Academics still haven’t cracked the molecular code to understand what, on a basic science level, causes mental illness like schizophrenia.
This is the core reason why investors shy from investing in this widespread condition, a panel of venture capitalists said at this week’s World Medical Innovation Forum in Boston. It’s not because the target market, while enormous, consists largely of uninsured, low-to-no income patients. Of course not.
“Everyone has enormous compassion in that area, but by and large, we don’t really understand the mechanism,” said Corey Goodman, a managing partner at VenBio.
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Only $900 million has been invested by VCs into psychiatric drug development from 2004 to 2013, in a recent whitepaper from BIO. This figure’s particularly stark when placed in comparison with the $9.1 billion invested in oncology – and the $4.6 billion that went into neurology.
“The imbalance doesn’t surprise me at all,” said Jean-François Formela, a partner at Atlas Venture. He explained: While it may be getting simpler to treat a severe disease if it’s monogenic, complex mental illness like schizophrenia have multigenic causes – to say nothing of developmental and environmental factors. There are just too many unknowns.
“That’s going to take a long time for the academic community to figure out,” Formela said.
Yet mental illness is inordinately widespread – and expensive. Schizophrenia alone impacts 1.2 percent of Americans – about 3.2 million people. And it’s just a massive driver of costs in the system. There’s a dearth of info on the systemic costs of schizophrenia, but a widely cited 2002 figure says it cost $62.7 billion at the time. Whether that cost has increased or decreased, there hasn’t been much in the way of new drug development since then. And how? $900 million to all of psychiatry is a pittance over a decade.
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The knowledge base and the tools to augment therapies are taking off now, said Doug Cole, a general partner at Flagship Ventures. And gene sequencing will be key in bringing advances in psychiatric therapy up to speed.
“There’s been a lot of really good human genetics in the last few years,” Goodman said. “That’s where some of the breakthroughs are going to happen.”
