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When I started going blind, I went from reading a newspaper to seeing only fuzzy lines on a page in the space of a week. Before that, I had been diagnosed with degenerative retinal disease, but my life had been so intact that I thought of it very little.
Suddenly, that changed and I turned to an urgent search for a cure, or at least a form of treatment. This experience is far from unique. Many of us have struggled with a physical or mental illness, or loved someone who has suffered or succumbed to one. We know the frustration of looking for possible treatments only to overcome obstacles.
Gene therapy and stem cell therapies have progressed so rapidly that there are now many promising avenues for even the most challenging diagnoses – blindness, pancreatic cancer and even Alzheimer's disease. However, too often, life-changing research is rooted in years of testing or stops before reaching patients. Often, the problem is not the lack of promising biomedical research: it is the lack of funding for the critical phase of "translation" between basic research and patient-ready medicines that venture capital and companies pharmaceutical companies are ready to support.
So I work with two senior members of the US Congress to solve the problem of missing money. This month, Sanford Bishop and Cathy McMorris Rodgers introduced a bipartite bill that, if pbaded, would provide a new way to fund biomedical research, which could otherwise be trapped in what scientists call the "valley". of death "between basic research and advanced research in the field of drugs and medicines. appliance development.
We call these new financial instruments "eye links". Here's how they would work: First, scientists from the US Eye Institute, belonging to the National Institutes of Heath, would choose the best biomedical research on treatments and treatments for visual impairment ready to be tested. This gives priority to research with the greatest potential and helps to ensure that taxpayers and investors are not fooled by fraudsters, such as promoters of the Theranos blood test group.
Each of these projects is risky and the chances of success are daunting; this limits their appeal to debt investors. We seek to reach a larger pool. The researchers would receive funding in the form of loans, while loans to a dozen or more projects would be bundled and sold as bonds. The US government would guarantee up to 50% of the capital of each bond. This structure diversifies risk, making securities attractive to long-term investors, such as insurance companies and pension funds, who normally avoid this stage of biomedical research.
The result is a unique public-private partnership. Biomedical researchers too small or too early in the research process to attract equity investors would have a new source of low-cost funding. Investors would benefit because the government provides experts to select projects and a safety net against total loss. The risk is always shared – limiting the moral hazard – but a new clbad of sustainable finance would emerge.
In 2008, the first sustainable financial instrument, green bonds, began with a small instrument with a very valuable guarantee from the World Bank. By the end of 2018, this global market had exceeded $ 500 billion. This experience has taught us a lot about the best way to build a new financial instrument with social impact. That is why the visual obligations would not only start with a federal guarantee, but would also include controls to protect the taxpayer and ensure that proceeds from the bond would be used to speed up treatment and treatment.
A renowned scientist told me that in less than a decade, $ 1 billion eye links would treat most forms of blindness. Science is so good and money is so scarce. It is worth it to try.
The author is managing partner of Federal Financial Analytics
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