MIT financial wiz calls for $30B megafund to back next-gen cancer drugs

MIT's Andrew W. Lo is looking to recruit investors for early-stage cancer drugs--courtesy of MIT

MIT's influential Andrew W. Lo is determined to recruit some of the world's biggest investors for a $30 billion megafund that can shift R&D work on early-stage cancer drugs into overdrive. 

Back in May, Lo was talking to reporters about a fund with $50 billion to $100 billion, but in a new piece for Nature Biotechnology and a chat with the hometown Boston Globe, the hedge fund operator and finance engineer has scaled back his plans to $30 billion, which would still dwarf any other private fund investing in biotech.

"Only with massive scale can you reduce the risk of this early-stage research,'' said Lo, who says the current funding mechanisms in place have largely failed to drive the kind of innovation that's needed. And Lo says he will organize a conference for next year to bring together scientists, VCs and big investors to further explore the creation of research-backed obligations that could generate billions in new investments from groups looking for long-term returns on a new generation of blockbuster drugs.

This new fund, he adds, could back 150 experimental drugs at any given time. 

"I've shown that when you actually look at the numbers, when you look at the financing, you can actually do a lot of good,'' Lo told the Globe. "The cancer folks don't understand this stuff. Because they're trying to cure cancer."

- here's the story from The Boston Globe