As DOGE Shakeup Looms, a Thiel Protégé Looks to Disrupt U.S. Health Department
Jim O’Neill wants to boost drug innovation and make the department more efficient, giving him common cause with Elon Musk’s cost-cutting group.
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By Julia Black
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Feb 7, 2025, 9:00am PST
Comments by Omar Mezenner and Dwight Crow
In November, virologist Beata Halassy announced to the world that she had cured her own breast cancer using a treatment developed in a laboratory she runs. Many in the medical community celebrated her breakthrough, which she says has allowed her to live cancer-free for over four years. But some bioethicists worried that overpublicizing the results of her self-experimentation could encourage others with less expertise to reject conventional cancer treatment.
This criticism caught the eye of Jim O’Neill, a Peter Thiel protégé and biotech investor, who took a dim view of their complaints. “These people think curing cancer is unethical, but vaccine mandates are good,” he tweeted derisively in November. “Let’s make America healthy again.”
That slogan should sound familiar. It’s the same one Robert F. Kennedy Jr. has used to catapult himself into a nomination to lead the Department of Health and Human Services, the massive federal agency that includes organizations like the Food and Drug Administration and the Centers for Disease Control and Prevention. And shortly, O’Neill is likely to join forces formally with Kennedy.
President Donald Trump has nominated O’Neill for the No. 2 position at the agency. The Republican-controlled Senate is likely to confirm Kennedy’s appointment as early as next week, and O’Neill’s nomination is also expected to get the nod this spring.
As O’Neill and Kennedy prepare to take office, Elon Musk and his Department of Government Efficiency loom large in the background. Like O’Neill and Kennedy, Musk has railed against the FDA in the past, arguing at a Trump campaign in the fall that “overregulation kills people.”
The rhetoric from O’Neill and Kennedy has prompted some HHS employees to worry that the duo could work with Elon Musk and DOGE to shake up HHS, just as DOGE has been upending other federal agencies like the U.S. Agency for International Development over the past week.
Along with other federal agencies, HHS employees have already been offered deferred resignation through Musk’s “Fork in the Road” program, and have until February 10 to decide whether to accept. Meanwhile, the White House is reportedly preparing an executive order to cut thousands of jobs from the agency, which currently employs over 80,000 people.
O’Neill’s imminent arrival has sparked enthusiasm among some libertarian-leaning healthcare entrepreneurs and investors who hope he can help unlock a flood of biomedical innovation. Bryan Johnson, the centimillionaire longevity enthusiast, who has known O’Neill for years, is one of those people.
“The nature of drug discovery has dramatically changed, so we’re going to have to upgrade the regulatory environment to match the technological discovery that we’re going to be experiencing,” Johnson told me.
At HHS, O’Neill will have authority over the agency’s daily operations as well as significant influence on research programs and the development of regulations. O’Neill and Kennedy, who squeaked through a key Senate committee vote earlier in the week, will be responsible for allocating healthcare funding, setting food safety standards, regulating drug pricing and managing public communications in the case of a pandemic.
O’Neill, Kennedy and HHS did not respond to requests for comment on this story.
O’Neill arrives at this lofty perch after a career built on reconsidering the balance between personal freedoms and public health. He has also had tours of duty at several Thiel-run organizations, including his time co-founding the Thiel Fellowship.
A staunch libertarian, O’Neill has opposed public health measures such as vaccine mandates and fluoride in drinking water as invasions of personal choice. Meanwhile, he has advocated for measures to accelerate scientific advancement, like automatically approving medications already cleared in Europe and rapidly adopting medical AI technologies. He has applied this mentality to his investment portfolio, backing companies operating on the fringes of modern science, from cryogenics to anti-aging therapeutics.
With O’Neill and Kennedy taking over HHS, a dose of abrupt change is about to hit the American healthcare system, and Silicon Valley’s fingerprints are all over their plans. During Kennedy’s failed presidential campaign, he received hundreds of thousands of dollars from tech heavyweights including Jack Dorsey, David Sacks and Chamath Palihapitiya.
