Early-stage funding

With an annual budget of around $50 billion, the NIH (US National Institutes of Health) is the world’s leading funder of biomedical research. With a significant portion of this budget being allocated towards funding basic research (the process of discovery and exploration of fundamental scientific mechanisms) through grant awards, private investors tend to have very little tolerance for funding basic research.

In turn, it is widely accepted that investors prefer to fund late-stage therapeutics development, where commercialization and exuberant profits are imminent. While this model works well for late-stage biopharmaceutical companies, it leaves early-stage companies – those that the industry rely heavily on for new therapeutic candidates – with few options available for financing.

As a widely discussed topic and even with ongoing empirical research underway in the world of financial engineering, we find that newly proposed solutions for alternative financing options remain insufficient for early-stage efforts, often having high barriers to entry, such as the need to register as a publicly traded company. [8], [9] In the rare case where an early-stage drug development effort can procure private investment, their ability to receive additional funds is all but certain.

Between high unmet medical needs for patients, sub-par organizational structures, and limited options for financing much-needed early-stage development, we propose a comprehensive solution that seeks to address bottlenecks that have stifled innovation in this area.