Introducing IP Tokens (IPTs): A New Incentive for Scientific Collaboration

What are IPTs and how do they work?

IPTs are IP governance tokens. They are synthesized using IP-NFTs, a digital contract that gives the holder the right to a piece of intellectual property. IPTs govern IP pools: pools of IP and R&D data from scientific research, shared sets of IP-related resources meant to benefit a community by facilitating cooperative management and commercialization of collective IP.

But why is this important and why should you care? As I mentioned earlier, IP is the fundamental value driver in drug development, but is intrinsically monopolistic, often stifling innovation. IPTs represent a marked advance over the traditional model — instead of a single company or corporation controlling a piece of IP, a variety of disparate stakeholders can control IP based on funding, work, or support given to a research project. Similarly, researchers can create bounties that enable other researchers and laboratories around the world to contribute data to their project, and in exchange, own governance over the IP that is being developed by thecollective. Our hypothesis is that giving patients and researchers governance over medicines will increase the quality and cost-effectiveness of drug development.

This is a very powerful concept. For years, experts in innovation have been suggesting the need for new innovation and collaboration models in drug development and technology development out of universities. Corporate structures and joint-venture agreements have severe limitations and tend to introduce unnecessary friction, particularly in very early collaborations that are high risk and where low administrative and cost overhead is a requirement. Here, IPTs fill the gap, enabling value creation to be shared from the earliest stages of a commercially-oriented research project.

IPTs represents a bridging of worlds — they enable an open-source level of collaboration without losing the commercial opportunity and value-capture known to incentivize progress in traditional legal entities. Combined with the right stakeholder base — patients, researchers, and aligned supporters — IPTs creates an arbitrage opportunity in biotech: they give more equity to patients and researchers, in turn resulting in a higher quality research for lower cost. We believe patients and researchers are in it for effective cures, not to make a quick buck.

What exactly do holders of IPTs have? Governance — and with it, great responsibility. One major observation we made while developing the BioDAO innovation model is that entity-level incentives (such as BioDAO tokens) are often not enough to power end-to-end drug development. While they can work to incentivize short-term collaboration and actions such as deal sourcing, diligence, and part-time efforts, they are insufficient to push forward individual projects at a high velocity. Whereas BioDAO tokens enable governance over an entire IP portfolio, IPTs enable governance over a single project’s IP and R&D data. This opens up new incentive frameworks for more granular levels of collaboration, incentivizing individuals to govern large stakes in projects in a pre-company state. For BioDAOs, it also means new sources of collaboration and liquidity. BioDAOs now have the ability to synthesize IPTs from their pre-existing IP-NFT portfolios and encourage new individuals, groups, companies, and even other DAOs, to collaborate with them, all the while accessing new sources of funding for the researcher and the DAO treasury. Collaborators could, for example, earn up to 10% of the IPTs supply in an asset for their collaboration and support, creating a strong incentive to move research forward.

What’s Next?

The first IPTs have already been synthesized. Token holders in the VitaDAO community participated in the VITA-FAST crowdsale for Viktor Korolchuk’s project on Autophagy at the University of Newcastle, which was oversubscribed by more than 1700%! More IPTs will be synthesized on additional projects soon!

We will be publishing about the model, first use cases, and all of the new possibilities enabled by IPTs. We are also eager to see what you build with them, and hear your thoughts to strengthen, improve, and iterate the model.

Visit vitadao.com and join their community to see the first IPTs in action.

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