"...a financial structure in which a large number of biomedical programs at various stages of development are funded by a single entity to substantially reduce the portfolio’s risk. The portfolio entity can finance its activities by issuing debt, a critical advantage because a much larger pool of capital is available for investment in debt versus equity. By employing financial engineering techniques such as securitization, it can raise even greater amounts of more-patient capital."To exemplify this, they propose a cancer megafund. Read the paper for more details, but these illustrate flows...
02 October 2012
R&D Megafunds ~ Novel Securitization Financing
Fascinating piece just published in Nature Biotechnology by our MIT colleagues Jose-Maria Fernandez, Roger Stein and Andrew Lo on Commercializing biomedical research through securitization techniques. They propose RIBOs -- Research & Innovation Backed Obligations -- or R&D megafunds...
Labels:
Bio,
Capitalism,
Finance,
Markets,
MIT,
Nature,
philanthropy,
Research,
Securitization
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Through an open-source information-sharing platform called AkvoRSR, funders can also collaborate and communicate with on-the-ground partners to ensure the efficient and effective use of funding. fundmycontract.com
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