JPMorgan Joins Gates Foundation, Drugmakers in Fund

(Corrects second paragraph to show Canada, Germany and Children’s Investment Fund Foundation are among those contributing the $94 million.)

JPMorgan Chase & Co. (JPM) and the Bill & Melinda Gates Foundation formed an investment fund that will back late-stage development of technologies to fight killer diseases in low-income countries.

A group of investors including the Canadian and German governments and the Children’s Investment Fund Foundation committed $94 million to the fund. The International Finance Corp., GlaxoSmithKline Plc (GSK), Merck & Co. (MRK), Pfizer Inc. (PFE)’s foundation, Storebrand ASA (STB) and JPMorgan Chase also invested. The Global Health Investment Fund will tackle diseases including malaria, tuberculosis and HIV, as well as maternal and infant mortality, according to a statement.

The private financing seeks to address the fact that global health funding barely grew last year. The U.S. and other governments cut their aid to programs in developing nations by 4.4 percent, according to the Institute for Health Metrics and Evaluation.

“The Global Health Investment Fund demonstrates the potential for innovative collaborations and thoughtful financial structures to mobilize new sources of capital for social challenges,” said Jamie Dimon, chairman and chief executive officer of JPMorgan Chase. “This product brings a diverse group of investors together around the shared objective of developing life-saving technologies in a financially sustainable way.”

Given the risks of investing in the clinical development of new technologies, the Gates Foundation and the Swedish International Development Cooperation Agency will partially offset potential losses in the fund, which will seek a financial return for investors by targeting technologies with public health applications in both developed and emerging markets.

Lion’s Head Global Partners LLP, a London-based asset manager specializing in sustainable development, will be responsible for originating, managing and exiting the fund’s portfolio investments.

To contact the reporter on this story: Makiko Kitamura in London at mkitamura1@bloomberg.net

To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net

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