Lifesaving Innovation – Brought to You by Private Equity

Delivering Treatments for Leukemia, Alzheimer’s, Parkinson’s, Heart Disease, HIV, Cancer, Arthritis, Diabetes, and Other Conditions

This week, we’re spotlighting how private equity fuels pharmaceutical manufacturers that deliver life saving treatments for patients across our country.   

Investing $123 Billion to Bring Lifesaving Treatments to Market

Over the past ten years, private equity has invested more than $123 billion in pharmaceutical manufacturers. These investments have enabled the development of treatments for several life-threatening conditions, such as Leukemia, Alzheimer’s, Parkinson’s, heart disease, HIV, and breast cancer, and for several debilitating conditions, including rheumatoid arthritis, diabetes, and ulcerative colitis.

On average, it takes 10-15 years and more than $2.6 billion to develop and bring new medicines to the market. Patients nationwide suffer from nearly 7,000 rare diseases, but only 5 percent of those have an available treatment due to these delays and barriers. In fact, only 12 percent of the molecules that enter clinical trials ever receive Food and Drug Administration (FDA) approval.

Private equity helps finance drug manufacturers, especially over-the-counter and generic drug makers, that provide low-cost options to patients. Private equity firms also help pharmaceutical companies expand and become more efficient, introducing new technologies and resources that lead to better innovations at a timely rate.

Company Spotlight: Anthos Therapeutics

AIC member company Blackstone launched a new pharmaceutical company in 2019, Anthos Therapeutics, to create new therapies for high-risk cardiovascular issues. This led to the development of Anthos’ MAA868, which has the potential to prevent a variety of cardiovascular disorders with minimal or no bleeding risk, which would provide major advantages over the conventional standards of care.”  This new treatment could provide a safer alternative for the 12.1 million Americans expected to suffer from atrial fibrillation by 2030.

Saving Promising Drug Candidates

In January 2018, pharmaceutical manufacturer Pfizer announced it would shut down drug development for early- and mid-stage neuroscience drug development, citing expensive and time-consuming research costs. However, private equity firm Bain Capital stepped up to partner with Pfizer by forming a new company, Cerevel Therapeutics, to continue developing treatments for some deadly diseases, including Alzheimer’s and Parkinson’s. Bain invested $350 million in the new company, while Pfizer provided several key researchers and science officers. According to CNBC, “Its lead programs include a medicine for the symptoms of Parkinson’s disease that is likely to enter late-stage clinical testing next year, and one for epilepsy that is ready to start mid-stage studies. Other compounds target Alzheimer’s disease, schizophrenia, and addiction.”

Company Spotlight: Headlands Research

Headlands Research, a globally integrated clinical trial organization based in Portland, Oregon, partnered with KKR to change the clinical trial process and emphasize scientific rigor, quality data, and patient representation. “Headlands wouldn’t be where it is right now without the benefit of private equity, both from a capital perspective, but also just the resources and knowledge to build and grow,” said Mark Blumling, CEO of Headlands Research.
The first release in this series spotlights how private equity supports innovative medical devices, which can be found here. The second release on how private equity-backed urgent care centers can ensure rural communities access emergency and lifesaving health care services can be found here.
The American Investment Council’s full report on how private equity complements and strengthens quality, affordable health care can be found here.