A new report from the Massachusetts Institute of Technology (MIT) is faulting the U.S. government for failing to maintain and grow its investments in basic scientific research, even as European and Asian nations are dramatically increasing their research and development (R&D) spending. Andrew Lo, a finance professor at the MIT Sloan School of Management and one of the report's authors, says the cutbacks in basic research could have a high cost in both national prestige and long-term economic opportunity.

U.S. securities regulators have tapped a list of well-known stock market experts to serve on a new advisory panel tasked with helping shape rules affecting high-speed traders and dark pools.

For years, Brad Margus has juggled two goals as chief executive: Make money, and find cures for his children. He just co-founded a startup, Exigence Neurosciences Inc., in part to seek treatments for his two sons who have ataxia-telangiectasia or A-T, a rare progressive and eventually fatal neurological disease... “The amount of money needed to develop a single drug is so much more than what pure altruism can fund,” says Andrew Lo.

The quest for a treatment that can combat Alzheimer’s remains frustrating and expensive, but Andrew Lo believes he may have a path forward. A finance professor who directs the Laboratory for Financial Engineering at the MIT Sloan School of Management, Lo thinks that a public-private partnership could solve some of the funding issues that have plagued drug discovery and development.

Researchers argue for a public-private superfund to advance many Alzheimer’s therapeutics projects in parallel.

MIT economist, Andrew W. Lo, calls for Alzheimer’s ‘megafund’.

More than 5 million Americans suffer from Alzheimer’s disease, the affliction that erodes memory and other mental capacities, but no drugs targeting the disease have been approved by the U.S. Food and Drug Administration since 2003. Now a paper by an MIT professor, Andrew W. Lo, suggests that a revamped way of financing Alzheimer’s research could spur the development of useful new drugs for the illness.

Creative investments could fund a huge number of new drug-development projects.

Here in the Boston area, cancer researchers abound. But there is something of a crisis in the field. As a professor/friend of mine who runs a lab here in town tells me, research has identified a host of therapeutic targets, but “results from the clinic have not produced encouraging outcomes and, to date, there have been no reliable lasting responses to therapies against many malignancies.”It seems that cancer cells are proving better than researchers thought at evasion. They evolve, adapting to treatments and circumventing them. Out-of-the-box thinking, and funding, may be what’s necessary.

Professor Andrew W. Lo discusses his proposal to use financial engineering to spread risks among investors and provide financial incentives to develop successful cancer treatments. He explains how the cancer megafund works, and how investors can make good money in finding a cure for cancer.

What if I told you about an investment fund that diversifies your portfolio, shields you from fluctuations in the stock market, and earns double-digit returns? Sounds interesting, right? Did I mention that this investment also creates potentially life-saving treatments for deadly rare diseases? This fund doesn’t exist — at least not yet. I’m cautiously optimistic, however, that in the near future we’ll see the launch of an orphan disease “mega-fund” that finances early-stage biomedical research and drug development and is also a tidy investment.

MIT Sloan Professor Andrew Lo authored this blog post about the development of a mega-fund to finance research and drug development for orphan diseases.

MIT Sloan finance professor Andrew Lo applies a hedge fund approach to increasing investment in drug development

Economists and financiers are thinking creatively about investing in cancer research, in desperate need of funding. Earlier this week, some of America's top cancer doctors convened in Boston for some intensive brainstorming about future research into the disease. But this particular gathering, organized by the MIT Sloan School of Management and known as CanceRX, featured a novel twist: next to the oncologists, there were renowned economists such as Andrew Lo and Robert Merton. More unusual still, there were bankers and financiers too.