Patrick Malone, MD PhD

physician-scientist turned biotech investor @KdT_Ventures | helping founders build science and tech-driven companies | writing at

[Patrick Malone, MD PhD @patricksmalone]

on biotech platform strategy

in a new essay, @ElliotHershberg and I riff on biotech platform typology and partnering dynamics. we unpack why many biotechs pivot from external partnerships to internal programs, and why that trend might change in the near future.

we start with a framework from biotech veteran Steven Holtzman for categorizing biotechs into product and platform companies, and the differences between therapeutic modality platforms and disease insight platforms.

the business strategy pursued by each biotech ultimately comes down to the details of the underlying technology, but historically, a vertical focus on internally developed drugs has been the most successful value creation strategy in all of biotech.

building a services platform, which exclusively pursues external partnerships with no internal pipeline, is really, really hard. the list of companies that have done this successfully is short, and many end up shifting strategy to developing their own wholly owned assets.

a partnership-only business model in biotech has been difficult to scale successfully, but will this trend continue? to address this question, we analyzed data from biopharma partnerships over the last ~15 years.

if platform technologies are becoming more proven and validated, average partnership deal value should increase over time. if average deal value continues to increase, at some point it will be feasible (and even preferable) to pursue a services/partnerships-only model as a platform biotech.

we found a trend towards increasing average total deal value, average milestone payments, and total number of partnerships over time, effectively increasing the total addressable market for services platforms.

there are some important caveats and confounds with these data, but qualitatively, these trends suggest that there may be a shift in pricing power from partners to technology platform developers. if this trend continues, external partnerships as a mechanism of value capture will improve relative to wholly owned internal programs, thus improving the scalability and success-rate of services platforms in biotech.

this was a fun one to write. the full piece is packed full of perspective and conjecture worth disagreeing with, so reach out if you want to discuss!

[Jasmin Kaur @JasminKaur_]

been thinking about this one a lot recently as the bar for discovery keeps getting lower with better AI-Bio models and closed loop systems

[Patrick Malone, MD PhD @patricksmalone]

the next chapter of Decoding Bio! excited to give this passion project the resources this community deserves.

[Mo Islam @itsmoislam]

BIG NEWS: I'm thrilled to announce that Arkaea Media Group has acquired Decoding Bio, one of the leading media brands in biotechnology. This is our first acquisition and a continuation of our thesis to build media for the most consequential industries in the world.

Decoding Bio was founded by @ameekapadia, @pablolubroth, @KetanYerneni, @patricksmalone, and @morgancheatham and built into the definitive voice covering the intersection of AI and biology.

The opportunity in biotech media is concentrated in one place: the intersection of AI and biology. This is where the future of the industry is being built. AI is rewriting how drugs get discovered, how trials get designed, how proteins get engineered. Frontier AI labs are racing into pharma. Pharma is responding with nine and ten-figure commitments. A new generation of companies is being built by founders who grew up on both sides, and they're moving faster than the legacy industry can absorb.

The media covering this shift is broken. Legacy biotech publications miss the AI story. Tech publications don't take biology seriously. The intersection between them is where critical work is happening. Decoding Bio is the only brand covering it with real credibility.

To Amee, Pablo, Ketan, Patrick, and Morgan: thank you for building such an incredible brand and for choosing to build the next chapter with us.

The best is ahead.

[Patrick Malone, MD PhD @patricksmalone]

@VishalGulati_ haha it's a good point actually, obvious public perception pharma is tied up in a whole bunch of stuff beyond treating disease (eg pricing, misplaced anger that should be directed to other parts of the stack eg PBMs, etc), but good point nonetheless.

[Patrick Malone, MD PhD @patricksmalone]

one interpretation of the push by OAI and Anthropic into biotech: drug discovery is a uniquely legible, emotionally irrefutable test of AI.

as public backlash builds around the cost and footprint of AI (data centers, energy), few proofs of value are clearer than curing disease

[Patrick Malone, MD PhD @patricksmalone]

@thisisnotmark_ this isn’t really a core competency of OAI, Anthropic, or even most pharma. and since pharma already outsources a lot of early R&D, I don’t see why data gen would be any different.

[Niklas Anzinger 📍 Infinita @NiklasAnzinger]

This is making the rounds, and it's great - but we need to go much further to stay competitive with China:

They key is to let states do it, the FDA just needs to create acceptance for state-led programs.

