The Washington Post looks at the growth of venture philanthropy among disease charities, focusing on the Cystic Fibrosis Foundation and its $3.3-billion windfall last year from its investment in a pharmaceutical firm that developed a breakthrough drug.
The U.S. Food and Drug Administration last week approved a second cystic fibrosis treatment for which the Bethesda, Md.-based foundation had helped fund development. Over the past decade, dozens of medical nonprofits, including the Parkinson's-focused Michael J. Fox Foundation, the Leukemia & Lymphoma Society, and the diabetes charity JDRF, have embraced the strategy of investing directly in companies pursuing new drugs and therapies.
Venture philanthropy has fueled criticism that disease charities court conflicts of interest by forging financial relationships with the drug industry and risk profit displacing patients as their primary focus. Supporters say investment by nonprofits is filling a gap in drug development between basic research, generally funded by governments, and corporations' large-scale clinical trials.