Prediction markets for assessing clinical probabilities of success

• US 20070250429A1
• Filed: 04/19/2006
• Published: 10/25/2007
• Est. Priority Date: 04/19/2006
• Status: Abandoned Application

• Current Assignee: Clinical Futures LLC
• Original Assignee: Clinical Futures LLC
• Inventors: Walser, Bryan, Elia, Marc
• Application Number:
  US11/407,465
• Publication Number:
  US 20070250429A1
• Time in Patent Office: Days
• US Class Current: 705/37
• CPC Class Codes: G06Q 10/00 Administration; Management
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange

Abstract

Prediction markets are used to determine the probability of an experimental therapeutic, diagnostic, or prophylactic candidate meeting clinical trial and post-trial goals, such as clinical trial endpoints and timelines. The prediction market processes buy and sell orders from market participants, while adjusting the prices of the securities according to the orders. The securities have specific meanings which correspond to goals in clinical trials or other outcomes in clinical candidate development. The price of a security determined by the market corresponds to the probability of the corresponding goal or outcome. The participants are selected for their expert knowledge of specific factors related to candidate development. Using appropriately selected securities and participants, the prediction market may be used to generate probabilities of success useful for long-range planning and valuation, determining production timelines and volumes, management of candidates in a development portfolio, and clinical management of patients by physicians.

Claims

1. A method of using a prediction market to determine a probability of a candidate meeting clinical trial goals, the method comprising:

identifying a specific goal for the candidate, wherein the goal is associated with a specific indication and a specific trial protocol;

structuring a security to be traded by qualified market participants as a proxy for the candidate reaching the specific goal;

selecting a qualified group of participants to trade the security, wherein the participants in the group have relevant knowledge;

establishing a prediction market for the selected group of participants to trade the security for the specific goal with sufficient liquidity to generate a robust market clearing price;

observing trading behaviors in the prediction market; and

determining the probability from the observed trading behaviors.

2. The method of claim 1, wherein the candidate comprises an experimental drug therapeutic, a diagnostic, a prophylactic, or a combination thereof.

3. The method of claim 1, wherein the candidate comprises a small molecule, a monoclonal antibody, or a protein therapeutic.

4. The method of claim 1, wherein selection of the participants is based upon relevance of knowledge of the participants to producing an accurate probability determination.

5. The method of claim 4, wherein the participants are knowledgeable in clinical application and clinical development of candidates for at least one therapeutic area under examination.

6. The method of claim 4, wherein the participants are knowledgeable about a biological feature modulated by the candidate under examination.

7. The method of claim 6, wherein the biological feature is a biological target, a pathway, a cell type, an organ system, or a combination thereof.

8. The method of claim 4, wherein the participants are knowledgeable about development and manufacture of the type of candidate under examination.

9. The method of claim 4, wherein the participants are knowledgeable about the actions of at least one relevant administrative organization.

10. The method of claim 9, wherein the organization comprises a regulatory body, an advisory committee, or a combination thereof.

11. The method of claim 10, wherein the organization comprises the United Status Food and Drug Administration.

12. The method of claim 1, wherein establishing the prediction market for the selected group of participants to trade the security for the specific goal with sufficient liquidity to generate a robust market clearing price comprises the step of:

adding a market maker to the market, wherein the market maker holds a percentage of the securities as held back securities, sells the held back securities to the participants, and buys securities to maintain the percentage of held securities.

13. The method of claim 1, wherein the goal is a clinical trial endpoint.

14. The method of claim 1, wherein the step of structuring a security comprises defining the security to reflect a candidate'"'"'s probability of success.

15. The method of claim 1, wherein the step of structuring a security comprises defining the security to reflect a variable related to the candidate'"'"'s probability of success.

16. The method of claim 15, wherein success comprises clinical success, commercial success, or a combination thereof.

17. The method of claim 1, wherein the step of structuring a security comprises choosing the security to reflect a likely distribution for a particular variable related to the candidate'"'"'s probability of achieving at least one endpoint.

18. The method of claim 17, wherein the at least one endpoint is linked to clinical success, commercial success, or a combination thereof.

19. The method of claim 1, wherein observing trading behaviors comprises observing the equilibrium price of the security.

20. The method of claim 1, wherein observing trading behaviors comprises observing pricing trends for the security.

21. The method of claim 1, wherein observing trading behaviors comprises observing distribution of prices for the security.

22. The method of claim 1, wherein observing trading behaviors comprises observing volume, observing timing, and observing prices for individual bids, asks, and trades for the security.

23. A computer program product comprising program code for using a prediction market to determine a probability of a candidate meeting clinical trials goals, the computer program product comprising:

program code operable to associate a price with a security, wherein the security is further associated with a specific goal for the candidate, wherein the specific goal is associated with a specific indication and a specific trial protocol, and wherein the security is traded as a proxy for the candidate reaching the specific goal;

program code operable to make the security available in an online market for buying and selling by participants from a qualified group of participants, wherein the participants in the qualified group have relevant knowledge;

program code operable to accept and process buy and sell orders for the security from the participants; and

program code operable to adjust the price based upon the buy and sell orders to reflect the market'"'"'s determination of the price.

24. The computer program product of claim 23, the computer program product further comprising:

program code operable to maintain a market maker, wherein the market maker buys and sells the securities to maintain an inventory, wherein the inventory comprises a percentage of the total number of securities in the market.

25. The computer program product of claim 24, wherein the percentage is ten percent.

26. The computer program product of claim 23, wherein the goal is a clinical trial endpoint.

27. The computer program product of claim 23, the computer program product further comprising:

program code operable to restrict access to the market to members of the group.

28. A method of using a prediction market to determine a probability of a candidate meeting clinical trial goals, comprising the steps of:

associating a price with a security, wherein the security is further associated with a specific goal for the candidate, wherein the specific goal is associated with a specific indication and a specific trial protocol, and wherein the security is traded as a proxy for the candidate reaching the specific goal;

making the security available in an online market for buying and selling by participants;

accepting and processing buy and sell orders for the security from the participants from a qualified group of participants, wherein the participants in the qualified group have relevant knowledge; and

adjusting the price based upon the buy and sell orders to reflect the market'"'"'s determination of the price.

29. The method of claim 28, further comprising the steps of:

maintaining a market maker, wherein the market maker buys and sells the securities to maintain an inventory, wherein the inventory comprises a percentage of the total number of securities in the market.

30. The method of claim 29, wherein the percentage is ten percent.

31. The method of claim 28, wherein the goal is a clinical trial endpoint.

32. The method of claim 28, further comprising the step of:

restricting access to the market to members of the group.