- New Hampshire's HB1734 creates the option for private/non-profit/independent scientific review boards (like IRBs) to apply regulatory frameworks for phase-1s or equivalent (like Australia CTN). Federal rules would prohibit actual phase-1/INDs to be conducted this way, but if the FDA just issues guidance to accept such trials this would unleash state innovation. Everyone wins: the FDA already accepts Australia's trials, and this way those can just be brought into the US territory. By doing it through states, no federal law needs change.

- Montana's SB 535 and New Hampshire HB 1734 allow for post-phase-1 "right-to-try 2.0" access. The key is that they're a) very broad, any patient qualifies instead of required proof they die in 6 months, and b) the provider has better monetization options. Again, we're already doing that: a) off-label drugs have just passed a phase-1 but not proven efficacy, b) right-to-try is federal policy and the moral case for patients is obvious.

This creates a whole alternative pathway post-phase-1 that gives biotechs many more options to innovate. Montana & New Hampshire are creating oversight mechanisms that ensure safety but are administered more efficiently through scientific review boards (which again have oversight by state health departments, i.e. if there are bad actors their licenses can be revoked).

Again, everyone wins: through these official state pathways there is less grey market for stem cell clinics and these programs could collect outcome data that improves official INDs for approval by the FDA.

These state frameworks, including also e.g. Utah, Florida, Texas are genuinely innovative.

@FDA @DrMakaryFDA need to create recognition for state frameworks, so there is clarity about federal-state legal conflicts - otherwise these programs will attract grey markets (larger, credible players need clarity). This is much simpler than federal-level changes, and unleashes decentralized regulatory innovation.

@sytses @RuxandraTeslo @cremieuxrecueil @ATabarrok @dr4liberty @zachweinberg @patricksmalone @GraniteBio

[Patrick Malone, MD PhD @patricksmalone]

early stage clinical develop, ph1b/2 to go from preclinical asset/idea to clinical PoC in humans as quickly and as capital efficiently as possible. this is in part a regulatory question, but not only. china has real structural advantages here: clinical trials are dramatically cheaper to run, standard-of-care requirements are less stringent (meaning cleaner trial designs and faster enrollment), patient populations are large, etc

[Patrick Malone, MD PhD @patricksmalone]

the NIH budget is not enough

there’s a persistent narrative in the US that the global dominance of our biomedical ecosystem is tightly coupled to the NIH budget. if it grows, we’re secure. if it stagnates or declines, we risk ceding leadership to countries like China.

this framing is intuitive, but incomplete, and potentially counterproductive.

it assumes that scientific leadership is primarily a function of funding basic research, but history suggests otherwise. the photovoltaic cell was invented at Bell Labs, yet china dominates global solar manufacturing. the foundational chemistry for lithium-ion batteries was developed by American scientists, but china accounts for the majority of global production capacity. American scientists won the Nobel prize; china won the industry.

discovery is necessary, but clearly not sufficient. an ecosystem’s strength is not defined solely by its ability to generate new knowledge, but by its ability to translate that knowledge into real-world validation, products, companies, and scaled industries. despite relatively modest contributions (historically) to fundamental research, china has leveraged process knowledge — the capacity to scale up whole new industries — to outcompete the US in a bunch of strategic technologies.

the NIH is genuinely extraordinary. it is arguably the greatest engine of basic biomedical research in human history. defending its budget is not wrong. but the biotech competitive landscape is not won at the bench, but rather at the intersection of discovery and deployment: clinical development, manufacturing scale-up, regulatory strategy, and the commercial ecosystems that allow validated science to become accessible therapies. China clearly understands this.

the current debate treats upstream investment as if it automatically confers downstream advantage. it doesn't. the most important question for our industry is whether we're building the translational infrastructure and regulatory agility to ensure that when american scientists make the next breakthrough, our patients and our industry are the ones who benefit.

[Patrick Malone, MD PhD @patricksmalone]

@CEOCorbus what is incorrect about this? this is happening / has happened, and an entire wave of China-to-global licensing deals over the past several years has been predicated on exactly this regulatory pathway

[Patrick Malone, MD PhD @patricksmalone]

revealed preference about what this admin cares about: 13 PCAST appointees representing AI/semis, energy, and quantum, but zero from biotech.

frustrating that biotech isn't (yet) being treated as a first-order strategic technology in the same way adjacent fields are.

there are still unfilled seats on PCAST, so this can be fixed. but filling the seat with a token biotech person won't be enough. PCAST's EO authorizes the creation of subcommittees. a single biotech appointee, however talented, will be constrained.

the better play is to push for a biotech subcommittee within PCAST, one that can bring in outside domain experts, issue formal reports, and create an institutional momentum for biotech policy.

this is how the semiconductor industry operated within prior PCATs. the semi industry spent years reframing chips as national security infra, when it was time for PCAST to weigh in on the CHIPS Act, the domain expertise was already embedded in the advisory apparatus. biotech has no equivalent.