More recently, 8VC partner Sebastian Caliri has been “working closely with many of our respected friends coming in to run HHS,” according to a tweet by 8VC founder Joe Lonsdale. This month, Caliri published a report titled “A Healthcare Excellence Agenda for the New Administration,” which suggests reforming healthcare payment systems to prioritize health outcomes over volume of work, lifting restrictions on healthcare data sharing, and minimizing the role of Institutional Review Boards in clinical trials.
Members of the tech elite like Musk have keen interest in the regulatory process and an obvious reason for wanting to change it in their favor: Musk’s Neuralink, for instance, depends on FDA approvals to advance clinical trials for its brain-computer interfaces. At the same time, Antonio Gracias, a close Musk ally, has reportedly launched a $100 million bid to take over MDMA drug developer Lykos Therapeutics, which is seeking a new FDA approval strategy after the agency rejected its new drug application last summer.
In recent weeks, Musk and DOGE have embarked on a rolling blitzkrieg across Washington with the aim of cutting $2 trillion from the federal budget. HHS, with a $1.8 trillion annual budget, could be a juicy target for their efforts. Kennedy has already said he plans to eliminate 2,200 jobs across the agency.
This week, DOGE reportedly accessed systems at the Centers for Medicare and Medicaid Services and the Centers for Disease Control and Prevention, following up on earlier promises to target fraud and waste within health agencies. DOGE has also cut off payments to Lutheran Family Services, an HHS beneficiary that provides social services to refugees, while the Trump administration attempted to pause all federal grants and loans, causing turmoil in the government-funded medical research community. Meanwhile, all U.S. health agencies have been ordered to pause communications.
Some public health experts are alarmed about the possible downsides of a radically altered approach to governing U.S. healthcare. “You do need to have people who believe in scientific evidence, and that’s a problem when you have someone like Jim O’Neill,” said Diana Zuckerman, president of the nonpartisan National Center for Health Research. She added, “All those investors, don’t they want to be able to use safe and effective medical products for themselves and their families?”
Like Kennedy, O’Neill doesn’t have any formal medical background, a rarity for such high-level appointments within HHS. He does, however, have experience working for the federal government. O’Neill began his career in the Department of Education and then joined HHS under George W. Bush, climbing the ranks to become its principal associate deputy secretary during Bush’s second term. In his role, he had some powers over policy and programming. While O’Neill fought some regulations, like a proposed oversight rule on the use of algorithms in laboratory operations, Bush’s HHS was generally pro-regulation.
Tevi Troy, a former deputy secretary for the department who worked there with O’Neill, emphasized to me how O’Neill’s government background will give him a definite advantage in accomplishing his goals. Troy noted that Kennedy and some other Trump picks for Health and Human Services don’t have the same experience. (That includes surgeon Martin Makary and TV personality Mehmet Oz [aka Dr. Oz], Trump’s picks for running the FDA and the CMS, respectively.) O’Neill’s deeper government experience could mean the real nexus of power and change within the department comes to center on him.
“He’s in a unique position to have a lot of influence,” Troy told me. “I don’t remember a deputy secretary coming in with as much knowledge of the building as him—especially in conjunction with the other members of the top team who have less experience.”
O’Neill nearly became FDA commissioner during Trump’s first administration, but some of his past comments resurfaced, which may have tripped up his nomination. One came from a 2014 biotech conference at which O’Neill told the crowd the FDA should only be required to test new pharmaceuticals for safety, not efficacy. “Let people start using them at their own risk,” he said. “Let’s prove efficacy after they’ve been legalized.”
The other came from a 2009 speech at Thiel’s The Seasteading Institute in which O’Neill proposed changing laws so that organ donors could be compensated, saying, “There are plenty of healthy spare kidneys walking around unused.”
Many of O’Neill’s beliefs mirror Thiel’s—a clear signal of Thiel’s enduring political influence despite his less visible role in the 2024 elections—and the two have a deep relationship.
After Bush left the White House in 2008, O’Neill went to work for Thiel’s Clarium Capital, Mithril Capital and Thiel Foundation. He co-founded the foundation’s biotech investing arm, Breakout Labs, as well as the Thiel Fellowship.
