Illustrative worked example · not a real company recommendation
Indication prioritization: which patient population buys the most valuable next truth?
Illustrative example of choosing an indication by information value, not TAM alone.
The decision
Which indication should receive the next development dollar?
The best first indication may be the one that most cleanly validates the mechanism, not the one with the largest eventual market.
Evidence to collect
What must be known before deciding
- Mechanistic fit
- Biomarker concentration
- Endpoint speed/objectivity
- Patient availability
- Competitive intensity
- Regulatory path
- Commercial option value
What could overturn the thesis
Disconfirming evidence matters
- A clean proof-of-concept indication may have limited commercial upside
- A large market can hide heterogeneous biology and slow the signal
Cheapest credible next truth
Rank indications by information value per dollar and month, then separate platform-validation value from end-market value.
Do not let TAM dominate the decision before human proof exists.
Alternative paths
| Path | What it buys | Primary risk |
|---|---|---|
| Mechanism-rich niche | Cleaner signal | Smaller market |
| Large common disease | Large upside | Noisier/slower proof |
| Parallel exploration | Preserve options | Consumes more capital |
Decision gate
GOOne indication offers a materially cleaner, faster path to a decision-changing human signal.
MODIFYSequence two indications rather than declaring a permanent winner.
KILLNo indication offers a credible proof path within the capital constraint.
What I would do Monday morning
Three actions, in order.
- Define the human signal that validates the platform.
- Score 3–5 indications on information value.
- Fund the indication that can answer the mechanism question fastest credibly.