So many promising medical innovations never reach their full potential as therapies or cures, languishing instead in a metaphoric place many of us in biotech know as “the Valley of Death.”
This valley represents the gap between when a scientist makes a discovery and when that work has reached the point when a pharmaceutical company will license it, or a venture capital firm will invest in it, to get it to the point to help the patients who need it.
A new idea now taking hold in academia offers the promise of a path out of the Valley of Death: Universities, whose labs are home to so many of these potentially life-changing discoveries, should raise a philanthropic endowment and use the money to fund the work of the scientists to advance their innovations. By applying the same sort of innovative, out-of-the-box thinking to our financial and philanthropic approach as we have applied in our scientific labs, universities can take major steps in bringing drugs and other therapies to market — and improving people’s lives.
In addition to getting therapies to the people who need them most — the patients — this notion has several other benefits. By keeping the work inside the universities until it’s ripe for outside investment, the universities can reap a greater financial gain from licensing revenue than they typically earn.
Since its launch in 2020, the UCSF Innovation Ventures Philanthropy Fund, which I currently manage, has supported innovative projects to advance along the translation pathway, including targeting a novel pathway for asthma treatment, performing preclinical validation for the treatment of kidney stones, and providing a one-two punch to KRASG12C cancers. We have raised $11 million and awarded 18 grants.
UCSF is not the only university realizing the importance of incubating drug discovery projects:
With pharmaceutical companies becoming more risk-averse, academic drug discovery has the opportunity to focus on novel pathways and targets. Major research universities are the perfect incubators for such innovations, because they have significant National Institutes of Health funding that enables them to uncover novel targets and mechanisms of action for so many diseases, common and rare.
Think of some of the high-impact drugs that began in university labs. Lyrica — an anti-epileptic drug that is also used to treat pain caused by fibromyalgia as well as nerve pain in people with diabetes (diabetic neuropathy), herpes zoster, or spinal cord injury — originated from research at Northwestern University. Xtandi, which treats prostate cancer, came out of UCLA.
Once a discovery is shown to have some promise, investors want to see several steps taken before they put their money at risk. These steps include lead optimization, preclinical validation, and testing for off-target effects and safety. That’s where the large funding gap leaves promising therapies to die in the Valley.
Additional funding can remove the risks so the most auspicious projects are then licensed to and incorporated into pharma pipelines, where they can enter clinical trials. This approach will also enable moving away solely from the “me-too” or “follow-on” phenomena in drug development.
For instance, we know that checkpoint inhibitors have been game changers. But we now need to develop new targets and pathways that are not known today, novel modalities for drug delivery, and better ways for diagnosing earlier. These discoveries can come only from academic settings where researchers’ curiosity-driven NIH-funded research is the seed that needs to be watered to grow into its full potential. That’s the gap that needs the philanthropic funding.
UCSF’s InVent Fund — short for Innovation Ventures — was the brainchild of Barry Selick, a biotech industry veteran who served several years as UCSF’s vice chancellor of business development, innovation, and partnerships. Selick saw the need to keep projects in-house longer to get greater returns for the university and the inventors, and to “de-risk” the projects so they would be attractive to investors.
The projects are rigorously vetted by industry veterans, chief scientific officers, and company founders. The funding levels are typically around $500,000.
The fund has received philanthropic support, which has enabled an extraordinary track record: Over the past three years, 18 projects have been funded with four exits (licensing or VC-backed start-up formation), including one project being part of Rezo Therapeutics, which raised $78 million in Series A funding.
The goal is to keep the fund evergreen, with its successes bringing money back to the university to replenish the fund’s coffers — and pay to advance new discoveries. Incubating technologies at the university also allows them an opportunity to mature and become less risky, making them more attractive to investors and ultimately more likely to become products that benefit patients.
The concept of an endowment for drug research has proved attractive to entrepreneurs-turned-philanthropists. People who built their own businesses understand the importance of early money, and they love the idea of nurturing bold new ideas.
Philanthropists have many choices when it comes to making donations. While funding buildings is great and important, what happens inside those buildings — the translational work — is most transformative.
The possibilities spurred by supporting such work are endless. It could lead to a drug that dramatically improves people’s quality of life — perhaps a new asthma treatment, or a novel mechanism that attacks cancer and keeps someone alive longer. It could be a digital health product to treat depression on a large scale using artificial intelligence.
In such cases, the philanthropists’ legacy would be scale, impact, and contribution to projects that could move more quickly to patient benefit while supporting a university’s mission and training the next generation of translational scientists and leaders.
That is indeed a legacy to tell the grandchildren about.
Roopa Ramamoorthi is director of the Catalyst Program and InVent Fund at UCSF.