MAPS and Vine Ventures Announce $70m Investment Vehicle

At the close of Thursday’s Business Forum here at Horizons, Vine Ventures’ Ryan Zurrer announced The Regenerative Financing Vine, a $70m Special Purpose Vehicle (SPV) that intends to fund patient access infrastructure and research for MAPS’ MDMA-assisted therapy (MDMA-AT) for PTSD.

According to details released by MAPS and Vine Ventures (who have pledged a minimum of $13m to the SPV), this model “fully maintains both MAPS’ nonprofit mission and governance and MAPS Public Benefit Corporation’s (MAPS PBC) public benefit drug development and post-approval activities.”

Thus far, MAPS’ research has been funded via $130m in philanthropic donations over its 35-year history. This SPV represents a shift away from this donation-only approach, funding the next stretch of MAPS MDMA-AT for PTSD work via an investment vehicle.

Speaking to Lucid News, Doblin expressed feeling, “in some ways a sense of massive failure in that I hoped we would have this bridge to sustainability come through philanthropy.” But, as more for-profit entities have entered the space – no doubt benefitting from and to some extent relying on the clinical, political and cultural work that MAPS has trailblazed in the field – many former-donors are now asking themselves “Why should I donate? Let me just invest,” explained Doblin.

Doblin’s preference for donations over investment is, according to the founder, related to his broader plans to focus on “mass mental health.” This might include providing MDMA-AT to places around the world where “there’s a lot of trauma,” and he worries that having to return money to investors might change decision-making around the loftier goals.

Details on the SPV:

• Target size: $70m.
• The SPV receives 6.1% of North America MDMA revenue for 7 years following initial drug sales.
• ‘Reciprocity payment mechanism’: after paying back the principal, the SPV returns 15% of the revenue share back to MAPS. After hitting a 3x payback, the SPV returns 50% of the revenue share back to MAPS.
• Vine will not take any carry or fees on the SPV.
• Investors can share their details with Vine Ventures here.

This is somewhat akin to project financing: i.e., investments are structured and appraised on the basis of projected future cash flows, as opposed to the current balance sheet of the project’s sponsors. Investors do not gain equity in MAPS PBC, but rather a share of future revenues, as explained above. See McKinsey’s New frontiers in pharma R&D investment (PDF) for more on these types of model.

This $70m represents a portion of MAPS’ $150m fundraising target for the next three years. MAPS will hope to raise the remainder through non-investment means, such as via philanthropy but also partnerships and joint ventures.

Recommended reading: Lucid News spoke with Doblin shortly after the announcement. Read the interview here, where Doblin shares his thoughts on the new funding model, some further specifics on the mechanisms baked-in to the SPV, the uses of the funds, and more.