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About this author
Zack Lynch is author of The Neuro Revolution: How Brain Science Is Changing Our World (St. Martin's Press, July 2009).
He is the founder and executive director of the Neurotechnology Industry Organization (NIO) and co-founder of NeuroInsights. He serves on the advisory boards of the McGovern Institute for Brain Research at MIT, the Center for Neuroeconomic Studies, Science Progress, and SocialText, a social software company. Please send newsworthy items or feedback - to Zack Lynch.
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September 18, 2007

NASDAQ and NeuroInsights Launching Neurotech Index Sept. 25

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Posted by Zack Lynch

Huge news. Next Tuesday, the NASDAQ NeuroInsights Neurotech Index will go live (ticker symbol: NERV). It has been nearly five years since we came up with the concept for a public neurotech index to track the performance of the industry and now this vision is about to become a reality.
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Toni Clarke of Reuters breaks the news in her exclusive story Nasdaq picks brain for new health care index

BOSTON (Reuters) - Research and investment into brain-related illnesses is growing at an unprecedented rate as scientific advances coincide with the demands of an aging baby-boom population determined to beat the odds.

Now, investors looking to place bets on this fast-growing but highly specialized sector can.

Nasdaq Stock Market Inc is poised to launch an index made up of companies whose primary focus is the development of drugs, devices and diagnostics to treat neurological disorders, including Alzheimer's disease, Parkinson's disease and schizophrenia.

It is one of the first indexes ever to focus on a specific disease category, and Nasdaq expects it to interest several types of investors, from individuals touched by a particular disorder to those seeking to minimize the risk of stock-picking in a complicated industry.

"This index will be the defining metric for performance of companies in this very important segment of the health field," said Steven Bloom, senior vice president, Nasdaq Financial Products.

The index, to be called the Nasdaq NeuroInsights Neurotech Index, will launch on September 25 and has been created in conjunction with NeuroInsights, a research firm that monitors and analyzes trends in the neurotechnology field.

Companies in the 32-member index include drug makers such as Biogen Idec, which makes the multiple sclerosis drugs Avonex and Tysabri; device makers such as Northstar Neuroscience, which makes brain stimulation devices to help treat stroke and depression; and diagnostic companies such as Natus Medical. Together, they have a combined market value of more than $71 billion.

...To qualify for inclusion in the index, a company must be a "pure play" neurology company, deriving some 50 percent or more of its revenue from treatments for central nervous system disorders, or devoting 50 percent or more of its research and development dollars to the field.

According to a report by NeuroInsights, global sales of pharmaceuticals for neurological disorders grew 8.5 percent to $101 billion in 2006, compared to a 7 percent growth rate for the overall pharmaceuticals market.

And Zack Lynch, co-author of the report, said venture capitalists are plowing money into the field, with investment rising 7.5 percent in 2006 to $1.67 billion.

"The aging of the baby-boom generation is creating a substantial market opportunity," he said.

More neurotech index news to follow as we launch the index with a host a brain industry CEO media tour in NYC next week. Click to read full Reuters article.

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