New Model for Biotech Funding and Drug Discovery
This is a new format of "interview" where Ray Svitla explores how different founders and projects view the concept of network states and apply it in the real world today. Our focus today is on biotech and legal fields. Let's dive in!
Norachem: AI in Drug Discovery
Norachem, a New York startup, is leveraging AI to transform drug discovery. The company's co-founder, Amit Roy, previously headed AI and data science teams but grew frustrated that advanced computational methods did not see wider use in scientific modeling despite their potential. Just before the pandemic, Roy teamed up with biologists and cancer researchers to tackle this challenge.
Norachem now targets a protein implicated in various cancers, aiming to use its technology to produce active molecules that inhibit cancer growth. Traditionally, bio-companies require 2-3 years and $10-20 million to optimize a molecule that constitutes new IP. Norachem has dramatically reduced this timeline to 4-6 months, with less than $500,000 in investment, producing novel structures in the process.
Bringing Trust to Biotech Funding
Norachem's vision to facilitate private investment in molecule discovery, navigating the subsequent research, clinical trials, or IP sale. This model addresses both the financial and regulatory complexities inherent in early-stage drug discovery, where investor risk is high and trust in commercial milestones is crucial.
Utilizing Be.Exchange, Norachem spun out a Special Purpose Legal Entity (SPLE), establishing a clear governance structure for asset management. This innovation allowed investors to audit SPLE activities and legal agreements, fostering trust and demonstrating a commitment to tangible, data-generating experiments.
Be.exchange co-founder Raza Khan, who previously built fintech products that managed over $6 billion in assets, said Norachem's approach could pioneer "a new era of drug discovery." He envisions new governance models eventually allowing community investment into intellectual property for drugs, medical devices or even group ownership of resources like MRI machines.
The Rise of Network States ideas in Healthcare
As promising Norachem molecules advance toward clinical trials, Be.exchange may look to leverage "network state" jurisdictions with unified rules to navigate differing national regulations more efficiently. By creating a virtual business jurisdiction with international recognition, consolidated laws, and legal variations from different countries, entities can operate under a unified legal framework. This model proposes a new standard for business law and procedures, simplifying contract drafting and dispute resolution in a virtual environment.
Kyriakos Attouni, an Investment Associate of the Republic of Cyprus and an advisor to Norachem, sees Cyprus emerging as a potential hub for such quasi-national biotrial frameworks. By providing regulatory sandboxes and infrastructure like Biobanks and Data Centers, Cyprus could allow innovative research groups to conduct trials with more flexibility.
"There is huge potential for distributed communities, maybe located in different places, to build in the real world here," Kyriakos said of attracting network state-style projects.
This synergy between biotech advancements and legal frameworks exemplifies the transformative potential of Network States, promising a more accessible, transparent, and efficient future for startups, investors, and communities alike.
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