Monetizing Failure

April 15th, 2009

Posted by: admin

Recent comments by a Merck executive, that “Seventy-five cents of every dollar we spend on R&D goes to fund failure,” reminded me not only of an earlier post about ways to finance risky research, but about ways to monetize failure.  Now it seems counterintuitive to reward failure, but there is still useful knowledge in what doesn’t work.  Besides the fact that a certain hypotheses is incorrect, data generated by experiments can produce knowledge useful in other areas.  This is also true in pharmaceuticals, where certain best selling drugs (such as a little blue pill) were not developed for the purpose which has made them so popular.

A useful next question here would be whether or not there need to be new incentives developed for the review and use of these failures?  I don’t know whether a nudge or a push is called for, but it seems to me that an era of diminishing returns and constrained resources ought to encourage more mining of the past to find usable knowledge.  That it apparently doesn’t is frustrating.

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