1999 A Foundation Acts Like a Venture Capitalist, and Scores Big
In the 1980s, researchers uncovered the genetic cause of cystic fibrosis. But by the late 1990s only incremental improvements in treatment were in place, despite decades of investments in researchers by the Cystic Fibrosis Foundation. Most sufferers of the disease continued to pass away by their 30s.
So in 1999, the foundation decided to shift gears. Instead of just funding academic researchers, it would put money directly into pharmaceutical companies, seeking to speed useful drugs and also to interest the industry in making its own larger investments in lifesaving treatment. The Cystic Fibrosis Foundation eventually poured $450 million into investments in a variety of small and large drug companies, an example of what is sometimes called “venture philanthropy.”
These bets paid off in a big way. In 2012, a breakthrough drug developed with CFF funding was approved by the FDA. It treats underlying causes of the disease rather than symptoms. In 2015 an even more broadly effective drug was approved; it offers significant relief to half of all sufferers. These compounds may double the life expectancy of some patients.
In addition to catalyzing these clinical breakthroughs, the foundation recouped its investments. It sold its rights to future royalties from the drugs for $3.3 billion. These proceeds will allow the Cystic Fibrosis Foundation to maintain and expand existing patient support services while directing additional money into a “supercharged” scientific search for a long-term CF cure for all patients.