[White House OSTP 47 @WHOSTP47]

https://t.co/G7Id0q27RU

[Tweets from Zach Weinberg @zachweinberg]

Would be nice to add a biotech person! Just saying ☺️.

[Patrick Malone, MD PhD @patricksmalone]

@zachweinberg yea I like that use case. but still see reproducibility as less about methodological errors and more about incentives and things not captured in the paper eg selective reporting, random artifacts, genuine signals that don’t generalize, etc

[Patrick Malone, MD PhD @patricksmalone]

i’ve been reflecting on how much my own behavior has shifted from reading scientific papers to asking AI to interpret the literature.

as LLMs get better, more of our interaction with knowledge is mediated through generated summaries rather than primary sources. that shift is not just about how we consume information. it undermines the economic layer that has historically funded truth generation, across both journalism and science.

in news, if LLMs can produce infinite “journalism-like” articles, the marginal value of content collapses. subscriptions erode, ads weaken. when anyone can generate something that looks like reporting, the institutions that fund actual reporting, including investigation, sourcing, and verification, start to break. the traditional business model was already cracking, and AI may collapse it entirely.

in science, the same dynamic plays out. if LLMs can generate “paper-like” PDFs, the supply of plausible research explodes and signal is lost in the noise. journals and citations, already imperfect proxies for truth, become even less reliable. when publishing is cheap, it stops being a meaningful filter for correctness. the incentive shifts toward producing more papers, not more correct ones.

the core issue is that our systems reward the production of content, not the generation of truth. journalists get paid to publish, not to be right. researchers are rewarded for output, filtered through peer review systems with no skin in the game. reviewers do not profit from identifying important work or lose from endorsing weak work.

prediction markets offer a different architecture, one that shifts incentives from output to accuracy.

instead of rewarding publication, markets reward correct forecasts. if you uncover a scoop, generate a dataset, or replicate a result, you can monetize that knowledge directly by taking a position in a market tied to the truth, then revealing the information.

this changes the unit of value. it is no longer a paper or article, but a resolved question, such as whether a clinical trial succeeds or a result replicates. anyone who can answer these questions early, including journalists, researchers, labs, and AI agents, has an incentive to do the hard work of discovery and verification.

this is particularly powerful for science. today, novelty is rewarded over correctness. replication is undervalued, and null results never get published. in a market system, the incentives flip such that shorting a flashy result or replicating an overlooked finding are profitable.

the broader shift is that journals, news outlets, and preprint servers become oracles feeding into markets, rather than the primary locus of value capture. the economic reward flows to whoever is most accurate about reality before it is obvious.

AI makes content cheap, which makes correctness more valuable. prediction markets may be one of the first mechanisms that directly reward it.

[Elliot Hershberg @ElliotHershberg]

Going Founder Mode On Cancer

https://t.co/vAqXIV5zvE

Sid Sijbrandij is a generational founder. He founded and led GitLab, one of the largest remote companies in the world, from idea-stage startup to NASDAQ-listed software giant.

But in 2022, a six centimeter mass growing from his upper spine threatened to end all of that. He had cancer.

What happened next is nothing short of remarkable. Sid went founder mode on his care journey. In the years since, he's deployed cutting-edge genomics to profile his disease. Based on this data, he's developed a growing armamentarium of personalized therapies.

As a result, his disease is now undetectable.

A simplistic version of this story could be, “Wow! A brilliant billionaire seemingly cured his cancer. Good for him!”

But as I’ve gotten to know Sid, it’s become abundantly clear to me that there is more to the story than that.

In an in-depth profile for The Century of Biology, I explore Sid's journey and what this might mean for the future of cancer care.

