Harnessing the Crowd to Make Better Drugs: Merck’s Friend Nails Down $5M to Propel New Open Source Era

Luke Timmerman3/2/09Follow @ldtimmerman

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Biology has never really had a social-networking movement like open-source computing, where thousands of loosely-affiliated people around the world pool brainpower to make better software. If Merck’s Stephen Friend gets his way, about five years from now, he will have ushered in a new era in which biologists work together to make drugs that are better than any company can today inside its walls.

Friend, 54, is leaving his high-profile job as Merck’s senior vice president of cancer research, after having nailed down $5 million in anonymous donations to pursue this vision at a nonprofit organization getting started in Seattle called Sage, Xconomy has learned. I heard about this potentially transformative idea during a phone conversation a couple days ago with Friend and his co-founder from Merck, Eric Schadt.

Sage is built on the premise that vast networks of genes get perturbed, or thrown off-kilter, in complex diseases like cancer, diabetes, and obesity. Scientists can’t just pick one faulty gene or protein and make a magic bullet to shut it down. But what if researchers around the world capturing genomic profiles on patients could get all of their data to talk to each other through a free, open database? A researcher in Seattle looking at how all 35,000 genes in breast cancer patients are dialed on or off at a certain stage of illness might be able to make critical comparisons by stacking results up against a deeper and broader data pool that integrates clinical, genetic, and other molecular data from peers in, say, San Francisco, New Haven, CT, or anywhere else.

Besides helping scientists aim higher, this will make medicine more transparent than ever, Friend says. Physicians from around the world could look at genetic profiles from their patients, match it up with the Sage database, and then prescribe the medicine most likely to work, Friend says. The FDA could look for insight into the proper balance between the risk and benefit of a drug. Health insurers could look at drugs for certain patients that have the greatest likelihood of success, and pay for ones that work. Drug companies could use the database to weed out treatments that are bound to fail or cause side effects for patients with certain genetic profiles, potentially saving years of wasted effort and hundreds of millions of dollars.

“We see this becoming like the Google of biological science. It will be such an informative platform, you won’t be able to make decisions without it,” Schadt says. He adds: “We want this to be like the Internet. Nobody owns it.”

Some big names have signed on for the early incubating phase. Besides the full-time efforts of Friend and Schadt, the Sage board includes Nobel Laureate Lee Hartwell of the Fred Hutchinson Cancer Research Center; Paul Ramsey dean of the School of Medicine at the University of Washington; Richard Lifton, the chairman of genetics at Yale University; and Hans Wigzell, director emeritus of Sweden’s Karolinska Institute. For insight into how to apply lessons from the open-source computing world, the board has brought on John Wilbanks, the vice president of science at the San Francisco-based Creative Commons.

To get started, Merck is in the process of donating some needed equipment and software that has been used at the Rosetta Inpharmatics subsidiary in Seattle, Friend says. The Whitehouse Station, NJ-based pharmaceutical giant will also donate important genomic data that doesn’t relate to its proprietary drug discovery programs, Friend says. And, as Sage plans to build up a staff of about 30 people, it will draw partially from the remaining talent pool that worked for Friend and Schadt, since Merck announced last fall it is closing the Seattle facility and transferring some people to Boston.

Sage hopes to follow the road map of Facebook, which started on campus at Harvard University, quickly caught on there and built critical mass, and then expanded to other universities, before going mainstream. Sage will look for its initial spark at three institutions: The University of Washington, the Fred Hutchinson Cancer Research Center in Seattle, and Yale University. (Sage has at least one strong Boston tie already, with important brain tissue donations from Massachusetts General Hospital that will enrich the database.)

The last time Friend got together to collaborate with Hartwell, they co-founded Rosetta Inpharmatics in 1996 with biotech pioneer Leroy Hood. They sold that company to Merck for $620 million in 2001. Since getting absorbed into Merck, among its many projects, the company has been stitching together reams of genomic data from cancer patients that shows the interplay between the underlying DNA, the RNA messages that arise from it, and the proteins that ultimately carry out all those instructions and turn tissue into cancer that can be seen under a microscope, Friend says. Rosetta’s ability to put together those puzzle pieces into a coherent picture, much of which has been published in scientific journals, has been the difference in making mere correlations between biology and disease and actually establishing the root cause of the problem. This work by Schadt’s genetics group is what makes Sage possible, Friend says.

This progress within Merck hasn’t led to any specific drug Friend can point to on the market, but many candidates in the Merck pipeline have been enabled by efforts by the molecular profiling and then oncology groups led by Friend. This progress has inspired him and Schadt to imagine what they can do in the future if they could harness researchers from around the world to think about the same problems.

“This is a huge deal, because of who Steve Friend is, what he’s done, and what he wants to do,” says Chad Waite, a managing director with OVP Venture Partners, an early investor in Rosetta. “Steve dares to be great, over and over and over.”

As with any far-out vision, plenty of things can derail it along the way. What if researchers use different gene analysis machines, from Affymetrix, Illumina, or Applied Biosystems? How will Sage reconcile differences in how experiments are designed by different scientists? How will researchers be enticed to let go of their precious data, currently stored on password-protected hard drives and servers? How will Sage manage the intellectual property that arises from the database? Why would companies want to participate and run the risk of putting valuable proprietary data out in public? How will this get financed?

Some of these things Friend can answer, and some still need to be worked out. Software is already making it possible to manage differences between the various instruments scientists use, and deal with the differences in experimental design, Friend says. The intellectual property question is one important aspect that has to be settled as governing rules get established, he says. Companies may not want to dump all their data on drugs in early stages of development, but they may want to support other experiments that will boost the entire field of drug discovery without undercutting their competitive standing, he says. Sage is still thinking about how to create the best incentives to get scientists to join, and it seems to hinge on a couple of ideas. People who enrich the database will get peer recognition and rewards of professional status through the community, as happens in open source computing. Plus, early adopters will have an informational advantage over everyone else.

“Companies, and academic researchers, will come to the table because they don’t want to have a less informed view of the data,” Friend says.

Sage expects to draw financial support from foundations, government grants, pharmaceutical partnerships, and IT partnerships, Friend says. He wouldn’t disclose the names, or occupations of the individuals who have pumped in the initial $5 million in seed funding. But once Sage is up and running, it will need a $20 million annual budget to operate, he says. The partnerships are expected to come together over the next three to five years of an incubation phase, as the community of scientists grows and starts taking responsibility of the database, like with open source computing, and then costs will go down, Friend says.

Eric Schadt, Sage's chief scientific officer

This effort will also require cooperation from one especially unpredictable partner—society at large. All sorts of samples of tissue samples from patients showing signs of disease will need to get crunched into data that illustrates the complex symphony of DNA, RNA, and proteins that interact with the environment to cause the problem. If Sage can get its hands on this sensitive material, assure everyone it won’t be misused, and attract scientists to join, then society will benefit. The potential payoff is through fighting disease more in a more personalized way than today, in which the average drug is prescribed on a trial-and-error, one-size-fits-all, let’s-see-what-happens basis.

“This will fundamentally change biology,” Friend says. “We will have a more coherent way to think about disease.”

Luke Timmerman is the National Biotech Editor of Xconomy. E-mail him at ltimmerman@xconomy.com Follow @ldtimmerman