He also shares some of Thiel’s most idiosyncratic interests. While serving on The Seasteading Institute’s board, he became an advocate for charter cities and other forms of politically autonomous special economic zones. Some of these zones, like Próspera in Honduras, have drawn controversy for conducting medical research, including human trials, while bypassing the kind of regulatory oversight they’d be subject to in a country like the U.S.
But O’Neill’s true passion is longevity research. For nearly 12 years, he sat on the board of the SENS Research Foundation, an anti-aging research organization that has received significant Thiel funding. In addition, he served as a board observer for Oisín Biotechnologies, which develops anti-aging gene therapies, and he currently sits on the board of ADvantage Therapeutics, which is working on treatments for neurodegenerative conditions like Alzheimer’s disease. (He will need to recuse himself from the board once he starts his HHS job.)
Fellow advocates in the longevity space have high hopes for O’Neill and the credibility he could lend their field from his perch at the health department. One item on their wish list is for the FDA to classify aging as a disease, which could unlock federal research funding, prompt insurance coverage of anti-aging therapeutics and accelerate medical interventions targeting age-related decline. O’Neill has in fact proposed creating an office of geroscience to redirect funding to anti-aging research.
Christine Peterson, founder of Foresight Institute, a nonprofit dedicated to frontier technology, hopes O’Neill can instill a different approach to drug development within America’s biotech and pharma industries.
“It would be much more cost-effective to say, ‘No, let’s direct our research money on the seven to nine drivers of all chronic disease,’” said Peterson, who first met him decades ago when Thiel began donating to Foresight Institute. “If we can nail even a few of those, we are going to gain so much health span and greatly reduce the money we’re spending for these chronic diseases.”
You’d be hard-pressed to find many stakeholders—from doctors to patients to investors—who are eager to defend the status quo in today’s U.S. healthcare system. America spends more money per capita on healthcare than most other developed nations and yet falls behind many other such countries on metrics like life expectancy, infant mortality and overall population health. The process of getting a new drug to market is slow, expensive and cumbersome, discouraging many would-be entrepreneurs from entering the space.
“Just to enter the process of getting FDA approved, you have to hire multiple consultants,” said Johnson, who has invested in several longevity-focused biotech companies. “It’s too complicated. It’s too arcane. It’s too hard to address. Now, that does not mean that I’m suggesting lower safety. We can maintain the same safety. It’s just extraordinarily hard to try to figure out how to navigate.”
Peterson believes O’Neill’s unusual background will make him a more honest investigator. She said, “It would be really nice if we had folks at the FDA who are not quite so tightly connected to big pharma, because here’s the thing—Jim does biotech advising, but he advises startups,” an approach she believes will lead him to favor disruption over entrenched interests.
The radical change O’Neill wants to bring to HHS could get stress-tested quite soon. Cases of H5N1 avian influenza have soared, and 67 human cases have been confirmed. Just a month ago, the CDC reported the first human death from the flu.
Before leaving office, the outgoing Biden administration awarded $590 million to Moderna, which produced one of the first Covid-19 vaccines, to continue developing a bird flu vaccine.
As recent experience in the U.S. shows, a pandemic tests a country’s ability to communicate public health directives effectively and innovate rapidly—both core responsibilities for HHS. Kennedy and his team’s skepticism of vaccines, masking and social distancing have concerned many public health experts, who worry it could exacerbate a crisis should a new pandemic arise. But if bird flu or a similar virus does make the leap to humans, some biotech leaders are optimistic that O’Neill and the rest of the Trump administration would channel the same energy that led to the rapid development of a Covid-19 vaccine during Trump’s first term.
The Trump world’s tendency to plow through political gridlock could actually be an asset in the case of another outbreak, said Mark Emalfarb, founder and CEO of Dyadic International, a company focused on protein-based biotech, including vaccines.
“Pharma hasn’t really retooled in 35 years,” he said, a problem that affects not only pandemic preparedness but everything from the cost of insulin to the availability of cancer treatments. “They need to get their heads out of the sand because God forbid this thing comes to humans,” he said of the bird flu.
Emalfarb was blunt about the situation. “These pharma companies don’t want to change, and the government doesn’t force them,” he said. “So radical change might actually get the job done that we actually need, because I do believe healthcare is an inalienable right to everybody.”
