clinical
trials, for the most part. This means that only large pharma companies can
foot the bill, here. Then they walk off with a patent and collect monopoly
rents from the American public to the tune of $300 billion a year, in excess
of the market cost of drug production.

If, on the other hand, we can offer a large prize that covers the costs of
development after the fact, then we get the goods - development already works
this way, the "prize" is simply in the form of a drug company buying you out
for your IP.

In the alternative, the US government "buys you out" for several tens of
millions. The drug, instead of being patented, goes into the public domain.
The developers walk off with tons of money. The public saves hundreds of
billions of dollars. Income inequality lessens.

~~~
Thriptic
80 million dollars wouldn't even begin to cover the development / trial costs
of a single drug, let alone many. Many drugs also fail late in the clinical
trial process (phase 2+), meaning that 80 million dollars would just disappear
upon failure. I highly doubt the government has the stomach to eat those
losses.

~~~
astazangasta
Why not? The government can easily, easily pick up the tab for clinical
trials, which amount to pennies compared to the amount it is shelling out in
prescription drug costs via Medicare. It already does, to a great extent, and
it's so heavily involved in the process it seems natural to make them eat the
costs.

~~~
Thriptic
> It already does, to a great extent, and it's so heavily involved in the
> process it seems natural to make them eat the costs

As far as I know, the government has minimal involvement / skin in the private
development process as it stands currently, and only steps in to perform
regulatory oversight and helps define trial design for regulatory approval.
Almost all costs are borne by the private sector and all work is done by the
private sector.

~~~
VLM
"Almost all costs are borne by the private sector"

Doesn't every penny of "old people drugs" development come from selling drugs
to old people paid solely by medicare? I'm just saying if you trace back where
those supposed private sector $$ come from, don't almost 100% of them come
from the Medicare program?

On the good side you'd cut out a lot of middlemen. No point paying them off
thru multiple steps for doing basically nothing productive.

On the bad side you'd cut out a lot of middlemen. Their corporate owners
finance a lot of re-election campaigns and PACs....

~~~
Thriptic
> Doesn't every penny of "old people drugs" development come from selling
> drugs to old people paid solely by medicare?

I'm not sure what this statement means. Drug development costs are accrued by
the company before the drug goes to market. Costs are borne by the company's
investors or offset using profits from previous ventures. Some of these
profits may be from drugs meant for the elderly or they may not.

> I'm just saying if you trace back where those supposed private sector $$
> come from, don't almost 100% of them come from the Medicare program?

No, much of the initial development capital comes from investors or from other
profits which are from many sources. If you're talking about who is paying for
the drug, then you're completely forgetting about private insurance companies,
which spend at least as much each year on health care costs as medicare.
You're also forgetting about the entire ex-US market.

> On the good side you'd cut out a lot of middlemen. No point paying them off
> thru multiple steps for doing basically nothing productive.

Government is not synonymous with efficiency, especially when there is no
profit motive involved.

~~~
astazangasta
Government is often quite efficient. For example, public health insurance has
smaller overhead (like five fold less) than equivalent private products. In
terms of R&D there is no contest. The entire NIH budget produces prodigious
amounts of research, from the basic to the translational, for less than what
the entire pharma industry spends just to refine their drug development. The
private sector sucks at research spending.

~~~
Thriptic
> Government is often quite efficient. For example, public health insurance
> has smaller overhead (like five fold less) than equivalent private products.

I don't have the numbers so I can't speak to the overhead, but I can point at
the VA health care system as a counter to your statements about government
health care being efficient.

> The entire NIH budget produces prodigious amounts of research, from the
> basic to the translational, for less than what the entire pharma industry
> spends just to refine their drug development. The private sector sucks at
> research spending.

There are a number of problems with this argument.

First, the NIH can afford to take a shotgun approach to research funding which
pharma can't take because the risks of loss are so much lower. The NIH can
give out large numbers of grants per year, have a large number of them fail to
produce meaningful results, and call their work a success as long as some good
work is being done. That model is untenable at the major clinical trial level
because the losses would be astronomical. It's the same reason why the Y
combinator investment strategy wouldn't work if you wanted to apply it to big
private equity deals: You can't fail massively more than a few times before
you're in trouble.

Second, the standards for "success" are completely different for drug
development and basic / translational research. Most basic research is looking
for (at best) proof of concept in an in vitro or in silico model; most
translational research is looking for efficacy in an animal model using small
populations. A pharma research project has to consider statistically
significant efficacy, formulation, dosing, acute and chronic direct toxicity,
delivery, off target effects, drug-drug interactions, manufacturing, storage,
population differences etc and are held to much higher standards at every
stage than your average research lab. By the way, even with these differences
in requirements, it is well known that a lot of published, NIH funded research
coming out of academia is not reproducible:
[http://www.nature.com/nrd/journal/v10/n9/full/nrd3439-c1.htm...](http://www.nature.com/nrd/journal/v10/n9/full/nrd3439-c1.html),
[http://www.nature.com/news/announcement-reducing-our-
irrepro...](http://www.nature.com/news/announcement-reducing-our-
irreproducibility-1.12852) If this were to happen in pharma, you would have
deaths and lawsuits.

