Democratic Senators Ask HHS to Address Drug Trial Market Risks

Two Democratic senators are pressing the U.S. Department of Health and Human Services (HHS) over risks tied to prediction markets on clinical trials and Food and Drug Administration (FDA) drug approvals.

Sen. Angela Alsobrooks (D-Md.) and Sen. Ron Wyden (D-Ore.) sent a letter Wednesday, Nov. 11, to HHS Secretary Robert F. Kennedy Jr. They asked what steps the department has taken to limit risks from the contracts.

The lawmakers raised concern that the markets may affect patients deciding whether to join clinical trials. They also pointed to potential insider trading by researchers or regulators with access to information that is not public.

In the letter, Alsobrooks and Wyden warned that betting on trial and drug outcomes could weaken the scientific process, create harmful incentives for researchers, hurt trial participants and contribute to dangerous medical outcomes. They said HHS, the FDA and the National Institutes of Health should protect drug development and public trust with safeguards.

The senators requested internal HHS communications about staff participation in prediction markets tied to matters governed by the department. They also sought communications between HHS and the platforms, as well as with the Commodity Futures Trading Commission (CFTC), which regulates event contracts. Their request includes any internal HHS analyses of the markets’ potential effects.

Kalshi and Polymarket offer contracts on clinical trials and FDA drug approvals. Polymarket’s related markets are available only on its international exchange, which is not regulated in the United States.

Kalshi introduced its related markets in July with measures it said were intended to limit trading risks. The company said contracts would cover only late-stage trials and would be listed after enrollment was complete. It also said it would use employee-verification technology for traders in those markets.

Kalshi CEO Tarek Mansour described the markets as a way to make drug-development information more accessible. Kalshi spokesperson Jack Such said the senators’ concerns apply equally to equities markets generally, where he argued the scale and incentives for misconduct are greater than on Kalshi.