Over the last couple of years, non-fungible tokens (NFTs) have become a common buzzword. Many types of digital assets are traded as NFTs, such as artworks, merchandise and real property. NFTs are increasingly being discussed in the healthcare industry. While welcomed in some parts, concerns are also being raised, including with respect to IP and commercialisation.
What is an NFT and how could it be used in digital health?
NFTs are digital-only pieces of data that are minted, can be bought or sold and are stored on the blockchain, which is akin to an online ledger.
NFTs have been touted as a way for patients to commercialise and track their own health data.
They offer the potential to allow digital health companies to encourage participants in studies and allow them to earn money from the commercialisation of their data stored via an NFT.
NFTs could allow the patient to offer their data to others, via the NFT on a digital marketplace. There has even been discussion as to whether NFTs could go further to cover biospecimens removed from patients.
Given the obvious sensitivity of health-related data, its commercialisation through NFTs is not without issues. Proponents of NFTs for medical data claim it allows patients to regain control of their health data and personal information.
As an NFT is a smart contract, it could allow the owner of the NFT to set rules or parameters as to who could use the data, such as only for certain types of research. The actual cost of minting an NFT may put off many patients.
AImedis launched an NFT marketplace last year, claiming to be the first of its kind, offering a unique way to buy and sell medical and scientific data.
Other opportunities include the ability for digital health companies to sell NFTs offering physical or virtual health related goods or services. For example, Moody Mink Society is an NFT collection to allow the NFT holder to access their space in the Metaverse to access mental health workshops.
The US pharmacy chain CVS recently applied for several NFT and metaverse related trade marks. Reports suggest that it aims to sell prescription drugs and other over the counter products in a virtual drugstore. CVS would authenticate the products through NFTs. There is a potential that the use of NFTs by manufacturers to streamline the authentication process could reduce numbers of counterfeit drugs.
IP issues and opportunities
Who owns copyright in the NFT?
One of the issues with using NFTs for health data relates to ownership of the health record.
Patients have some control regarding the use of their health data under privacy legislation, such as the GDPR. However, from an IP perspective, while the health information may relate to an individual, the copyright in the record itself would be owned by the creator of the record or their employer.
Even if the person who mints the NFT owns copyright, there can be issues with health data in an NFT. Earlier this year, it was reported that a French surgeon attempted to sell an X-ray of a patient, with a gunshot wound, as an NFT, which led to disciplinary action and potential legal action.
When commercialising content as an NFT, the owner should ensure that they own the copyright, or at least have a broad enough licence to permit such commercialisation.
NFT trade marks
From a branding perspective, companies in the digital health space should consider expanding their trade mark coverage to cover NFTs.
While most digital health businesses should already have class 9 covered in their trade marks, their existing protection may not be broad enough to cover NFTs, particularly in countries where the trade mark classification needs to be very specific. This extended trade mark coverage will also assist in protecting against unscrupulous third parties.
While there are likely to be multiple opportunities for the use of NFTs in the digital health industry, it will be interesting to see which types of NFTs will succeed. Digital health companies should carefully consider their IP protection, particularly their trade marks and licences, so that they are fully prepared for NFT commercialisation.
For more information, contact a member of our Intellectual Property Team.
The content of this article is provided for information purposes only and does not constitute legal or other advice.