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RTW: Investing across Healthcare - [Business Breakdowns, EP.184]

Business Breakdowns

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Government Funding Fuels Basic Science but Not Therapeutic Development

During the early stages of drug development, government funding primarily supports basic science research, as seen with NIH grants. Once research begins to transition towards therapeutic applications, funding typically shifts away from government sources. The average journey for a new medicine spans roughly 15 years, with the initial year focused on laboratory research before entering clinical trials. While fundamental scientific exploration, like that of antibodies or mRNA technologies, requires governmental support because of the lack of business models, the funding landscape changes significantly as projects evolve towards potential treatments. Understanding the implications of these different funding phases is crucial for accurately predicting the success of various therapeutic modalities.

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