MIT Laboratory for Financial Engineering Healthcare Finance Initiative

We apply techniques from financial engineering—including securitization and portfolio theory—to biomedical innovation and drug development, designing and promoting new business models and financing structures to help close the gap between early-stage research and patients.

Funding for translational medicine is becoming scarcer, and at the worst possible time—when we now have the scientific and engineering expertise to make major breakthroughs in our understanding of the molecular basis of many deadly diseases and how to treat or prevent them. The so-called “Valley of Death” in translational medicine is the result of many causes, but a common thread among them is increasing financial risks in the biopharma industry and greater uncertainty surrounding the economic, political, and academic environments within the biomedical ecosystem.

Our ultimate goals are to offer realistic solutions to this challenge, to design new mechanisms to raise pools of funds for science, and to prove that finance can play a role in finding answers to some of the key issues facing society.