The recent controversial approval of the Biogen drug aducanumab (Brand name – Aduhelm) has stirred up debates in the medical community.
Aduhelm is the first approved treatment that works by attacking the disease process of Alzheimer’s instead of just addressing dementia symptoms. It’s also the first new medication to be approved by the FDA for Alzheimer’s disease in nearly two decades. The drug’s listing price is $56,000 a year, and is administered monthly via intravenous infusion with the intention of slowing cognitive decline in people with mild memory and thinking problems.
Controversy aside, this move by the FDA is a great indication of an increasing interest in neuroscience.
The Burden of Neurological Disorders is Growing
Over the past 30 years, the number of deaths and people with disabilities caused by neurological disorders has been on the rise.
Currently, over 100 million Americans—and one in six people globally—suffer from a myriad of neurological disorders. With over 1,000 known neurological disorders—some rarer than others— and nearly a third of the U.S. population affected by them, it’s not surprising that these conditions are the leading cause of disability and the second cause of death worldwide.
What’s worse is these numbers will likely grow.
It should come as no surprise to learn that neurological disorders are some of the most debilitating diseases to suffer from. People who suffer from these conditions suffer a major reduction in their quality of life, measured using Health Adjusted Life Expectancy (HALE) and Disability Adjusted Life Years (DALY).
In addition to being debilitating, these diseases are also some of the most difficult to treat. As a result, they place a huge burden on the healthcare system.
Currently, global healthcare costs are on the rise from a perfect storm of contributing factors:
- Increased life expectancy and an aging population
- A vast majority of neurological patients on CMS
- Costs of caring for patients with chronic or long-term medical conditions
- Increased costs of new medicines, procedures, and technologies
In the U.S. alone, over 86% of healthcare costs account for treating chronic conditions. So in addition to the direct costs of chronic disease, the indirect costs also leave their mark; lost productivity time, reduced quality of life, and absenteeism from work are just a few.
Spending on neurological conditions is estimated to be about $615B—5% of total healthcare spend—trailing closely behind spending in cardiovascular, diabetes, and oncology.
A New Era for Neuro Innovations
Historically, the neurology sector has been unattractive to investors, likely from an extremely high risk for an upside that isn’t big enough to justify the risk.
Not only are there slow response times from the diseases themselves, but patients are often prescribed life-long, difficult treatments they’re not likely to adhere to. In fact, treatment adherence is a major issue amongst neurological patients. The incentive to diagnose is simply not high-priority, and the inherent risks of neurological disorders has dissuaded potential innovators and investors.
Most of these trends are, however, changing. In recent years,there has been a growing interest in investing in the neuroscience field.
Over the past few years, Pharma has shown an increased interest in neuroscience and the global neuroscience market reached over $30.8 billion last year. Pharmaceutical companies are making significant investments in neuroscience startups hoping to discover:
- Methods for early disease detection
- Innovative treatments
- Potential cures for brain-related diseases and disorders
The growing interest in this field is enhanced by the measures put in place by the FDA in the form of breakthrough designations and other incentives to encourage the development of drugs and devices targeting this space. Increased access to non-dilutive funding and grants has also helped propagate researchers and scientists’ interest in this space.
While the outlook of neuroscience innovation seems promising, there are still unique risks associated with the sector:
- Neurological diseases are exceedingly difficult to treat and thus there is not a high incentive to adopt new diagnosing technologies.
- Most neurological disorders are subjective and require personalized treatments and individualized medicine.
- Cross sectional use cases are difficult to achieve.
Investing in C.Light Technologies
A few months back, we invested in C. Light Technologies . C.Light’s device is a tracking scanning laser ophthalmoscope (TSLO) that helps to diagnose and track neurodegenerative disease progression. The device is capable of imaging down to a cellular level and tracking movements down to a cellular level. The mechanism of action is based on the principle that microsaccades (small, jerk-like involuntary eye movements), a type of fixational eye movements (FEM), have predictive value for monitoring disease progression by essentially tracking motor dysfunction.
For us, C. Light represents most of the things that we look for in this space:
- The device targets a disease area that affects millions of people and is ripe for innovation
- There is substantial proof of concept in clinical research and scientific data to demonstrate the mechanism of action
- There is a clear path to reimbursement and willingness from providers to adopt the device
- The device fits into the clinical workflow
At Creative Ventures, we are increasingly focusing on targeting the big five categories of neurological disorders – Headaches, Epilepsy and Seizures, Stroke, Alzheimer’s Disease and Dementia, and Parkinson’s Disease. We believe that it is essential for the product or device not to create the conviction that the technology is unconventional and attempts to defile human nature. Too much deviation from the norm leads to an essentially higher probability of rejection and raises questions about ethicality. Devices or products that are noninvasive, portable, interoperable, safe are more likely to be adopted.
We are excited about a few innovative trends: stem cell therapy, early diagnosis, and treatment of Alzheimer’s disease and other dementias, brain biomarkers, gene therapy, mental health, and neuroimaging, amongst others.
For promising startups and founders that align with this investment thesis, contact me.