New Blog: Diamyd Update Part 2: JDRF Flexibilty In Funding and Diamyd In More People
joshua levy
Diamyd Update Part 2: JDRF Flexibilty In Funding and Diamyd In More People
My previous blog posting:
https://cureresearch4type1diabetes.blogspot.com/2023/12/diamyd-update.html
described the main line of DIAGNODE clinical trials designed to get Diamyd FDA approval for people in their honeymoon phase. You should read that posting for a lot of background material. In this blog, I'm going to cover two additional clinical trials aimed at expanding the people who can use this treatment and some interesting details about how JDRF is funding this research.
DIAGNODE Expansion Trials
DiaPrecise (Diamyd For At-Risk)
GADinLADA (Diamyd For LADA)
Money: JDRF, but not T1D Fund
Diamyd (the company) has gotten some money from JDRF through their Industry Partnership Program, and that money is contingent on Diamyd (the treatment) meeting certain successful results. For me, this is a very interesting development and warrants some discussion.
In the past JDRF operated like most other medical research charities (and the US government) and gave grants to researchers. The researchers would propose research and if JDRF liked it, they would give the researchers the money to do it. This is the way most non-profits fund most of their research even to this day.
However, in 2016 some people active in JDRF became frustrated by the gap between academic research (funded by grants) and commercial research which, for small companies, was funded by venture capital and for large companies, by corporate capital. So they created The T1D Fund: https://t1dfund.org (especially read the "about" tab).
This fund uses money seeded into it by JDRF and from other sources (mostly wealth investors) to fund commercial medical development work aimed at T1D. It operates as a venture capital firm. It makes investments in companies doing work in the T1D space. As investors they are (generally) part owners of the companies they invest in, and if those companies are successful, they will profit from the success. Those profits will then be rolled into new investments.
A complete description of how venture capital works (and therefore how the T1D Fund works) is well beyond what I can do in a blog post. I can't even (quickly) find a good on-line summary that someone else has written!
So as of 2016, there were two separate funding methods for getting T1D products to market:
- JDRF, traditional grant-based early research focused.
- The T1DFund, venture capital-based and early product development focused.
But now (finally) to the Diamyd point: the funding that Diamyd received is not exactly either of these two funding methods. It is in between. The money is coming from JDRF but has some very business like conditions, as described in the bullet point items below. (These items are taken from a Diamyd press release.)
- Payments from JDRF are earned when Diamyd Medical completes various milestones in the DIAGNODE-3 study, with these milestones spanning the years 2023 - 2027.
- JDRF can also use its global type 1 diabetes network to raise awareness of the study, which may contribute to patient recruitment, and also provide advisement as Diamyd Medical prepares for a potential commercial approval.
- If Diamyd Medical in the future gets Diamyd® commercially approved and the sale of the drug becomes a commercial success, JDRF will receive a limited royalty on the revenue, if within the framework of the partnership agreement.
These are all very business like terms; similar to how one company funds another. I discuss the details more below, but the summary point is that JDRF is expanding the kinds of funding it can give which adds flexibility to all future investments. For me, this is a good thing because you never know which kind of investment will benefit a new line of research the most.
Why is all this important?
Most importantly, it means that JDRF will share in the monetary success of Diamyd, if there is any. This is very different than traditional research grant work, and it addresses a recent frustration. I know some people were frustrated because JDRF has put money into the academic research with led to the development of Teplizumab, but had not gotten any money out when Teplizumab became a commercial product or even when the company was bought out (for $3 billion US dollars!) This is perfectly normal in academic grant making, which is traditionally what medical research non-profits have done, but it can leave a bad taste in a donor's mouth. The Diamyd funding model avoids this.
Also important: Diamyd only gets money when they meet certain milestones. This is not speculative research grant money; this is payment on success, motivational money. It is very common in the world of corporate financing, but I've never before seen it in the world of research grant making.
In another way, I view this as JDRF having more flexibility in funding cures than academic research projects, but not yet self-funding commercial projects.
Press release: https://www.diamyd.com/docs/pressClips.aspx?ClipID=4676370