The Neuro Funding Rollercoaster

And a great stroke association president would find new sources of money to drive research. Proper grant writing to foundations with a defined stroke strategy to solve all the problems in stroke. Small donors who would gladly give if it could be demonstrated that the research will provide actual solutions to stroke survivors. But we have fucking failures of stroke associations with complicit boards of directors. This lack of research and money proves we have NO stroke leadership.
Does no one in stroke understand how foundations work? Or how to raise money from donors?
http://www.dana.org/Cerebrum/2016/The_Neuro_Funding_Rollercoaster/
A s much as we like to frame research for neurology and psychiatry as being rooted in harnessing   science to improve the practice of medicine, the arguably crass but sobering reality is that while applied neuroscience may be ultimately judged by its scientific/medical achievements, the process depends upon the availability of money for the arduous research and development journey. The most extreme roller-coasters found at amusement parks have nothing on the stomach-churning oscillations of funding for research devoted to neurology and psychiatry—other than the latter is timed in months and years, rather than seconds. The past decade has seen the flow of resources for applied neuroscience sink to a stunning nadir, followed by an even more astounding resurgence.

But this recovery has been very uneven, and some areas, particularly psychiatry, have yet to rebound to anything near their former levels of fiscal well-being. Even this retrospective appraisal comes during a period of flux reflective of, and exacerbated, by geopolitical, political, and demographic dynamics currently at a peak. We recently experienced the best year for neurotherapeutics funding in over a decade, perhaps ever. But as early 2016 unfolded, the gains of 2015 receded like a favorite vacation spot shrinking in the rearview mirror; there has been a dramatic retreat from investment by both institutions and pharma partners. 

As of the end of April, the annualized projection for institutional funding/investment was down more than 50 percent from last year’s total, and partnering (in terms of disclosed upfront payments) was down more than 75 percent. It remains to be seen to what degree this is a transitional hitch in the recovery process, or a return to a painfully familiar climate of angst and parsimony. We believe it is the former, but this is a hypothesis yet to be tested by time, and there is more than ample pessimism about resource-availability to be found in the venture-capitalist community.

With that caveat noted, we will examine the past decade in the funding of neuropsychopharmacology, as well as cell and gene therapeutics, in terms of the enormous perturbations that have occurred within the institutional investment climate for the neuro sector and in the pharma industry’s willingness to partner neurology/psychiatry programs in development by smaller firms. We will focus strictly upon these two fiscal domains. The third major R&D resource, governmental grant funding, took on greater salience during the recent period of fiscal deprivation, but its role is to some degree compensatory: such funding partly (but never entirely) makes up for shortfalls in investor/pharma dedication to neurotherapeutics. 

Serendipity and Stasis

Our discussion will not address the massive scale of unmet medical need to be found in populations suffering from neurological and psychiatric illness. Nor will we analyze the lack of substantive change in treatment options for these patients. Suffice it to say that, in spite of the billions of dollars spent searching for better treatments for neurological and psychiatric disorders, and the myriad advances made in basic neuroscience, when it comes to real-world therapeutic drug options, the situation has been one of near stasis. Our antidepressants do not differ significantly from those that were available 20 years ago; the same can be said of our antipsychotic options, used primarily for schizophrenia and bipolar disorder; and for the modest cognitive enhancers marketed for Alzheimer’s.

The one exception—an area where significant advances have occurred in terms of efficacy and ease-of-use—is in the treatment of Relapsing-Remitting Multiple Sclerosis (RRMS). The beta-interferons gave rise to IV natalizumab, then the oral S1P targeting compounds, and the oral fumarate-based drugs. It is the one disorder where we are now able to actually slow the progression of the disease, rather than simply masking or suppressing symptoms, and the repertoire comprises a range of choices with a spectrum of risk-reward profiles from which patients and their physicians can choose. It is also the area where the regeneration of what has been lost, in terms of neural circuits and functioning, is now being first attempted. Advances for RRMS represent the way we hope neurotherapeutics for other disorders will evolve over the next two decades.

There are several reasons for this era of stasis. First, the great psychiatric drug classes that emerged during the 1950s and 1960s were largely the product of serendipity; the clinical observation of   therapeutic effects that led to post-hoc hypotheses explaining how these drugs might work—hypotheses that were for the most part—questionable at best, wrong at worst. They failed to provide a road map for their successors; many scientists embarked on research journeys launched by assumptions that turned out to be incorrect and guided by processes that misinformed. There was a false sense of confidence based on the commercial success of new drug classes that had become popular due to a better side-effect profile, rather than improved efficacy, like the SSRIs and second-generation antipsychotics. The pharmaceutical industry became, for lack of a better word, “lazy” when it came to internal R&D; imitation was frequently more prized than discovery, as many companies tried to piggyback on the success of earlier drugs through tweaking rather than innovating. To the degree to which innovation was permitted and funded, there was a tendency towards premature closure, choosing new mechanisms for full development without adequately auditioning the range of alternatives. The single best example of this is Alzheimer’s, where the bulk of research funding and testing over the past 20 years has relied upon an amyloid hypothesis that, even now, has yet to prove itself to be valid.