[Patrick Malone, MD PhD @patricksmalone]

https://t.co/qduy40ugdy

[Patrick Malone, MD PhD @patricksmalone]

one observation helps explain why so much of the public distrusts the biopharma industry: drugs are generating *more* revenue while treating *fewer* patients than ever before.

in 2010, the top drug in the US, Lipitor, generated ~$7 billion in revenue while reaching tens of millions of patients. by 2020, the top drug, Humira, more than doubled that revenue to ~$16 billion, but the number of patients treated collapsed to ~300,000.

a combination of science, regulation, and economics pushed the industry to focus on smaller patient populations, shifting away from mass-market medicines (e.g. statins, antidepressants) toward specialty drugs like gene therapies for rare diseases. these breakthroughs have delivered transformative benefits to patients who previously had no options, but they also feed a social return gap (rising revenues paired with shrinking reach), and widen the distance between how our industry defines success and how the public experiences it.

we often define success in our industry based on the depth of impact for patients, but it is important to remember that the public also judges us by aggregate reach. both perspectives are valid, but they often clash. restoring public trust in our industry will require recommitting to medicines that reach large populations and improve everyday health at scale.

GLP-1 drugs for obesity and diabetes point to a path forward. they generate blockbuster revenues while reaching tens of millions of patients and delivering meaningful, population-level health benefits. rebuilding public trust will require replicating this model and demonstrating that biopharma can deliver both blockbuster economics and population-level health gains.

[Patrick Malone, MD PhD @patricksmalone]

@LifeSciVC @eperlste @ronalfa @PearlF @PeterKolchinsky based

[Patrick Malone, MD PhD @patricksmalone]

biotech needs its own david sacks

in reflecting on this past year, one thing has become increasingly obvious to me: biotech desperately needs a public champion. someone who can translate scientific progress into policy, coordinate the industry’s scattered voices into a coherent agenda, and frame biotech as a strategic national priority rather than a niche technical field. this is perhaps the biggest structural weakness facing our industry.

watching the policy momentum behind AI and crypto has been frustrating. these sectors have moved quickly not just because the technology is advancing, but because people like david sacks have created a central organizing force. they’ve built a coherent narrative, rallied founders and investors, and focused the tech industry’s efforts in washington. biotech has no equivalent.

what makes this more frustrating is that the rationale driving urgency in AI policy applies almost word-for-word to biotech: competition with china. national security. domestic manufacturing capacity. strategic dependence on foreign supply chains. you could literally replace “AI” or “rare earths” with “biotech” in many of the recent executive orders, and the logic would hold perfectly. these should be obvious, bipartisan reasons to invest in and accelerate the biotech ecosystem. yet the case isn’t being made with the same clarity or force.

part of the problem is a PR failure. most policymakers don’t understand that biotech ≠ pharma. biotech startups are the innovators; pharma is the innovation buyer. but in washington, these groups get conflated. early-stage biotech gets pulled into the same policy debates as multibillion-dollar incumbents, and the result is predictable: the people doing the actual innovation are not represented.

another issue is fragmentation. AI and crypto accelerated because the community acted like a movement. there was a center of gravity pulling together founders, operators, investors, and policymakers. biotech, by contrast, is spread across academic labs, NIH, the FDA, startups, pharma, state governments, and a long tail of investors. large pharma and small biotech don't often have the same priorities and incentives. there is no unifying node that turns these pieces into a coherent whole.

biotech doesn’t just need more innovation; it needs coordination. it needs someone who can articulate why this industry matters, make the geopolitical case, advocate for regulatory clarity, and translate between science and washington. it needs someone who can build a narrative around biotech as a strategic national asset rather than a niche technical field. biotech needs its david sacks: a movement builder, a policy champion, a narrative architect. until someone steps into that role, the industry will continue to produce world-class science while punching far below its weight in culture, policy, and national strategy.

[Patrick Malone, MD PhD @patricksmalone]

@christymaginn That’s part of the point. The aggregate serves an important role; but you also need an individual / face of the movement. Would love to see the list tho!

[Patrick Malone, MD PhD @patricksmalone]

you can ignore politics, until politics decides it can’t ignore you

[DoctorDueDiligence @DueDoctor]

@patricksmalone Hard to find because most biotech CEOs want more sleep / time with family than working on policy

With that being said policy is pertinent for the American edge and something we drastically need to change (aka get out of our own way)

The harsh truth is that $$$ lobbying needed

[Patrick Malone, MD PhD @patricksmalone]

@DueDoctor he is good, but we need a champion for little biotech not just large pharmaceutical companies. little biotech will resonate more with current admin / political zeitgeist