A generation of philanthropists whose wealth was created via entrepreneurship in technology-driven fields has the chance to make a real difference in accelerating the fight against cancer. Our research has revealed a variety of investment approaches that can help speed up the development, approval and commercialization of new cancer therapies.
Rapid advances in precision medicine and immunotherapy are ushering in a new era in the treatment and cure of many cancers. And impact investing has emerged as a path to meet their goals. Three big ideas underlie these approaches: precision medicine, disease-focused investing and investing at scale.
The improved odds of success in drug discovery are providing donors opportunities to back what has become known as venture philanthropy. In this system, drug discovery is developed around a specific disease and financed by the efforts of a disease-focused foundation. What is needed are many investments aimed at the underlying causes of each specific cancer type. While this creates concentration risks, which are typically avoided by venture funds, they are precisely what disease foundations should be doing and where generation of philanthropists can make an enormous difference by taking on one particular type of cancer.
While venture-philanthropy funds represent a way to invest at scale in research related to a particular cancer, larger funds are beginning to emerge that invest at much greater scale in a broader range of cancers. Andrew Lo, a finance professor at MIT, has been a trailblazer in this area. Armed with numerous simulations, Lo has argued that a megafund of investments in cancer companies could not only help find cures but also produce more predictable returns for investors.
(Richard G. Hamermesh is a senior fellow at Harvard Business School. Kathy Giusti, founder of the Multiple Myeloma Research Foundation and the Multiple Myeloma Research Consortium, is also a senior fellow at Harvard Business School.)
