Update on crowdfunding in the regenerative medicine space

Author: Nick Dragojlovic, 05/26/14

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In a recent post on Signals, David Kent made the case for government-funded clinical trials of autologous stem cell therapies, since the lack of proven commercialization models in this area make it difficult to attract private investment. Another way of financing the clinical translation of stem cell therapies with limited commercialization potential is the use of philanthropic contributions. In particular, donation-based crowdfunding is emerging as a new source of funding for early-stage regenerative medicine research.

In the past month, for example, the Tisch MS Research Center of New York raised US$317,540 in a crowdfunding campaign on Indiegogo to support a Phase I trial of a therapy in which autologous bone marrow-derived mesenchymal stem cells will be used to create neural progenitors that the investigators hope will promote myelin repair in multiple sclerosis patients. Compared to other crowdfunding campaigns in the health research space, which mostly aim to raise less than $50,000, the Tisch MS Center’s campaign was exceptionally successful.

Four factors help to explain its success:

  1. There is a high degree of awareness about MS among the general public and a large and active existing disease advocacy community.
  2. The campaign was run by a foundation rather than an individual investigator, meaning that it could draw on the Tisch Center’s existing communications and fundraising infrastructure and use its donor base to imbue the campaign with momentum from Day 1.
  3. The proposed Phase I trial had already received approval from the FDA, which makes the potential impact on patient outcomes of donating to this project more tangible than for earlier-stage research.
  4. The proposed therapy has the potential to reverse the underlying damage caused by MS, rather than aiming simply to delay disease progression or alleviate symptoms.

This last factor suggests that regenerative medicine may have an inherent advantage in the crowdfunding arena because the aim of the field is to reverse damage and restore function. The perceived benefits of stem cell research have been tied to individuals’ willingness-to-pay for it in referendums like California’s Proposition 71, so it seems likely that therapies with regenerative or curative potential will be perceived as highly beneficial and will have the greatest appeal for donors looking to support medical research through crowdfunding campaigns.

Other recent regenerative medicine campaigns, however, point to the significant challenges posed by research crowdfunding. In particular, individual researchers who seek to crowdfund a project without support from fundraising professionals or an existing non-profit may find it difficult to raise even relatively modest amounts of financing through this avenue. This project to engineer educator cells that will prevent T cells from attacking insulin-producing cells in Type 1 Diabetes patients, for example, has only raised about a quarter of its $20,000 goal to date, though it is likely to eventually meet this goal because Consano tends to extend the term of the campaigns it hosts indefinitely.

Crowdfunding in the limited 30-60 day fundraising window provided by portals like Experiment is even more challenging. This campaign to fund research on the use of stem cells to treat heart disease, for example, managed to raise $1,704 from 18 donors, but it was not able to meet its $9,000 goal in the allotted time period. In contrast, a campaign to support mitochondrial gene therapy research by the SENS Research Foundation exceeded its goal of raising $7,000 from individual donors, but the campaign was helped by a $14,000 matching grant from Longecity, the foundation on whose website the campaign was hosted, and by its ability to tap the SENS Research Foundation’s existing donor base.

So is crowdfunding likely to catch on among the regenerative medicine community? My July 2013 post included a short poll to gauge readers’ thoughts about crowdfunding. All 15 respondents indicated that they would consider using a crowdfunding campaign to fund their own research, with 10 (67%) saying they would propose a translational or clinical research project, with the rest split between basic and ethical or social research. 13 of 15 respondents also indicated that they would be at least somewhat likely to donate to a credible crowdfunding campaign aimed at supporting regenerative medicine research.

While this sample is quite small, the results of the web poll do suggest that regenerative medicine researchers are open to exploring crowdfunding as a potential route to funding research. The successful campaigns described in this post suggest that this can be a viable approach. Before embarking on a crowdfunding campaign, however, investigators would be well advised to: 1) consider whether their project is likely to be attractive to donors (translational research probably has an advantage over other types of research), 2) find partners (e.g., a foundation, university development office, or crowdfunding professional) that can help plan and execute a campaign, and 3) commit the significant time and effort necessary to run a successful campaign.

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Nick Dragojlovic
Nick Dragojlovic is a health services researcher at the University of British Columbia's Faculty of Pharmaceutical Sciences. He has previously held postdoctoral fellowships at the University of Calgary and at UBC, and has received funding from the Canadian Institutes of Health Research and the Michael Smith Foundation for Health Research. He holds a BA from Yale University and an MA and PhD from UBC. Nick is particularly interested in the use of alternative finance mechanisms to support scientific research, and covers the topic on his blog: Funded Science
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