A rich philanthropist (someone like Bill Gates) creates a massive trust fund. The fund continues to re-invest its money to maximize the size of the trust. The purpose of the trust is to reward the person/company that discovers the cure for some disease. A "cure" could be defined as a reasonable treatment period followed by lifelong remission for 90% of patients....or whatever would be relatively air tight on defining a real cure.
The goal of the fund would be to give a massive incentive to someone (most likely a company) for curing a disease rather than providing treatments for diseases. This incentive would be in addition to whatever patent rights they would get as well. If the fund got into the hundreds of millions of $$'s, it would serve not only as an incentive to innovate, but also an incentive to be the first to market (and thus, first to claim the prize).
