The MIT Quant, and head of AlphaSimplex Group proposes a fund to invest in biotechnology cures for cancer.
The source article is here and Mr. Lo's proposal is here.
Born in Hong Kong and raised in New York City, Lo lost his mother last year to lung cancer. He, like many people, also has watched friends and colleagues struggle with the disease in its various forms.
As an economist, he said, “I felt pretty helpless.’’
So he decided to focus on an area where he could have an impact: funding sources for cancer research.
In his Nature Biotechnology paper, Lo calls the current business model for drug research and development flawed, noting that the number of drug applications per dollar of spending is declining, and pharmaceutical stocks as a group have fared poorly over the past decade.
Under Lo’s proposal, the oncology fund could pour money into more speculative, early-stage research in exchange for a percentage of future royalties or proceeds from sales of intellectual property. A successful cancer drug can generate $2 billion a year in revenue, he said.
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