April 27, 2016

UBS Raises Record $471 Million for Oncology Impact Fund

BioSpace.com 4/27/2016

World’s largest global wealth manager concludes fundraising for innovative impact investing fund aimed at developing cancer treatments

Zurich/Basel, 27 April 2016 – UBS Wealth Management has raised a record $471 million for the final closing of the UBS Oncology Impact Fund, an impact investing initiative aimed at developing cancer treatments.

Investments will be made in early stage oncology to accelerate the development of new cures. Cancer care is particularly appropriate for this kind of investment because of a supportive regulatory environment.
The market for cancer drugs is expected to grow faster than for any other disease, due to populations ageing in developed countries and an expanding middle class in emerging markets with better access to care. Oncology is the largest and fastest growing therapeutic area in terms of drug development activity, representing approximately a quarter of total research spend.

Impact investing aims to generate a defined positive social impact as well as a competitive return. It is an attractive area for investors who wish to align their portfolios with their values. It is potentially a highly significant source of capital for oncology, given cancer’s wide-ranging social implications.

In addition to investing in early-stage cancer treatments, the Oncology Impact Fund will support academic research and better access to cancer care in the developing world. A portion of any performance fees generated and half of a royalty attached with best efforts to all successful drugs sales will be managed by UBS Optimus Foundation and ultimately fund expanded access to cancer care for children and their families in the developing world. The other half of the royalty amount will be spent on academic grants to promising oncology-related research. The Fund has already struck the first royalty agreement of this type, bringing this innovative practice from theory to reality.

Jürg Zeltner, President of UBS Wealth Management, says: “The record sum raised for the UBS Oncology Impact Fund is a milestone for our work in sustainable investing and for the impact investing industry as a whole. We believe initiatives like this can give hope to cancer sufferers and their families and divert more capital towards finding treatments and cures.”

In its capacity as the world’s largest global wealth manager, UBS is helping to mainstream impact investing in response to demand from clients and from the community. Examples include the G8-affiliated Social Impact Investment Taskforce (now the Global Social Impact Investment Steering Group) and the WEF’s reports on mainstreaming impact investing. UBS contributed to both initiatives and has also integrated impact investing into its regular sustainable investing reports and Opinion Leaders white papers.

UBS Wealth Management’s Chief Investment Office has identified a number of other themes as attractive from an impact investing perspective, including textile supply chain innovation, affordable emerging market healthcare, insurance for climate change resilience, and protein alternatives.

Mark Haefele, Global Chief Investment Officer at UBS Wealth Management, says: “Impact investing gives our clients an opportunity to change the world and earn a financial return simultaneously. Using this growing medium to target cancer, one of the planet’s biggest killers, helps fulfil a critical social goal.”

Ansbert Gadicke, Co-Founder at bioventure investment manager MPM Capital, which is collaborating with UBS WM on the UBS Oncology Impact Fund, says: “We are delighted to be advising UBS on the management of this landmark fund. Over the long term, we hope this collaboration will add significant value in the field of oncology and in ongoing efforts to finance its development.”

UBS Wealth Management is a leader in sustainable investment. The collaboration with MPM on the Oncology Impact Fund follows other programs including UBS Optimus Foundation’s Development Impact Bond focused on education in Rajasthan, India, support for investment vehicles that invest through funds into small and medium enterprises (SMEs) in developing countries and inclusive finance initiatives across Asia and Latin America. It also supports the aims of the UBS & Society program, which seeks to create long-term, sustainable and measurable benefits for clients and communities.

MPM Capital is one of the most successful bio-venture fund managers of the past decades. The firm has 20 years of experience in identifying breakthrough therapies, mostly from academia, and building successful new companies for their advancement. Over the last ten years, MPM has had the largest number of IPOs in healthcare of any investment firm worldwide (34), according to company data