"Funding for basic science and early-stage 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," says Prof. Lo. "This dearth in funding for translational medicine can be attributed to several factors, 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. Increasing risk and uncertainty inevitably leads to an outflow of capital as investors and other stakeholders seek more attractive opportunities in other industries. But it doesn't have to be this way."
Prof. Lo says that by applying financial techniques such as portfolio theory, securitization, and derivative securities to biomedical contexts, more efficient funding structures can be created to reduce financial risks, lower the cost of capital, and bring more life-saving therapies to patients faster.
Topics to be covered in Healthcare Finance will include: basic financial analysis for the life-sciences professional, the historical financial risks and returns of the biotech and pharmaceutical industries, the mechanics of biotech startup financing, capital budgeting for pharmaceutical companies, and applications of financial engineering in drug royalty investment companies, biomedical megafunds, drug approval swaps, and life sciences investment banking.
The course is open to both students from the MIT Sloan community and MIT life-sciences students who are interested in careers in the healthcare industry.
Meanwhile, FinTech Ventures, a popular project and lecture based course that explores different sub-industries within the FinTech space—including consumer finance, payments, trading and cryptocurrencies—has been designated as a full-semester course for Fall 2016. MIT Sloan first launched FinTech Ventures in Fall 2015 as a half-semester course. Co-teaching the course are Antoinette Schoar, the Michael M. Koerner (1949) Professor of Entrepreneurship and a Professor of Finance at MIT Sloan, and Visiting Associate Professor Matthew Rhodes-Kropf.
MIT Sloan was the first business school to launch a graduate-level course covering financial technology applications in the United States. The course was initiated by the Martin Trust Center for MIT Entrepreneurship and the Finance Group at the MIT Sloan School of Management, in collaboration with the MIT Department of Electrical Engineering and Computer Science and Harvard Law School.
Student teams comprised of business, engineering/computer science, and law students form early in the course and work together to write a business plan throughout the remainder of the semester. The course will feature lectures by MIT Sloan Finance faculty and entrepreneurs and investors in the FinTech area.
Enrolled students will be asked to develop business plans for their own FinTech ideas in teams that will be eligible to compete in a new MIT FinTech Competition. Last year's winning team has already received venture funding.
"FinTech Ventures combines technical knowledge with practical implementation of ideas," says Prof. Schoar. We have found that an interdisciplinary approach creates great motivation for students to dive deeply into the material and explore the industry from a number of different perspectives such as understanding business models, industry dynamics, the incentives of all the players in the industry, and regulatory structure."
The MIT Sloan School of Management is where smart, independent leaders come together to solve problems, create new organizations, and improve the world. Learn more at mitsloan.mit.edu
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SOURCE MIT Sloan School of Management