Aligning Financial Returns and Impact: Strategic Investing in Brain Capital
This session explores how private capital can propel brain innovation, simultaneously generating significant financial returns and societal impact. It highlights a crucial shift towards device-based interventions and the operationalization of scientific knowledge into engineering solutions, making neurotechnology an increasingly attractive investment. Recommendations focus on promoting quantitative measures for brain health, advocating for non-dilutive funding, fostering public-private partnerships, and ensuring equitable access to neurotech.
Discussants:
Dan Mannix, Advisor to Brain Capital Alliance; Founder, Nixam Synergy; Former CEO, RWC Partners - Moderator
Eric Bennett, Founder and Managing Partner, Brain Capital Partners
Amy Kruse, PhD, General Partner, Satori Neuro
Jacob Robinson, PhD, Professor Rice University; CEO, Motif Neurotech
This session explored how private capital can accelerate brain innovation while simultaneously generating robust financial returns and substantial societal impact. The discussion illuminated pivotal developments in the field, including the miniaturization of devices and enhanced capacity to process vast datasets, which are collectively creating unprecedented opportunities in neurotechnology. A significant shift from solely pharmaceutical treatments to device-based interventions for mental health disorders was emphasized as was the operationalization of scientific knowledge into engineering solutions as a key factor making the brain health sector increasingly attractive for investment. Panelists noted that investment in neuro-related ventures saw a significant increase three years prior, moving from a perception of being "uninvestable" to a new frontier characterized by high growth potential.
Challenges and opportunities within the brain capital investment landscape were also addressed. One significant hurdle in fundraising was identified as the reliance on "soft endpoints" and skepticism regarding adoption, a contrast to the quantitative measures prevalent in other medical fields. Despite this, optimism was expressed as pharmaceutical companies are increasingly recognizing neurotechnology as a disruptive force. The concept of precision psychiatry was further explored, with pharmaceutical interest in quantitative measures for improved clinical trial design and the potential of these metrics to reduce the stigma associated with brain disorders by presenting them as solvable medical conditions rather than personal failings. The crucial role of non-dilutive funding, such as government grants, in de-risking early-stage neurotechnology development was discussed, along with concerns about the potential threat posed by current uncertainties in funding levels. A key insight was the platform nature of neurotechnology devices, offering adaptability across various neurological and mental health conditions, potentially expanding the market and altering the financial model for drug development. Finally, concerns about equitable access and widespread adoption were raised, underscoring the necessity for thoughtful messaging and distribution strategies to reach diverse communities.
Recommendations:
Promote quantitative measures for brain health: Develop and utilize objective data to measure mental performance and treatment outcomes, similar to cardiac or oncology care, to increase investor confidence and destigmatize brain disorders.
Advocate for continued non-dilutive funding: Emphasize to policymakers and philanthropists the critical role of government grants and private philanthropy in de-risking early-stage research and development in neurotech, which is essential for commercialization and innovation.
Foster public-private partnerships: Where market forces alone may not meet societal needs in brain health, encourage government intervention through tax incentives or other mechanisms to align investor focus with areas of significant societal impact.
Leverage neurotech as a platform technology: Highlight the adaptability of neurotech devices across multiple indications to attract broader investment and maximize impact, moving beyond single-focus applications.
Address equitable access and adoption proactively: Develop strategies for inclusive messaging and distribution of neurotech interventions, ensuring they are accessible to diverse communities, including those in rural areas and underserved populations.
Next Steps:
Strengthen communication on impact: Realign communication strategies to clearly demonstrate how investments in basic brain science translate into tangible societal impact and commercial opportunities.
Explore alternative funding models: Investigate and support models like philanthropically funded focused research organizations to bridge the gap between early-stage research and venture capital investment, especially if traditional non-dilutive funding wanes.
Encourage international collaboration: Inspire other countries to increase their investment in non-dilutive and returns-based funding for brain capital.
