Cancer Research Technology (CRT) - Cancer Research UK's commercial arm - and the European Investment Fund (EIF) have created a £50 million investment fund to bridge the funding gap in the UK between cancer drug discovery and early development.

The CRT Pioneer Fund "will seamlessly take potential cancer drugs from discovery through to entry to Phase II clinical trials. It is a bold step to fund the most innovative oncology research and to plug a large gap in the UK funding of drug discovery," say the partners.

CRT and the EIF will make equal contributions to the CRT Pioneer Fund, which has launched with a first close of £25 million. This may be doubled by the founders to reach the total £50 million, they note.

"This investment targets a stage of the investment spectrum often neglected by the market. The CRT Pioneer Fund will be capital-efficient and primarily follow a licensing model, rather than creating companies," said EIF chief executive Richard Pelly.

"Both Cancer Research UK and CRT are world leaders in discovering, developing and commercialising cancer treatments, for which there remains a high unmet need, and through their network are able to access excellent research. The EIF is therefore delighted to be partnering with CRT and this investment now becomes the largest technology transfer operation partnered by EIF to date," said Mr Pelly.

The government's Strategy for UK Life Sciences sets out "ambitious plans to build on the success of the industry by fostering collaboration between our excellent research base and businesses," and the  CRT/EIF initiative "will complement this work extremely well,” noted the Minister for Universities and Science, David Willetts. It will help to “take our world-leading science from the laboratory through to benefits for patients and the economy," he said.

At least two-thirds of the Fund will be used to develop discoveries made by Cancer Research UK scientists. This may include projects within CRT's Discovery Laboratories, the Institute of Cancer Research's Cancer Therapeutics Unit, Cancer Research UK's Paterson and Beatson Institutes, and Newcastle University. CRT will re-invest its share of any profits derived from the Fund in Cancer Research UK's work.

"This vital investment will nurture world-class innovation in drug development to bring potential new treatments to patients as quickly as possible," said Dr Harpal Kumar, chief executive of Cancer Research UK.

"Our scientists and doctors have contributed to most of the world's top cancer drugs, such as temozolomide, used worldwide to treat people with the most aggressive type of brain tumour. And through our research, we've contributed to the discovery or development of nearly 50 drugs now being tested in clinical trials. These drugs could also save many thousands of lives in the future," he said.

"This new CRT Pioneer Fund will enable us to build on the progress already made and provide a stepping-stone to producing the cancer drugs of the future," Dr Kumar added.

The BioIndustry Association (BIA) has welcomed the CRT Pioneer Fund, noting that it "will provide another financing option for companies and academics in the UK looking to translate their cancer drug discoveries into clinical development."

"The Fund arrives at a particularly good time for life sciences in the UK, following the launch last week by the Wellcome Trust of a £200 million venture fund and GlaxoSmithKline's decision to invest £500 million in biopharmaceutical manufacturing in the UK," said BIA interim chief executive Glyn Edwards.

"These actions by charitable foundations and companies are to be applauded, and provide a launchpad from which government could further stimulate private investment into medical research," said Mr Edwards.