A Crisis of Faith

Because the brain is often described as the most complex structure in the known universe, neuroscience is fundamentally more challenging and less advanced than other areas of medicine. One key problem has been—and continues to be—that the tools with which neuroscience R&D is carried out have been inadequate to the task, and generally less effective in their application than those available to other therapeutic endeavors. This has yielded an inevitable string of failures.

In the world of animal models, the theoretical underpinnings have mostly been dubious, and the issues numerous. The system used for classifying disorders is based on categories that date back a century or more. What’s more, the pathophysiological roots of most disorders are unknown; targets for intervention have been generally based on theories derived from animal models of ambiguous relevance, and are located behind the blood-brain-barrier, making it difficult to get drug candidates where they were needed. It has been for the most part impossible to be sure if target engagement has been achieved. And the endpoints by which clinical status and progress are measured in human testing still tend to be ambiguous and subjective, particularly in psychiatry.

From a pragmatist’s point-of-view, the question might better boil down to: Why would anyone invest in this area? The customary and admittedly true answer generally involves “unmet medical need,” but the existence of such needs, great as they may be, does not in itself form a bridge to the treatments being developed for them. To a large extent, we have been flying blind, without much in the way of instrument-assistance. The definition of success has been binary, determined by whether the flight landed, or ended in a crash. The wreckage of many highly-touted programs litters the runways of the biopharma industry, and has come to dominate the perception of the neurotherapeutics area in the eyes of many (albeit not all) investors and pharma companies as being too risky.

Confidence in biopharma’s neuro-skillset was gradually ground down to a nub via a drawn-out series of high-profile failures, which led investors to question whether neuroscience had any idea what it was doing. The full list of failures is too long and disheartening to review in detail, but clinical landmarks that played an important role in squandering industry credibility include:

·         Myotrophin and ALS (1997)

·         Substance P and depression (1999)

·         Free radicals and stroke (2006)

·         Bapineuzumab and Alzheimer’s (2012)

·         Pomaglumetad Methionil and Schizophrenia (2013)

The net effect of these failures over a period of 15 years was to flag neurology and psychiatry as 'too hard,' leading to the nearly complete departure of GlaxoSmithKline from neuroscience, and significant contractions of neuroscience programming at Sanofi, Merck, Lilly, and others.

No Exit: The Existential Angst of the Venture Capitalist

Even as the success rate of neuroscience R&D plummeted, the First World was approaching a macro-economic near-death experience. The fiscal crisis of 2008-2010 led to a dramatic retraction of capital investment, and investors became highly skittish when it came to investment risk. This made it extremely difficult for privately held biotech companies to go public, and threw a major obstacle into the cycle by which capital enters and exits the biopharma system.

While travelers tend to ignore the safety feature demonstrations provided by a flight attendant before each take-off, assuming that exits available for emergencies will not be needed, such is not the case for venture capital and institutional investors, for whom the location and timing of an exit are core components of their investment model. In biopharma, such exits take the form of IPOs, wherein public money comes into a company, replacing much of the private investment that sustained the company to that point, and provides continued liquidity via stock sales. The simultaneous withdrawal of Big Pharma as a potential acquirer, along with this closing of the IPO “window,” meant one thing above all for anyone contemplating investment in the neurotherapeutics area: Once invested in a small company, there was no near-term exit at hand. 

Even worse, with no promise of new investors, the initial investors were increasingly confronted by the choice of either doubling down on a high-risk venture, or letting it wither and die. Venture capitalists, who operate in pre-defined life-cycles, typically less than ten years, could not credibly assure investors that they would be able to retrieve their investment, hopefully with profits attached, in that promised timeframe. This, in turn, reduced the inflow of resources to these venture capitalists, impairing their ability to sustain old investments, let alone make new ones, and thus produced a vicious cycle of the first order.

To illustrate, consider the casualty rate amongst 81 private cognitive neuroscience companies that NI Research tracked, beginning in 2003: Of those companies, only 19.7 percent provided an exit for their investors (12.3 percent via acquisition, 7.4 percent via IPO), and 61 percent went out of business entirely, representing a complete loss for their investors. The remaining 19 percent have continued in private operation, many of them barely alive, a herd of neurotech zombies. They are far more likely to end up in the failure than the success column.

Graphs at link.