It’s fair to say that there’s a high level of excitement these days in biopharma (and the associated academic disciplines) due to the tools we have at our disposal. CRISPR and other gene-editing technologies, new looks at RNA, chromatin, and epigenetics, all sorts of unusual modes for altering cells and whole-animal phenotypes – there’s a lot going on, and there are a lot of frontiers that have opened up.
Frontiers are pretty wild places, though, and there are some pretty wild claims. How about editing genes without a double-strand break (as used in CRISPR)? What if it were a sort of super-selective viral vector, the sort of thing that gene-therapy folks have been searched for? That would be pretty interesting, and there’s a company (Homology Medicine) that says that they have just that, or something very close. But as this article at Technology Review shows, not everyone is buying into it. Well, some people are, to the tune of $127 million so far, but there are skeptics who think that the underlying science just doesn’t work.
This is a testable hypothesis, of course. The company will be working very hard to produce convincing results, and if they do, they can expect to see a lot more than $127 million. I’d be a little jumpy about investing at this point, though, because it’s certainly true that a lot of neat stuff doesn’t quite pan out. (The current research boom, looked at from that perspective, is due to a slightly higher-than-normal run of neat stuff actually working).
Homology Medicine, then, probably has enough money to demonstrate that they’re worth more money, which is about right. I would assume that they’re frantically engaged in just that process, trying to figure out what would be the most inarguable results that have the highest chance of being achieved in the shortest period of time without quite using up all the cash. That’s not an easy problem, but there are a lot of worse problems – for example, not being able to generate any of those results. As the article shows, there’s a not-dismissable chance that that could happen, too. But one way or another, we’ll find out. The people who have put up the $127 million will find out before the rest of us, but eventually, everyone who cares will know.
So this, to me, is still normal and acceptable – that’s how science works and how startups work. As you slide along the same scale, though, you find the pitches getting wilder and the investors getting more clueless. There’s a real dividing line between companies who are dealing with intelligent backers who are willing to take risks, and the ones who are actively trying to avoid people who will ask too many questions. In the first category, you have Homology – and most every other successful company in this business, if you trace them back far enough. You also have a huge pile of failures, too, the good ideas that didn’t pan out.
But the second category are the shady stem-cell clinics and the like, a vast range of scammers who promise everything and don’t want to deal with people who know anything about the details. If a company is upfront about what they’re trying to do, has data that they can present about how it’s working, and a clear plan for where to go next, then good luck to them. If it’s on a “trust us!” basis, though, or if the science behind it turns out to be a lot of gibberish, then you’re looking at trouble. You know what company straddled these two domains, ruinously? Theranos.