Think Medical Research, But Think Smart
FasterCures/The Center for Accelerating Medical Solutions
Commentary & Think Medical Research, But Think Smart
We all know that philanthropic capital is uniquely positioned to play a powerful role in medical research. But fewer of us are aware of the importance of appropriately leveraged capital in creating impact and advancing promising research.
In 2010, philanthropies in the United States invested over $1.1 billion dollars in medical research. While an impressive number, it represents just 2.3 percent of the $140 billion invested by government, industry, and other groups in health and medical research that year. While funding for medical research has been growing incrementally on a year-to-year basis, public and private budgets are under increasing pressure, leaving a lot of promising research underfunded. In these tough times, therefore, it's more important than ever that we focus on doing more with our philanthropic dollars by investing smarter.
Leading the flow of "passion capital" into medical research are a relatively new type of philanthropic entity known as "venture philanthropies" — organizations of a philanthropic nature that operate in a venture-capital mode. In addition to bringing a sense of urgency to the medical research community, venture philanthropies and the medical research organizations they partner with are beginning to change the financial infrastructure of medical research by providing risk capital for innovative research at critical (and traditionally underfunded) stages of drug development. These investments are also succeeding at drawing in more traditional capital, including public investment, which further leverages the original funds by expanding the pool of available capital at critical stages. Venture philanthropies also play another important role, as their close relationships with patient communities enhance their understanding of and expertise in specific diseases, resulting in forward-thinking research programs focused on reducing the overall impact of disease and solving problems most commonly faced by patients.
The fact that venture philanthropies are proving to be major players in the medical research arena does not mean that all foundations and philanthropic entities need to adopt the venture funding model in order to make meaningful investments that advance the medical research field. Indeed, at FasterCures we believe it is better to focus one's philanthropic resources on building a medical research investment portfolio that is strategic, intelligent, and...smart. And we want to help. To that end, we've created a pair of giving guides: Getting Started: The Medical Research and Development Primer and Giving Smarter: Building a High-Impact Medical Philanthropy Portfolio. Both are designed to help foundations and individual philanthropists better understand the medical research process, identify critical funding gaps, and explain the unique role of medical philanthropy in accelerating cures. They will also assist you in defining your organization's philanthropic priorities, evaluating the potential impact of your investments based on established criteria, and articulating the key questions you need to ask any research team, company, or nonprofit institution you are thinking about supporting or investing in.
In addition to our publications, we are continuing to facilitate the flow of philanthropic capital into medical research by convening major stakeholders at our annual meeting, Partnering for Cures, which this year will be held November 6-8, in New York City. At this year's meeting, more than eight hundred venture capitalists, philanthropists, policy makers, biotechnology and pharmaceutical company executives, patient advocates, and medical researchers will gather for a series of engaging panels and one-on-one meetings, with the ultimate goal of advancing the field of biomedical research and finding cures to a range of diseases. Partnering for Cures is uniquely positioned to introduce new and emerging foundations and philanthropists to the fundamentals of medical philanthropy and to provide more seasoned givers with complete due diligence opportunities.
We hope you can be a part of Partnering for Cures — it is a unique effort that promises to jumpstart your due diligence process. We also encourage you to download the toolkit, which we have designed with your needs in mind. And we look forward to your working with us to develop the financial infrastructure and create the outcomes-focused approaches needed if we are to speed up the process of getting to much needed therapies more quickly.
Margaret Anderson is executive director of FasterCures/The Center for Accelerating Medical Solutions, an "action tank" working to improve the medical research system and speed up the time it takes to get important new medicines from discovery to patients. Prior to her appointment as executive director, Anderson was FasterCures' COO for five years, served as deputy director of the Academy for Educational Development, and led programs and studies at the Society for Women's Health Research, the American Public Health Association and the Congressional Office of Technology Assessment.