On Tuesday, The Bill and Melinda Gates Foundation launched a $125 million research fund to support drugmakers and academics in the hunt for effective coronavirus treatments. The Gates Foundation and the Burroughs Wellcome Fund contributed $50 million each, and Mastercard (NYSE:MA) kicked in $25 million to launch the COVID-19 Therapeutics Accelerator.
Right now, there are no vaccines available that can prevent people from becoming infected with SARS-CoV-2, the virus responsible for COVID-19. Nor have any antiviral treatments been clinically proven to stop the virus from replicating in infected patients. The Coalition for Epidemic Preparedness Innovations is a $650 million fund currently supporting the development of potential new vaccines, but most studies of experimental vaccines to see if they actually work take about a year.
The COVID-19 Therapeutics Accelerator will devote its $125 million in funding to identifying potential treatments for patients who are already infected. These could have a more immediate impact because experimental antivirals can show evidence of efficacy in a matter of days.
The COVID-19 accelerator will help lower the financial risk taken on by companies and academics trying to develop antivirals specifically aimed at SARS-CoV-2. While there's a strong market for antivirals that tackle endemic viruses such as HIV, hepatitis, and influenza, developing treatments for diseases that may wind up eradicated from the planet isn't a sustainable business strategy.
At the moment, Gilead Sciences (NASDAQ:GILD) is testing remdesivir, which it developed as an Ebola treatment, to see it if it's effective against COVID-19, but that company boasts enormous cash flows that the vast majority of drug developers don't have.