Venture capitalists pumped nearly $1.7 billion into neurotechnology in 2006, according to a report released today that paints the field as a frontier industry on the rise. Designed to help investors quantify opportunities in this growing area of medicine, the report by San Francisco consulting firm NeuroInsights focuses on the more than 500 public and private companies working on technologies to treat brain and central nervous system disorders. In addition to the 7.5% rise in venture capital funding, The Neurotechnology Industry 2007 Report: Drugs, Devices and Diagnostics for the Brain and Nervous System unveils the following findings:
-Brain-related illnesses afflict more than two billion people worldwide
-The worldwide economic burden of neurological disorders has reached more than $2 trillion per year, with roughly half coming from the U.S.
-The Neurotech Index of publicly traded neurotechnology companies was up 53% from its December 31, 2003 conception to March 31, 2006, outpacing the Nasdaq Biotech Index, which gained 7% during the same period.
The report says that the majority of 2006 neurotech revenues — up 10% to $120.5 billion — came from pharmaceuticals, which accounted for $101 billion. Still, 2006 saw $15 billion in revenues from neurodiagnostics, and $4.5 billion from neurodevices. And as evidenced by the fact that the industry’s trade association, Neurotechnology Industry Organization (NIO), is less than one year old, it’s a field still in its infancy, with device and diagnostics companies taking on a leading role. Non-pharmaceutical firms account for almost half of NIO’s current membership, which is about 20-companies strong. Device and diagnostic members include: Adlyfe, Brain Resource Company, Cogmed, CNS Response, Cyberkinetics Neurotechnology Systems, EEG Spectrum International, NeuroPace and NeuroScience Associates.