The pharmaceutical company will share the proceeds with the indigenous people who donated their genes

When Stephane Castel first met with a group of Māori and other Pacific Islanders in Fresh Zealand to talk about his pharmaceutical company’s plans for genetic testing, locals feared he might be trying to profit from the genes of community members without giving them much thought. a lot of attention.

Instead, Dr. Castel and his colleagues explained, they wanted to strike an unconventional deal: in exchange for being entrusted with the genetic inheritance, participating communities would receive a share of the company’s revenues. Dr. Castel also promised that he would not patent any genes – as many other companies have done – but rather the drugs his company developed through the partnership.

“A lot of people told us it was a crazy idea and it wouldn’t work,” Dr. Castel said. But five years after that first conversation at the March 2019 Indigenous Health Research Conference, Dr. Castel’s gambit is starting to pay off for both parties.

On Tuesday, his Seattle-based company Variant Bio announced a $50 million collaboration with drugmaker Novo Nordisk to develop drugs for metabolic disorders, including diabetes and obesity, using data collected from indigenous populations. Variant Bio will distribute a portion of these funds to the communities it has worked with in nine countries or territories, including Māori, and will seek to make any medicines resulting from its work available to these communities at an affordable price.

Indigenous genetics experts said the deal was a positive step in a field plagued by accusations of exploitation and a chasm of mistrust.

“In the past, researchers entered Native communities with empty promises,” said Krystal Tsosie, a geneticist and bioethicist at Arizona State University who runs a nonprofit genetic repository for Native peoples. “Variant Bio is the only company, to my knowledge, that has explicitly mentioned benefit sharing as part of its mission.”

The idea for Variant Bio was born in a Manhattan bar in August 2018 over drinks between Dr. Castel and Kaja Wasik, who became friends while pursuing graduate studies in genetics at Frigid Spring Harbor Laboratory on Long Island.

Although their laboratory research kept them under the glow of fluorescent lights, they shared a passion for international travel, which they indulged in on backpacking trips to Peru and Chile. They dreamed of building a company that could transport them to distant places.

At the time, drugmakers were partnering with biological repositories such as the UK Biobank, which contains biological samples and medical records from half a million people living in the UK, to look for links between genes and disease.

However, these databases mainly consist of genes from people of European descent.

“What is the value of determining the order of 500,001 Briton?” Dr. Castel said. “There are only so many insights you can get by studying the same group of people.”

He and Dr. Wasik were more enthusiastic about recent discoveries of underrepresented groups, such as the discovery of novel gene variants affecting metabolism that were first identified in Inuit populations in Greenland.

Such variants may be more common, and therefore easier to identify, in historically isolated populations because they confer certain functional benefits to people following a particular diet or lifestyle, or simply because of chance events in their history. However, they can also serve as promising drug targets that will facilitate a broader swath of the world’s population.

With $16 million in funding from Lux Capital, a Fresh York-based venture capital firm, Dr. Castel and Dr. Wasik quit their jobs and started working full-time at their startup. In the company’s first year, Dr. Wasik visited eight countries in Africa, Asia, Europe and the Pacific, while Dr. Castel mostly diligently built the software platform from his base in the United States.

They asked ethics advisors to develop a benefit-sharing model and took a tour with the audience. They knew from the beginning that they would have to tread carefully.

In 2007, a member of the Karitiana tribe in Brazil told The Fresh York Times that his community had been “deceived, lied to and exploited” by scientists who collected their blood and DNA, which was later sold for $85 per sample. Tribe members who said they were encouraged with promises of medicine received nothing.

Ten years later, there was still no consensus on the optimal way to conduct such work. To protect against the so-called biopiracy, many countries have ratified the Nagoya Protocol under the United Nations Convention on Biological Diversity, which requires “fair sharing of benefits” from genetic resources. But protocol excluded human genomic information.

During Dr. Castel and Dr. Wasik’s trip to Fresh Zealand in 2019, researchers and community members were concerned by an earlier attempt by American researchers to patent an obesity risk test based on genetic research conducted in Samoa. The research universities did not include their Samoan collaborators as co-inventors in their patent applications, nor did they enter into formal benefit-sharing agreements with local institutions. (That patent application has since been abandoned, and the researchers said they always intended to share the benefits with their partners.)

One of Variant’s first advisers was Keolu Fox, an outspoken geneticist at the University of California, San Diego, who sharply critical of Samoa research.

“It is an extension of all other forms of colonialism,” said Dr. Fox, a Native Hawaiian who joined Dr. Wasik and Dr. Castel on their fact-finding trip to Fresh Zealand. He believed Variant could lead by example.

Under the company’s benefit-sharing program, up to 10 percent of a project’s budget is allocated to community programs, typically through funding to local organizations.

For example, as part of a Fresh Zealand study into the genetic causes of kidney disease and other metabolic disorders in Māori and other Pacific peoples, the company spent $100,000 to fund several local health organizations, as well as scholarships and research conferences for Indigenous people.

“Before Variant came out, we weren’t doing it because we couldn’t afford it,” said Tony Merriman, a gout expert at the University of Alabama at Birmingham who has worked with the company on two projects in the Pacific region.

Dr. Merriman said he also appreciated that the company made sure to share its findings with the community. In French Polynesia, the company’s research helped augment access to gout medications after finding that local people did not have increased risk of fatal drug reaction has been observed in some Asian populations.

The novel agreement with Novo Nordisk begins the second, long-term phase of the benefit-sharing program. Communities will share 4% of Variant’s revenues and, if the company is ever sold or goes public, 4% of its equity. That’s a percentage comparable to the royalties charged by universities for licensing their patents.