A new investment fund structured by JPMorgan Chase & Co. and the Bill & Melinda Gates Foundation will, for the first time, allow individual and institutional investors the opportunity to finance late-stage global health technologies that have the potential to save millions of lives in low-income countries.
With $108 million committed by a pioneering group of investors, the Global Health Investment Fund (the “Fund”) will help advance the most promising interventions to fight challenges in low-income countries such as malaria, tuberculosis, HIV/AIDS and maternal and infant mortality.
To help mitigate the risk of investing in the clinical development of new technologies, the Gates Foundation and the Swedish International Development Cooperation Agency have committed to partially offset potential losses in the Fund, which will seek a financial return for investors by targeting high-impact technologies with public health applications in both developed and emerging markets.
"The Global Health Investment Fund demonstrates the potential for innovative collaborations and thoughtful financial structures to mobilize new sources of capital for social challenges," said Jamie Dimon, Chairman and CEO of JPMorgan Chase & Co. "This product brings a diverse group of investors together around the shared objective of developing life-saving technologies in a financially sustainable way."
The Fund's investor group includes organizations such as the International Finance Corporation, GlaxoSmithKline, Merck, The Pfizer Foundation, Grand Challenges Canada (funded by the Government of Canada), the German Ministry for Economic Cooperation and Development (acting through KfW), the Children's Investment Fund Foundation, AXA, Storebrand and JPMorgan Chase, in addition to qualified individuals and family offices.
"We invest in global health because we know that when health improves, life improves by every measure," said Bill Gates, Co-Chair of the Bill & Melinda Gates Foundation.
Private sector financing for global health research and development is more important than ever. Philanthropy, government funding and pharmaceutical industry support have built a remarkable pipeline of global health innovations-with as many as 200 new products currently under development. However late-stage clinical trials are costly and development expenses are outpacing charitable support. Traditional investment capital can play a meaningful role in solving this problem, particularly when it is supplied by investors who include the expected social impact of their activities in their return calculations.
"This innovative fund is mobilizing financing for medical advances that could potentially save millions of lives," said World Bank President Jim Yong Kim. "It shows that we can align the needs of investors with the need for cures for diseases which cause so much suffering in developing countries."
The Fund will be managed by Lion’s Head Global Partners, a specialist asset manager dedicated to bringing capital markets solutions to support development in emerging economies. It will invest in new drugs and vaccines, emerging diagnostic tools, child-friendly formulations of existing products, expanding manufacturing capacity and other applications that will help bring affordable technologies to those most in need.
"Innovation and investment in global health research and development are the way forward in tackling pressing health challenges and delivering meaningful results for those most in need around the world," said the Hon. Christian Paradis, Canada's Minister of International Development. "This Fund is blazing the trail, and Canada is proud to have played a key role in its establishment."
"Millions of children die each year or suffer from debilitating conditions because the right treatment does not exist for them," said Jamie Cooper-Hohn, Chair of the Children's Investment Fund Foundation (CIFF). "Relatively little investment goes to the development of new drugs, vaccines and diagnostics specifically targeted at children in developing countries where child mortality is most dire. CIFF is very pleased to be a major investor into the Global Health Investment Fund, which promises to deliver new finance and focus to this neglected area."
Learn more about the Fund and the organizations involved.