Investors led by JPMorgan Chase & Co. (JPM) and the Bill & Melinda Gates Foundation formed the Global Health Investment Fund, which “will back late-stage development of technologies to fight killer diseases in low-income countries.” A group of investors including the Canadian and German governments and the Children’s Investment Fund Foundation committed $94 million to the fund. The International Finance Corp., GlaxoSmithKline Plc (GSK), Merck & Co. (MRK), Pfizer Inc. (PFE)’s foundation, Storebrand ASA (STB) are participating.
Global Health Investment Fund – Prospectus Excerpt
The Fund will invest in multiple companies and/or Product Development Partnerships (PDPs) who are advancing the development of promising health products and technologies for diseases that disproportionately affect developing countries.
The project being proposed is a US$10mm equity investment in a mezzanine fund, the Global Health Investment Fund, LLC (“GHIF” or the “Fund”), sponsored by the Bill and Melinda Gates Foundation. GHIF is seeking to raise approximately US$100mm for the purpose of improving global health. The Fund would support the development of drugs, vaccines, preventatives, diagnostics and other related technologies aimed at infectious diseases that cause significant morbidity and mortality in developing countries (e.g. neglected infectious diseases), as well as those that provide solutions for maternal, neonatal and child-health challenges.
Expected Development Impact
Given the Fund’s focus on the late stage in the development of many of the drugs, vaccines and diagnostics in the pipeline, it is reasonable to expect a large development impact on several fronts:
(i) possible replication of the business model and scale-up of the flow of additional funding into late stage development of drugs for neglected diseases;
(ii) millions of patients, and especially those in vulnerable population (children and pregnant women) will benefit from the drugs that will be commercialized through this vehicle;
(iii) by demonstrating the commercial viability of the proposed funding structure, this could prove to be an important catalyst for the development of drugs that otherwise would not be developed; and
(iv) demonstration effect to other charitable foundations that their money could be multiplied and effects of their charitable giving amplified through this funding mechanism, which is expected to bring positive financial return to investors…