The concept of free innovation has entered the technology lexicon, particularly when it comes to health care. The term refers to innovations developed in creators’ personal time and unprotected by patent or copyright. Hundreds of examples are visible on platforms like Arduino and Hackaday.

Free innovation is a variation on the decentralized supply and demand found in traditional markets. As in some other unconventional markets, it’s driven by motives besides the immediate monetary rewards directly attributable to product distribution. (Some indirect monetary rewards, like advertisements on a development site, sale of user data, or payoffs from resume-building, might be part of the equation.)

Why is free innovation gaining traction now in the health space? At least five features of the contemporary economy contribute to the trend:

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  • Digital technologies make it inexpensive and convenient for technologists to improvise and share their work.
  • Open-source platforms attract broad pools of talent (intellectually and geographically) to add layers of innovation on top of others’ work.
  • The gig economy and flexible work hours unshackle some innovators who previously would have been lashed to their office chairs too long and too steadily to devote sufficient time and attention to idiosyncratic projects.
  • A critical mass of technologists is motivated by altruism or deferred self-interest. This is seen in the open-source movement in software production and, more broadly, in the idea of open collaboration.
  • Legacy or, as one of us (R.G.) labeled it, “steampunk” regulation — slow, heavy-handed, command-and-control oversight designed for 20th-century coal-and-steel economies — is poorly equipped to handle 21st-century innovation. Free innovation offers ways to skirt or blatantly flout regulation in what our Mercatus Center colleague Adam Thierer calls “technological civil disobedience.”

The ‘artificial pancreas’ as free innovation

Consider OpenAPS, which aims to make artificial pancreas technology more available to people with type 1 diabetes. (A caveat here: While OpenAPS is a notable example of free innovation, we don’t claim the technical expertise needed to judge the safety or effectiveness of the devices.)

Artificial pancreas systems tie together a continuous glucose monitor and an insulin pump that are in constant communication with one another to keep blood sugar in a safe range overnight and between meals. OpenAPS reports almost 800 individuals worldwide using do-it-yourself closed loop artificial pancreas systems, and that users experience improved “time in range” for blood glucose levels as well as improved quality of life.

The regulatory impetus behind OpenAPS shows in the group’s social media hashtag: #WeAreNotWaiting.

An OpenAPS pump/continuous glucose monitor Courtesy Dana M Lewis

The FDA carefully — and tightly — regulates medical devices like continuous glucose monitors and insulin pumps. So how does OpenAPS navigate FDA oversight? It makes clear that its devices aren’t FDA approved; nor are the devices bought and sold for money, which could trigger immediate FDA scrutiny and oversight. The group’s home page sums up these points as follows: “[The FDA’s] responsibility is to regulate products on the commercial market and help safeguard the public. OpenAPS is NOT a commercial product and is not sold or distributed in any way.”

Because the devices are do it yourself, the group says, “Individuals who build an OpenAPS are essentially doing an (n=1) experiment, which they have a right to do to/by themselves. This is not a regulated activity by the FDA.”

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OpenAPS’s interpretation of the FDA’s role represents the group’s interpretation of the FDA’s own description of artificial pancreas technology and the agency’s role in regulation. Of course, regulators and regulated entities often disagree over interpretations.

Acknowledging soft law regulation

In the 20th century, medical device regulation was designed for large, heavy, relatively immobile, easily visible, expensive technologies with easy-to-track money trails. That works well for a multi-ton, multimillion-dollar MRI machine. It’s far less effective for an inexpensive artificial pancreas system produced by the user or passed hand to hand through informal channels.

Recognizing the new reality of free innovation, some agencies have shifted toward gentler approaches to regulation that are less command-and-control and more encouragement-and-communication. This so-called soft law approach is seen in the National Highway Transportation Safety Administration’s thinking about artificial intelligence and driverless vehicles. Similarly, the FDA has published guidance for industry with respect to 3D-printed medical devices and medical apps.

We believe that the FDA would be well-advised to expand its use of soft-law regulation. Taking full advantage of the dizzying stream of innovations coming our way requires a faster, defter, more predictable regulatory regime than those procedures which dominated technology in the 20th century. This likely means more voluntary standards, co-regulation (tasks shared by multiple agencies, along with self-regulation), and guiding principles rather than hard-and-fast mandates.

Robert Graboyes is a senior research fellow with the Mercatus Center at George Mason University, where he focuses on technological innovation in health care. Sara Rogers is a former Mercatus research assistant and a student at the University of North Carolina at Chapel Hill.

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