THE ETHICAL STARTUP?

Photo ID 345549 © Jonathan Mulkey | Dreamstime.com Abstract Emerging DNA marketplace startups aim to empower individuals with greater control and potential profit-sharing over their genetic data, but they face ethical tensions in navigating uncertain technological and commercial environments. Drawing on ethnographic research and ELSI scholarship, this piece uses the lens of bounded ethicality to show how limits in information, consent, and decision-making call for distributed “ethics supports” beyond individual users and firms. Focusing on cases such as LunaDNA, it outlines strategies, such as decision-support tools, transparent communication, and collaborative ethics infrastructures, to strengthen collective responsibility and ethical capacity in genomics and related fields. Introduction With universities in much of the world placing more emphasis on entrepreneurship and technology transfer,[1] the private sector is depicted as a key to advancing both basic and applied sciences. At the same time, widely publicized data breaches and stories of fraud have fueled skepticism about whether private sector innovation serves the public good.[2] In response, some biotech startups have begun to position themselves as ethical alternatives to traditional research and business models. This paper examines the ethical and institutional burdens that accompany corporate promises to empower consumers in managing their own health data, using emerging DNA marketplaces as a case study. Unlike earlier biobanking models, which relied on broad consent to data use and offered little direct benefit to individual participants, the profit-sharing approach promises more consumer control. These companies let individuals decide how their data can be used and share in the financial benefits when companies sell access to that data. But even companies that think carefully about these dynamics face challenges as they create technologies for a future that is difficult to anticipate. Startups can respond to the ethics challenges that come along with such uncertainty; this paper provides guidance on some key pathways. My interviews, surveys, and focus groups with employees and leadership confirm that many companies are searching for guidance on how to embed ethics into their operations.[3] DNA marketplaces offer a compelling site for examining ethical challenges that arise when companies promise to empower individuals with control over their health data, in part because companies, such as LunaDNA and EncrypGen, explicitly frame their platforms as “empowering” users.[4] Yet, these companies blur the boundaries between consumer platforms, research intermediaries, and data brokers, placing particularly complex ethical demands on users and institutions alike. This paper argues that such models reveal not only the limits of individual decision-making under conditions of complexity and uncertainty but also the ethical shortcomings of systems that shift responsibility onto consumers without sufficiently engaging the broader obligations of companies, platforms, and institutional actors. A Framework for Ethics Supports Among the many genomics products launched in recent years, a series of companies has emerged that offer a means for individuals to “rent” their DNA to companies and universities for research and product development. These DNA marketplaces have promised compensation in exchange for personal data, as well as privacy and transparency through novel technologies. Nebula Genomics, co-founded in 2016 by George Church, offered free genome sequencing in exchange for data-sharing on their blockchain-secured platform, or redeemable Nebula tokens for sharing genomic data sequenced elsewhere.[5] The following year, EncrypGen launched a blockchain marketplace which uses proprietary cryptocurrency to pay individuals for de-identified data,[6] and LunaDNA launched an offering of non-voting shares in the company in exchange for data use—e.g., 300 shares for a whole genome shared, a $21 value according to the company’s preliminary offering circular.[7] The marketplace model also allows participants to specify which types of studies their data would support, enabling them to opt in or out of research domains based on topic, perceived risk, or institutional or corporate affiliation of the research team. LunaDNA regularly invites participants to review and approve data use for new studies, including those with different levels of data access or revised shared offers. In addition to the challenges faced under prior models of consumer genetic data sharing (e.g., through Ancestry.com, 23andMe), these companies have struggled to meet the expectations they set around user control, data ownership, and financial benefit. LunaDNA was founded as a public benefit corporation, with the premise that by receiving shares, participants would benefit financially from any proceeds LunaDNA earned from that data. The company failed to build a steady revenue stream and eventually closed in early 2024, without issuing payouts to contributors, as the company reported no cash reserves.[8] Ethical, legal, and social implications (ELSI) researchers have noted the challenges that these DNA marketplaces face as data brokers that must gather ongoing consent and manage data privacy.[9] In this piece, I highlight the broader ethical challenges that such marketplaces face, considering the startup sector’s demand for continual innovation and often grandiose speculation, even in the face of frequent organizational change and evolution. While firms may have ethics infrastructures, such as ethics committees or institutional ethics policies, ethical issues today increasingly cluster beyond the confines of an individual company. Many problems emerge in the complex landscape of angel investors, venture capital firms, private wealth management entities, crowdfunding, accelerators, incubators, co-branded partnerships, tech transfer offices, service providers, and industry networks. While ethical approaches, such as anticipatory ethics, have been developed to predict and address ethical challenges early in the development of emerging technologies,[10] many issues today arise in spaces that lie beyond the control of a single platform, ranging from downstream data sharing by a DNA platform customer to further data use by unknown subsequent parties, to company acquisition, bankruptcy, breaches by partners, and other challenges.[11] To analyze these challenges, this paper applies the theory of bounded ethicality. Bounded ethicality suggests that social, psychological, and practical pressures limit people’s ability to make ethical decisions. For example, limits on available information, time constraints, decisional complexity, and bias contribute to ethical decision-making. [12] These limits point to the importance of moral supports to promote ethics and justice. Bounded ethicality recognizes the limits of the individual moral agent, instead spreading moral labor across platforms, collectives, supportive technologies, and contingencies. As shown below, combining this lens with a focus on downstream thinking can help companies and individuals establish well-designed ethical supports. Ethics Challenges for DNA Marketplace Platforms DNA marketplaces risk overpromising the degree to which they can protect data. In response to criticisms of earlier genomics companies that sold user data to pharmaceutical and other companies, including data brokers, without sharing benefits, these companies have created data use policies and means to allow participants to benefit.[13] But even so, substantial risks to data privacy remain. Data breaches, government or law enforcement demands that override privacy protections, and within the limits of both users' and technologists' capacity to anticipate abstract future scenarios.[14] The bounded ethicality lens draws attention to the importance of caution in companies’ framings of their offerings, recognizing the limits even with our best efforts for ethical practice, thus guiding us toward hedging the zeal with which companies advertise privacy protections, untraceability, and individuals’ control over their data’s use. Difficulties also arise because of the complexity of tasks DNA marketplaces ask of their users. The complexities of these tasks include taking control of their genetic data, assessing scientific risk, postulating future scenarios, quickly learning enough genetic science to become ably informed as part of a consent process, and engaging in ongoing monitoring of developments with the platform. Growing research shows that decision fatigue, readerly limitations, distraction, comprehension and educational factors, momentary mood or energy levels, and more impede sound decision making.[15] Unlike other industries where consent may be a one-time hurdle, DNA marketplaces demand repeated, proactive choices about whether to share their genetic data, opt in or re-consent to new studies, allow certain types of future use, and decline participation in others based on study type, affiliated institutions or companies, or perceived risk. It is crucial that companies describe the terms and conditions to help customers grasp the yet unknown ways in which data could be used, including adverse scenarios. At the same time, lengthy consent documents cannot fill this need, as they overwhelm participants and do not invite deep engagement with the issues at hand.[16] Another ethical issue is that significant debate persists about the risks of re-identification of ostensibly de-identified genomic data, which is possible with limited public information.[17] While some argue that little incentive exists for re-identification, there is insufficient evidence to support this claim. Companies must remain responsible for protecting users, rather than placing responsibility on consumers for protecting themselves via consent procedures.[18] Many ethical frameworks acknowledge that consen