JDRF, PureTech Try Nonprofit Ownership To Fill Funding Gap

Call it venture philanthropy with a twist: if all goes to plan, the Juvenile Diabetes Research Foundation will co-own a series of biotech companies dedicated to type 1 diabetes treatments without violating tax code, thanks to a structure created by Boston’s PureTech Ventures.

As venture firms flee early stage risk and big drug companies slash research budgets, nonprofit disease foundations have tried to help turn biomedical discoveries into products, pitching in for industry research programs and drug trials. Now there’s a new twist: the high-profile and well-funded Juvenile Diabetes Research Foundation wants to build new companies.

The New York-based foundation is putting up to $5 million into ownership of a holding company dubbed T1D Innovations that...

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