~~~
astazangasta
This happens all the time with pharma. See SSRIs, drugs that have no theory
behind them, tiny effect sizes barely better than placebo, terrible side
effects and withdrawal symptoms. They make billions for decades; they are
still widely prescribed. What pharma can't do with science, they paper over
with marketing.

------
leoc
The "colossally bad", "stupid" rhetoric would be justified if the proposal
were for the NIH to give away a significant proportion of its budget in
prizes: it's reasonably obvious that prizes can't be a mainstay of public
research funding. Instead, the proposal is to spend $80 million: about 0.25%
of the NSF's present budget, and less than a quarter of the proposed increase
in annual NSF funding in the bill. In other words, throw this $80 million into
the NSF's general expenditure instead and in future it would be about to fund,
oh, maybe about 20.05% of business-as-usual funding requests to pursue
tendentious environmental-health correlation findings and non-reproducible
treatments for cancer in inbred mice. (Until the supply of these inevitably
rose to meet its former "equilibrium" with demand.) If that's the opportunity
cost of seeing if prizes can stimulate some successful research which will not
otherwise be funded, then it seems like an arguable proposition, especially
since prizes like the X-Prize are often claimed to stimulate research spending
which is a multiple of the actual prize money awarded. (No doubt that effect
would go away if the NSF spent $8 billion in funding through prizes, but
nothing like that is being proposed.)

No doubt the decision process of awarding the prize would be dysfunctional;
but it would be dysfunctional in a _different_ way to the NSF's usual funding
mechanisms, increasing the chance that at least one of the two would produce
the right outcome in any given case.

------
zackmorris
The first thing that came to mind was Beezid. Basically we'll end up with
countless teams of researchers attempting to solve problems and only a tiny
fraction of them being paid for their time.

I agree with the article and propose that we should be doing the exact
opposite - finding a way to fund more garage tinkerers. Just add up the risk
of failure in tech (at least 90%), the fact that so much of our daily workday
is broken up into frivolous minutia, and that researchers spend on the order
of half their time fundraising. It should be obvious that the problem is
underemployment, and that the way to remedy that is to go from top-down to
bottom-up organizational structures. In other words, recognize the dignity of
work and not just the financial outcome.

------
dnautics
It's a staggeringly bad idea but for none of the reasons put forth in the
article (jingoism? Really?). The big reason is fraud. The culture of fraud is
overly endemic in the grant-based system _as it is_ and it's not clear that
gaming a system of contests is not going to be the dominant mode of
prizewinning.

------
cantankerous
It seems to me that the prize model really could work in areas where there's a
lot of value snagged up in existing knowledge we already have and the prize-
givers want to shake out that value in the form of good applications. I think
this works for DARPA because DARPA these days seems to want deliverables that
are in this vein. The prize model can also work well in a situation where the
prize-giver wants the results to enter the public domain or be cheaply
available to the public.

I don't think this could work to fund blue sky research, though. It's asking
for too much risk to be assumed by a researcher who probably doesn't have the
resources to justify these kinds of attempts.

------
AUmrysh
This sounds like a lot of FUD. $80 million isn't that much compared to the NIH
budget. This is about one third of one percent of all NIH funding we're
talking about.

I don't think we should change the funding system from grants to prizes. The
existence of my job relies almost entirely on NIH funded grants, and I am not
worried about this in the least. When they start talking about replacing the
other $23.9+ billion in NIH grants with prizes, then we should worry.

------
cossatot
Why not consider this an _experiment_ in funding efficiency? This should be
supported by scientists across the board, especially as it's such a tiny
fraction of the NIH budget. It's a bit much to claim to fully know the outcome
of such an experiment before doing it.

This being said, my priors are that it's a better funding model for
engineering than for science. Engineering is more goal-oriented, whereas
science is more exploratory. In science, it's not always a good idea to have a
strongly desired outcome, because of problems associated with confirmation
bias, or from spending too much time in the wrong rabbit hole. Apart from
concerns about gaming the system (which are valid), the wrong phrasing of the
goal could make it impossible to reach, or otherwise direct people in the
wrong way. And it's not always clear that the understanding of some process or
phenomenon will ever be done to some satisfaction; sometimes you get there and
it's much more convoluted than anyone had previously assumed.

The economist Tim Harford discusses the merits of this funding model quite a
bit in _Adapt_ , and is quite supportive of it, as are other economists such
as Alex Tabarrok. But it's really not clear that they understand the
differences between engineering and science, either. Most of the DARPA/X-prize
research, which are the typical examples of this funding model working
effectively, are engineering research rather than science qua science, or the
exploration of natural phenomena.

