Prediction markets Kalshi and Polymarket face criticism for allowing bets on clinical trial outcomes
Prediction market platforms Kalshi and Polymarket have begun allowing users to place bets on the outcomes of clinical trials and FDA drug approval decisions. Researchers and at least one patient's family member have publicly criticized the practice, raising concerns about insider trading and potential interference with trial integrity. Kalshi argues the markets generate useful information about drug development and says it has safeguards against manipulation.
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Kalshi and Polymarket, two lightly regulated prediction market platforms where billions of dollars are traded weekly, have expanded into a new category: letting users wager on whether experimental drugs will succeed in clinical trials or receive FDA approval. Current markets on Kalshi include bets on a weight-loss medication and a breast cancer treatment; Polymarket is taking wagers on cancer treatment approvals and whether the U.S. will permit Chinese peptides to be sold domestically.
Joshua Pederson, a humanities professor at Boston University whose 12-year-old son is enrolled in a clinical trial for cancer after a recurrence following chemotherapy and radiation, said the platforms failed to reckon with "the fact that there were going to be patients on the other side of these bets." He described the prospect as "quite ghastly," arguing that bettors rooting for a trial to fail are "distanced from the real cost" — namely, that a trial failure means patients may suffer or die with one fewer treatment option.
Critics with clinical research backgrounds have raised concerns beyond patient welfare. David Tsai, who runs clinical trials at a Bay Area biotech company, started an online petition calling for such betting to be banned, arguing it "threatens the very foundation of trust and integrity in biotechnology." He described scenarios in which a pharmacist or coordinator with a financial stake in an outcome could alter variables — such as infusion rates or drug storage temperatures — to influence results. Nicholas Zaorsky, a professor of radiation oncology at the Mayo Clinic in Jacksonville, Florida, said that unlike other prediction market domains, clinical trials involve investigators and coordinators who "can directly influence aspects of the outcomes being wagered on," creating financial incentives that "risk undermining trial integrity."