A Portfolio Approach to Accelerate Therapeutic Innovation in Ovarian Cancer
17 Pages Posted: 11 Dec 2018
Date Written: October 25, 2018
Biomedical innovation in oncology has become riskier and more expensive, precipitating a withdrawal of private sector funding from the sector. In this article, we consider a portfolio-based approach to funding in which multiple distinct ovarian cancer treatment candidates are funded within a single structure. Twenty-five potential early-stage drug development projects were identified for inclusion in a hypothetical portfolio through interviews with gynecological oncologists and leading experts, a review of ovarian cancer-related trials registered in the ClinicalTrials.gov database, and an extensive literature review. The annualized returns of this portfolio were simulated under a purely private sector structure both with and without partial funding from philanthropic grants, and a public-private partnership that included government guarantees. We find that public-private structures of this type can increase expected returns and reduce tail risk, allowing greater amounts of private sector capital to fund early-stage research and development.
Keywords: biotech; venture capital; healthcare finance; investments
JEL Classification: G11; G12; G24
Suggested Citation: Suggested Citation