A federal incentive set up to encourage research into unprofitable treatments for tropical diseases has prompted a $10 million private investment into a non-profit for treatment of a condition affecting millions.
This is especially exciting news for Professor David Ridley, who with colleagues Jeff Moe and Henry Grabowski, proposed the priority review voucher in 2006. It became federal law the following year.
"This is exactly what we had in mind when we proposed the priority review voucher program," Ridley said. "The voucher incentive is providing financial resources to complete the development of a drug that could help millions of people."
The Global Health Investment Fund announced it will invest $10 million in the non-profit pharmaceutical company Medicines Development to register moxidectin for the treatment of river blindness, also known as onchocerciasis. The debilitating condition is transmitted through the bites of infected blackflies and affects more than 37 million people, according to the World Health Organization, most of them in poor communities in sub-Saharan Africa.
If the U.S. Food and Drug Administration approves the medication, the manufacturer will win a voucher for expedited review of another drug. The voucher can be sold for millions of dollars.
Ridley wrote in a medical journal in 2010 that nonprofit developers could use the proceeds from transfer of the voucher to fund additional neglected-disease research. That is what is happening here. If moxidectin succeeds, the voucher prize will be used by GHIF to fund further innovation for global health.
"This creates a virtuous cycle in which the success of one drug leads to resources that can be used to fund another drug," Ridley said.
Standard FDA review takes about 10 months. A priority review voucher can cut that to about six months, which can make a big difference to companies with potentially profitable medications to sell. Four vouchers have been awarded so far, the most recent selling for $125 million in 2014.
"We're delighted that the teams at Medicines Development and the Global Health Investment Fund are making this vision a reality," Ridley said.
The eight-figure investment is also an example of impact investing—the idea that companies can make money while also providing a social or environmental benefit.
"What's novel here is that the impact investment fund is giving a non-profit drug developer money to invest in a desperately needed drug for a neglected disease in markets that otherwise would be considered too risky," said Cathy Clark, director of the CASE Initiative on Impact Investing at Fuqua. Clark is also co-lead of the Social Entrepreneurship Accelerator at Duke, which speeds global health solutions in developing countries and is part of USAID's Global Development Lab.
"This is a great example of the kind of cross-sector financial innovation that impact investors are pursuing worldwide," Clark said. "The voucher that the government created is the lynchpin that keeps the benefits to both parties clear and tangible, and millions of people stand to benefit."