Investing to Save Our Memories
Updated: May 21
Increased funding and identifying the most effective investment strategies are crucial to tackling dementia.
In addition to reduced quality of life for those affected with dementia, the World Health Organization (WHO) estimates that this disorder costs the global economy approximately US$818 billion (£598 billion) per year, or 1.1% of the global gross domestic product. Despite focused research as well as funding and development efforts, uncovering ways to treat, prevent, and cure forms of dementia like Alzheimer’s have remained elusive. Considering not only the amount of funding allocated for dementia research, but also identifying the most effective investment strategies are crucial in our efforts to tackle this disease in the years ahead. A couple of investment strategies have stood out to be the most effective.
Funding for dementia research comes from various sources, including governments, charities, private investors, public companies, and venture capital firms (VCs). Each of these organisations defines success in the fight against dementia differently. Governments, charities, and private investors focus primarily on supporting basic fundamental science to address disease aetiology. Alternatively, public companies and VCs concentrate their funds on supporting research related to novel disease-modifying drugs. This latter group is particularly well suited to take on the risky endeavour of investing in these drugs.
Funding efforts from public companies and VCs are vital in the embryonic stages of dementia research and must be maintained if not ramped up in the years ahead.
The number of dementia drugs from public company-funded research in clinical trials has been growing, but it has not been without disappointment. Pfizer, for example, has experienced consistent setbacks in the realm of dementia research, including a 2012 partnership with Johnson & Johnson for the drug bapineuzumab that failed in its second round of clinical trials. They consequently dropped out of the dementia drug race and shut down their neuroscience program entirely in 2018. Others have considered a similar move, contemplating relaunching efforts when more is known about the causes of dementia. Even with upsets, these large companies are best positioned for the massive expense and risk in getting dementia drugs through clinical trials—costing an average of US$1.4 billion (£1 billion) and taking ten years. Recently, promising news came from Biogen, Inc. seeking FDA approval for their drug aducanumab, which can potentially slow the progression of Alzheimer’s disease.
VCs activity in the dementia space can be characterised by heavy investment in small private companies over the past couple of decades. Biotechnology and biopharmaceutical sectors stand out in terms of investment priorities for these groups. Small private companies targeted for VC funding are often start-ups conceptualised and headed by academics within their affiliate labs. These endeavours are funded initially by governments and, seeking commercialisation, need scaling up with VC funds. One exciting example, backed by Bill Gates amongst many other entities, is the Dementia Discovery Fund (DDF). With US$342 million (£250 million), it is the largest dementia-focused VC fund. The success of VCs approach can be summarised well in the mandate of the DDF “to interrogate novel hypotheses and expand the breadth of targets and mechanisms” with its fight against dementia.
Over the past three years, I have had the privilege of researching dementia at the University of Cambridge’s Chemistry of Health, which was built with government funds of US$24 million (£17.6 million) and a private donation of US$6.8 million (£5 million). As academic researchers collaborate closely with our affiliate start-up lab, Wren Therapeutics, we can contribute our foundational basic science research to the results-driven goals of a leading start-up in the dementia space. Successfully raising over US$45 million (£33 million) from VCs, Wren Therapeutics has been necessary for catalysing and commercialising our university-led research in the name of dementia therapeutics. Funding efforts like these from public companies and VCs are vital in the embryonic stages of dementia research and must be maintained if not ramped up in the years ahead.
Ryan Geiser [2018, St John's College] is researching drug repurposing for the therapeutic treatment of dementia. Also, he is the co-founder and chief investment officer for ATP Asset Management.