Why Do We Need Investors? Doesn’t the NIH fund drug discovery and development?
You know that each stage of the drug development process can be time-consuming and expensive. But contrary to popular belief (a belief even shared by some in Congress!), the government does NOT fund most drug development.
That’s a myth that badly needs debunking. It’s absolutely true that the National Institutes of Health (NIH) does allocate grants to support early-stage scientific research. And NIH-supported investigators, most of whom work inside academic laboratories, play an important role in conducting the basic science experiments that lay the foundation for discoveries that could potentially play out positively in the clinical realm.
But the NIH does not develop drugs, full stop. Just take a look at what the government spends on clinical trials versus what the biopharma industry spends (spoiler alert: the NIH spends approximately 10% of what the industry spends). Academic research is a vital part of the scientific ecosystem. But neither academics nor the government actually develops drugs.
Innovation isn’t just something that arises out of a lab but needs to be shaped into a product-market fit. Often this requires that people with business experience partner with academics. See how RA Capital engages with academics in that collaboration:
https://media.racap.com/default-media/publicwebsite/Video/Planetnutshell-comp.mp4
If you’d like to dive deeper, read more here and/or here. [OPTIONAL]