But given the NIH's aims (which are more practical than NSF's) and the
recognition that blue-sky research needs to be funded differently, it might
just be a great complement to the existing funding model. I would love to have
a bit more of it for those of my own projects that are geared more towards
tool/methods development than immediate phenomena understanding; I work on
them in my spare time or in conjunction with scientific studies, and it'd be
great if I could occasionally pay myself back for that time upon successful
completion.

------
sweezyjeezy
> These 9 people will be responsible for giving away $80 million per year in
> prizes. In the scientific world, that’s a huge program.

It's about 0.25% of the NIH's investment budget. Doesn't sound like that big a
deal to me.

------
mlinksva
Knowledge Ecology International are the experts on innovation prizes, lots of
background on [http://keionline.org/prizes](http://keionline.org/prizes)

I haven't noticed any commentary at
[https://twitter.com/jamie_love](https://twitter.com/jamie_love) (their
director) or
[http://www.keionline.org/tracker](http://www.keionline.org/tracker) on this
bill yet, am I missing something?

~~~
mlinksva
Here's someone knowledgeable [https://medium.com/@bethnoveck/funding-science-
with-prizes-i...](https://medium.com/@bethnoveck/funding-science-with-prizes-
is-a-great-idea-asking-congressmen-to-judge-those-prizes-is-not-fb8b9af7f4cf)

------
jnordwick
So are the prized determined in retrospect? That seems like a very odd way to
encourage direction. It would make a lot more sense if bounties were published
ahead of time.

~~~
leoc
It doesn't seem so: apparently (
[https://news.ycombinator.com/item?id=9955286](https://news.ycombinator.com/item?id=9955286)
) this is the text [https://www.congress.gov/bill/114th-congress/house-
bill/6/te...](https://www.congress.gov/bill/114th-congress/house-
bill/6/text#toc-H6E3C311E24F947609A106A90B3A42696) , and it seems to be
setting up something more like the X-Prizes, with at least the objectives
(maybe not all the awards) spelled out in advance, than the Nobel Prize which
is awarded retrospectively (and to the individuals who did the work, rather
than to the project itself). I assume that TFA's comparison to the Nobels is
just inaccurate.

------
joshuaheard
Counterpoint:

[http://www.darpa.mil/work-with-us/public/prizes](http://www.darpa.mil/work-
with-us/public/prizes)

I think it could work in certain circumstances for NIH. It's been successful
for DARPA, so it's worth a try.

~~~
stevensalzberg
Why do people think that this has been successful for DARPA? DARPA has spent
billions on all kinds of ideas that don't work, including prize competitions.
Once in a while they have a "hit" and they publicize that like crazy. DARPA is
also known (notoriously, one could say) for operating a good-old-boys system,
where you have to butter up the DARPA program managers to get any funding. So
no, I don't agree that prizes have been successful for DARPA.

~~~
michaelkeenan
> Why do people think that this has been successful for DARPA? DARPA has spent
> billions on all kinds of ideas that don't work, including prize
> competitions.

Some people regard the DARPA prizes as successful because, in some cases, the
technology to win the prize was developed.

> DARPA is also known (notoriously, one could say) for operating a good-old-
> boys system, where you have to butter up the DARPA program managers to get
> any funding.

Can you explain this a bit more in the context of the prize program? It looks
like a criticism of their grant program, but you follow it with:

> So no, I don't agree that prizes have been successful for DARPA.

------
michaelkeenan
> This is a staggeringly bad idea. Why? Where do I begin? Well, first of all,
> biomedical research costs money–lots of money. Everyone I know in biomedical
> research, in which I’ve been working for 25 years, needs money before they
> make their discoveries. A prize at the end is nice, but you can’t do
> anything if you can’t pay for equipment, supplies, and (perhaps Congress
> will be surprised to learn this) people’s salaries.

This point would be more powerful if he explained it in the context of the
DARPA and XPRIZE competitions. Spaceships are surely expensive, but multiple
teams were funded. Is there a reason that won't happen for the NIH prizes?

> NIH will give these prizes to foreign citizens–and companies! So apparently
> they will take some portion of NIH’s budget, and instead of awarding it in
> grants to U.S. scientists, they will give prizes to companies in, say,
> Russia. Don’t get me wrong: I think science should be supported in every
> country around the world. But each country has its own system, and the NIH
> is by far the most important source of funding for biomedical science in the
> U.S. We just can’t afford to have NIH give out prizes to the entire world.

I don't think it follows that because each country has its own science system,
then the US can't afford to give prizes to the entire world. The prizes won't
be higher if they're given to international teams; they just might be awarded
earlier. Surely it would be _more_ expensive (at least in time) to restrict it
by country, because someone else might be able to make the advance faster than
the US.

It appears that the author isn't motivated by advancing science, but by
funding American scientists. If American scientists need or deserve more
money, that should be addressed separately from how to advance scientific
progress most quickly. There are probably ways to accomplish giving Americans
more money that don't slow down scientific progress.

