How to spend $25 million in two not-so-easy steps
How to spend $25 million in two not-so-easy steps
Global alliance polishing business plan
First, fill in the critical gaps; second, begin setting up what amounts to a stripped-down pharmaceutical firm. There. You’re ready to start making new anti-TB drugs.
That’s the brief (and deceptively simple-sounding) story of what the Global Alliance for TB Drug Development plans to do with a $25 million gift it soon will receive from the Bill and Melinda Gates Foundation.
The business plan emerged from an alliance "stakeholder" meeting held last month in London. With its new business plan in hand, the alliance now needs only to secure nonprofit status from the Internal Reveral Service; then it can collect the Gates gift and get on with its work.
The first part of the plan, which concerns filling gaps, involves identifying the most urgent needs in the process of drug development. "It’s looking at the whole product-development pipelines," says Carol Nacy, PhD, head of the Rockville, MD-based Sequella Foundation and a researcher who has Microsoft head Bill Gates’ ear. "It’s trying to figure out where companies that are working on TB drugs are having the most trouble getting the funding they need to move onto the next steps."
Two of the biggest gaps lie in areas with complicated-sounding names such as combinatorial chemistry and high through-put screening. The first means the work needed to build a "library" of hundreds of thousands of new compounds that might have anti-TB properties. The second refers to assays that quickly evaluate batches of the new compounds to see which look most promising.
The bread-and-butter of drug research
"This stuff is the bread-and-butter of drug research, but it’s also grunt work," says Nacy. "It’s not the kind of thing where you can easily get hypothesis-based grants."
One more urgent need is to find ways to finance early human trials of promising new drug candidates. "It would be useful if in its first iteration, the global alliance could also find funding for that," she adds.
For the long term, the alliance will begin building a sort of quasi-pharmaceutical firm — albeit one that consists of a stripped-down, no-frills model and depends heavily on volunteer work. The model is proposed by the Boston Consulting Group, a firm engaged by the Rockefeller Foundation, which spearheaded the formation of the alliance, to help direct formulation of the business plan.
What the consulting group has proposed is a prime example of a prototype known as an "incubator" model, a new take on start-up businesses that’s especially popular in cyberspace. It’s being tried by nascent companies that think big but don’t have much venture capital to back up their wish lists, says Tom Robinson, a Boston Consulting Group member.
The incubator model has certain advantages, Robinson adds. "With an incubator, you’ve got a [minimal] internal staff that provides management and expertise, so you don’t just wind up throwing cash at things," he explains. "But you do a lot at the virtual level, and some of the scientific advisory committees serve on a strictly volunteer basis. The idea is to have maximal impact with minimal staff."
By assembling a network of scientific and business expertise, the hope is that the incubator can serve as a focal point for drug development work, adds Robinson. "It becomes a magnet for attractive projects at any stage of research and development. You find [the projects], attach a manager to them, and provide advice about what study you need to do next or what preclinical work needs to be done now."
If all goes as planned, the result will be a pharmaceutical house aimed solely at TB drug development but minus a lot of overhead. "You create all the expertise of a big pharmaceutical firm, without having to hire it," adds Robinson. "Then you outsource a lot of stuff."
The same model is already at work in two other drug development projects: the International Alliance for Vaccine Initiatives (IAVI), a network of HIV/AIDS researchers dedicated to finding a vaccine; and Medicines for Malaria Venture (MMV).
Incubator models are appealing because they’re inherently thrifty, says Nacy. The down side is that since they’re a relatively new idea, whether they can work in public health enterprises remains to be seen. "They’re definitely a model the Rockefeller Foundation is familiar with and comfortable with," she adds, referring to the fact that the foundation has spearheaded the creation of IAVI, MMV, and now the TB alliance.
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