Senators press HHS over prediction markets on drug trials and FDA approvals
2 Democratic senators asked the Department of Health and Human Services what it is doing about prediction markets that let people bet on clinical trial results and FDA drug approvals.
What happened
2 Democratic senators — Angela Alsobrooks of Maryland and Ron Wyden of Oregon — wrote on Wednesday to Health and Human Services Secretary Robert F. Kennedy Jr., asking what the department has done about prediction markets that let people bet on clinical trial results and Food and Drug Administration approvals.
The senators said the markets could sway patients weighing whether to join a trial and warned of insider trading by researchers or regulators with access to nonpublic information. They asked HHS for internal messages about staff trading in the markets, its exchanges with the platforms and the Commodity Futures Trading Commission, and any internal studies of the markets' effects.
- Senators behind the letter2
- Kalshi's new valuation$40 billion
- Raised in the new round$1 billion
- Valuation in the prior round$22 billion
- Drug-trial markets launchedJuly 2026
The markets drawing scrutiny
Kalshi, which offers the contracts in the United States, launched its drug-trial markets in July 2026. The company said it limits them to late-stage trials, lists contracts only after enrollment has finished, and uses employment checks on traders in the markets.
Polymarket offers similar contracts only on its international exchange, which is not regulated in the United States. Kalshi chief executive Tarek Mansour said in July that the data deciding which drugs advance is largely locked away from the people who need it, and that bringing that information into the open is the point of the platform.
A fast-growing sector under pressure
Kalshi raised $1 billion in a round that valued the company at $40 billion, Reuters reported on October 29. The round, co-led by Sequoia and Wellington, came just over 5 months after a $1 billion round led by Coatue that valued Kalshi at $22 billion. Kalshi has overtaken Polymarket in market share over the past year, according to Dune Analytics data cited by Reuters.
Regulators are circling the sector. Earlier in the week, Utah's attorney general brought criminal charges against Kalshi and 2 senior executives, accusing the company of illegally promoting online gambling. Polymarket has faced delays with its United States platform launch and a probe by the Commodity Futures Trading Commission.
What to watch
The next step is HHS's answer: whether the department sets guardrails for its staff and for trial data, and whether the Commodity Futures Trading Commission limits event contracts tied to health care. Platforms may also tighten their own rules as lawmakers keep asking questions.
For now, the letter adds political pressure to a market that grew up fast and is still finding its rules. This post summarizes reported facts and our view of the risks involved. It is not a forecast and not investment advice.
