CF Foundation gains massive windfall from Vertex's Kalydeco
- Since the late 1990's, the Cystic Fibrosis Foundation (CFF) has invested $150 million in Vertex, which helped support drug development, in exchange for a share of its royalties.
- According to a Bloomberg report, CFF made a staggering $3.3 billion by selling its Kalydeco (ivacaftor) royalty rights late last year.
- Based on this deal, the CFF is now the largest disease-focused charity in the country by net assets.
This makes sense despite the fact that most charities don't get money from research they fund. The CFF has the right to "profit" from its vision and long-term investments, especially considering that these efforts have resulted in two game-changing CF drugs coming to market—Kalydeco and, very recently, Orkambi.
Considering that Kalydeco is roughly $300,000 per year and Orkambi is roughly $259,000 per year, the CFF may be able to use part of its windfall to help patients procure these drugs. In addition, the money can be used to further CFF's ongoing efforts in various areas, such as maintaining patient registries, setting up tissue banks, and supporting huge genetic-mutation databases.
Robert Beall, who has been CEO of the Bethesda-based CFF since 1994, decided to take a venture capital approach to funding for-profit companies—a precedent—out of sheer frustration. There simply was not a cure in sight in the 1990s, and many patients were dying by their 20s. His risk has paid off—and may be instructive for other disease-based charities.
- Bloomberg Business This medical charity made $3.3 billion from a single pill