Wellcome Trust’s bonds issue backs pioneering research
The blue skies look brilliant for Cambridge scientists at the genome campus at Hinxton, who stand to have years of cutting edge research underwritten thanks to an astute financial move by The Wellcome Trust.
The UK’s largest and the world’s second largest charitable foundation funding biomedical research, The Wellcome Trust has received an Aaa/AAA bond credit rating from Moody’s and Standard & Poor’s respectively, representing the highest credit rating available.
It is the first UK charity to have been awarded the Aaa/AAA rating. Barclays, JPMorgan Cazenove and Morgan Stanley have been mandated as joint bookrunners for a debut issuance of Sterling-denominated bonds.
These will be used for investments that, over the long term, will enable the Trust to fund a wide range of scientific and medical research with the ultimate aim of improving human health worldwide.
The Trust hopes to raise some £300m to £500m when it issues the 30-year bond in the UK.
The Wellcome Trust has already committed more than £300 million to expanding the genome campus at Hinxton and related facilities for world-leading scientists.
Its researchers at the Sanger Institute sequenced one-third of the human genome, one of the most important scientific breakthroughs in recent times. Scientists are currently using this data to identify the genes that increase the chances of developing major diseases such as cancer, diabetes and heart disease.
Trust-funded researchers are also working on:-
• The development of a new treatment for malaria – a Wellcome Trust study by Professor Nick White showed that artesunate drugs, derived from a Chinese herb, are more effective than quinine in the treatment of malaria, prompting the World Health Organisation to change its recommendations for the treatment of malaria.
• Pioneering cognitive behavioural therapies – Wellcome Trust-funded rese-archers have developed therapies addressing a wide range of psychological disorders from bulimia to post traumatic stress disorder.
• Establishing the UK Biobank – the Wellcome Trust is helping to fund UK Biobank, a project of unprecedented size. By collating lifestyle and medical information from 500 000 volunteers, researchers hope to identify environmental and genetic factors that cause common conditions such as cancer and heart disease.
The Trust holds £12.3 billion of investment assets, and spends over £450 million per year on research and other activities.
Danny Truell, chief investment officer at The Wellcome Trust said: “The Aaa/AAA rating will give us the financial flexibility to access additional long-term funding for the Trust.
“It will help us to continue to increase the amount of money we spend each year in support of the very best scientists whose discoveries will increase our knowledge about health and disease.”
The Wellcome Trust’s investment portfolio, which had £12.3bn in September 2005, has seen average returns of 9 per cent a year over the last decade, says rating agency Standard & Poor’s. Such strong returns mean it should not be hard for the trust to raise money.