Kalshi and Polymarket draw 'ghastly' criticism for clinical trial betting markets
Prediction market platforms Kalshi and Polymarket are drawing criticism for allowing users to bet on clinical trial outcomes. Critics call the practice 'ghastly,' warning it creates perverse incentives and treats patient health as gambling fodder. Researchers say the markets risk insider trading and interference with drug development. The platforms defend the contracts, which operate under CFTC oversight. A parent named Pederson, whose son entered a cancer clinical trial, said he learned of the betting markets through news coverage.
The backlash adds a medical-ethics flank to the regulatory pressure already building against Kalshi and Polymarket's biotech vertical. Researchers warn that trial investigators, pharma staff, and even patients could trade on material non-public information about drug outcomes before FDA announcements. The CFTC lacks settled rules for policing insider trading in event contracts, so enforcement would trail any abuse.
For Kalshi, the criticism threatens its effort to diversify beyond sports contracts now targeted by congressional bans and state litigation. A single scandal tied to patient harm would invite restrictions far stricter than those proposed for sports markets. Biotech's higher scientific stakes and congressional attention mean the platforms must build surveillance faster here than in any other vertical.
The criticism of clinical-trial betting joins a rapid expansion of biotech-related event contracts by Kalshi and Polymarket, after the pair launched FDA drug-approval markets just days earlier.