Sanofi is re-upping its social media-driven Data Design Diabetes Innovation Challenge contest, which last year kicked up a wealth of innovative ideas and buzz for the price of $200,000 in prize money and a few salaries.

Innovation challenges like Sanofi’s essentially let companies build tech pipelines and stock talent pools at warp speed.

“Offering a $100,000 prize has yielded ideas in six months that would have taken four to five years to develop at ten times the cost,” said Sanofi’s Dennis Urbaniak, VP US diabetes.

The company today kicked off its second annual contest, which aims to boost development of apps and other tools to make life easier for people with diabetes, with a call for submissions to through March 23. Five semi-finalists will present their work to a panel of judges in May and then two finalists will be awarded $10,000 to participate in a “community uptake exercise.” A winner, to be announced in July, will claim the $100,000 grand prize.

Entrants keep all rights to their work. The payoff, for Sanofi, is in cultivation of talent, potential products to invest in and patient insights.

“We’re moving beyond the drug model into devices and solutions,” said Sanofi’s Michele Polz, who is head of patient solutions for diabetes at Sanofi US, last week at a conference. “We wanted to cast a wide net, look beyond the four walls we play in every day.”

Speaking about the effort at the Social Media Week Health & Wellness Hub, hosted by Saatchi & Saatchi Wellness, Polz recalled that the idea for the challenge came out of her chat at South by Southwest with Health and Human Services’ Aman Bhandari, who reports to the division’s chief technology officer. “It’s really a group of entrepreneurs in residence,” says Bhandari of his group. Bhandari told Polz about HHS’s health data initiative, a response to the Obama Administration’s Open Government Directive, which authorized Federal agencies to use “challenges, prizes, and other incentive-backed strategies to find innovative or cost-effective solutions to improving open government.”

“We wanted to liberate this data,” said Bhandari, and make it available for commercial innovation, much as The Weather Channel has built a media empire packaging publicly-available data from the National Oceanic and Aerospace Administration (NOAA). “We want to be the NOAA of HHS,” said Bhandari. “The healthcare system is under real duress and it’s going to take an all-hands-on-deck approach.” currently lists 53 healthcare-related challenges.

Polz wanted to emulate the Administration’s approach in diabetes patient care. She pitched the idea to her boss, Mr. Urbaniak, who said he’d greenlight it if she could get it up and running within six weeks.

Sanofi engaged consultancy Luminary Labs, which worked on the contest’s design. They started by crowdsourcing its parameters through Sanofi’s patient community, gleaned through the company’s blog and multiple Twitter feeds (Sanofi keeps separate handles for the company, its diabetes work and the contest, and employs a “community manager” to surf the social mediaverse and communicate with patients).

“You need to build your community before you need them,” said Polz.

The prospect of getting such an open-source effort through legal and regulatory in such a time frame would deter many pharma folks, but Polz sought to bring them into the fold by inviting them to the first “Demo Day,” at which semifinalists presented their projects.

“When you’re trying to do something in an organization, it’s typically a good idea to involve people and show, not tell,” said Sara Holoubek, CEO of Luminary Labs.

Last year’s winners, a pair of MIT grads calling themselves, went on to raise $1.7 million in seed funding with their behavior analytics app and grew their team from two to seven. This year Sanofi is adding a “Design and Prototype Bootcamp” for the semifinalists. Participants also get a partnership with Startup America.

Several other pharmas, including Janssen and Novartis, have since launched innovation challenge-style contests, noted Holoubek.

“It’s a win-win for everyone,” said Holoubek. “Startups are getting media attention and resources. Patients are getting new solutions, and Sanofi is getting new innovations. And they’re saving money by crowdsourcing and working with innovators.”