Foundation

Jan 26th 2005
From The Economist Global Agenda

The world’s richest charity confronts the health of the world’s poorest people

THREE-QUARTERS of a billion dollars is a lot of almost anybody’s money. Almost anybody, that is, except Bill Gates. Even for him it is scarcely small change. That, however, is the size of the donation announced this week by the foundation that bears his name and that of Melinda, his wife. The money is going to the Global Alliance for Vaccines and Immunisation (GAVI).

The Gates foundation is the richest charity in the world. Its endowment is worth $28 billion. Its annual income is that of a small country. And its founders are on a mission. The more modest parts of that mission are to improve America’s schools and libraries and to benefit Mr Gates’s native region of the Pacific Northwest (charity, after all, begins at home). The most ambitious part, though, is to free the world—and, in particular, those regions of it that are poor—of infectious diseases.

The donation to GAVI is merely the latest of a series of gifts intended to combat disease in the tropics. The foundation’s contributions have almost doubled global spending on research into malaria. They have formed the largest non-governmental gifts to the Global Fund to Fight AIDS, Tuberculosis and Malaria, which was set up at the prompting of Kofi Annan, the United Nations secretary-general, to combat those diseases. Independently of this, they have helped entire countries to set up anti-AIDS programmes. They have driven the creation of the Global HIV/AIDS Vaccine Enterprise, which, earlier this month, published a plan designed to pave the way to such a vaccine. And in a few months time they will begin to fuel the most ambitious project of all, an attempt to bulldoze 14 “roadblocks” which the foundation has identified as standing in the way of its medical objectives, and which it has dubbed its “Grand Challenges in Global Health” initiative.

This scale of spending could indeed transform tropical-disease research and treatment, as the Grand Challenges project intends. That is certainly the foundation’s aim—and it is a laudable one. But two risks come with it. One is that he who pays the piper calls the tune. With such a large amount of money at their disposal, the foundation’s scientists might end up, albeit unwittingly, controlling the research agenda in these areas.

The second risk is that other foundations—and governments, even—might feel that so much Gates money is flowing into global health that they can cut back on their own contributions. Then, ironically and unintentionally, the Gates foundation might end up with the sort of quasi-monopoly in its field that Microsoft, the source of Mr Gates’s wealth, enjoys in its.

Foundation and empire

With luck, neither of those things will come to pass. Patty Stonesifer, the foundation’s president, and Rick Klausner and Helene Gayle, its top scientists, are certainly aware of both risks. The first, of unintentionally calling the tune, is dealt with by what might be described as an auction of ideas. Though some money is simply given to good causes that approach the foundation, much of it, particularly that directed towards research, is awarded by open competition—as, for example, in the case of the Grand Challenges. The challenges themselves were the distilled wisdom of 1,000 ideas from the world’s scientists. Once they were announced, 1,500 suggestions for meeting them flooded in, and these have been refined into 400 formal proposals which are now being sifted through by a panel of independent scientists. As Dr Klausner puts it, “the idea is to stimulate the agenda, not create it.”

The risk of displacement is dealt with by an explicit understanding that the foundation will have no permanent pensioners. As its website rather inelegantly puts the matter, “Priority is given to projects that leverage additional support.” In this regard, GAVI is a good example. The Alliance (of disparate interested parties ranging from UN agencies to industry representatives), and its financing arm, the Vaccine Fund, were in essence created by the Gates foundation with an initial grant, also of $750m, in 1999. This was intended to last five years, and those years are now up—hence the new announcement. But the second $750m tranche is designed to last ten years, rather than five.

GAVI is being weaned. In its first five years its Gates money amounted to about half of its income, despite the fact that 11 national governments also chipped in. That got the alliance on its feet (see chart 1). But if it is to fulfil its objective of giving comprehensive vaccine protection to 90% of newly born children in the countries it serves by the end of those ten years, then it will need a lot more cash: some $8 billion-12 billion by its own estimates. That is way more than the Gates foundation wants to give, or, indeed, can afford. But the weaning strategy seems to be working. On Monday January 24th, Norway chipped in $290m, and on the 26th Britain followed suit with $1.8 billion, to be channelled to GAVI through a newly created International Finance Facility for Immunisation.

However, while it is true that part of the foundation’s strategy is not to monopolise the field, monopsonies—that is, dominant purchasers—are a different economic animal from a donor’s point of view. Creating a monopsony was certainly part of the motive behind GAVI. Childhood vaccination is a cost-effective way of saving lives, and one of the foundation’s precepts is, as it were, to buy lives cheaply: that way more people can be saved. But GAVI represents a way to do it more cheaply still. By creating a purchase fund that bundles together the requirements of the countries it serves (some 70 nations that have a GDP per head of less than $1,000), GAVI creates a large, reliable demand that stimulates more companies to get involved in manufacturing existing vaccines, provides an incentive to develop new ones, and pushes down unit prices.

Another way of buying lives cheaply is to make sure the money is neither wasted nor stolen. For this purpose GAVI, at the foundation’s instigation, has strict auditing procedures. So far, 41 countries have been audited. Of these, 25 passed and 16 failed. If a country’s vaccination programme is successful, it is rewarded. If a programme is seen to be failing, GAVI will work with that country to identify the problem and try to correct it. But if correction is impossible, funds will be cut off—as has already happened in the case of Kenya.

The principle of unity in diversity has also informed the foundation’s involvement in the Global HIV/AIDS Vaccine Enterprise. The purpose of that enterprise is to promote collaboration between funding bodies, such as the Gates foundation itself and the International AIDS Vaccine Initiative, and scientists, both academic and commercial. Such collaboration cannot, of course, be unconditional. Commercial scientists work for organisations that need to protect their intellectual property in order to make a profit. But by establishing agreed standards for testing putative vaccines, encouraging the maximum possible sharing of data, and planning how a vaccine might be manufactured in bulk and deployed, even before it is ready, the enterprise intends to speed the shining hour. The hope is that this sort of “industrialisation” of the discovery process will become a model for future research. Indeed, the foundation has already detected interest in a similar enterprise to discover and deploy a malaria vaccine.

The Global HIV/AIDS Vaccine Enterprise is a more speculative investment than the one in GAVI, since no one knows for sure that an AIDS vaccine can be developed. Nevertheless, AIDS is such a threat to world health, and also one of the biggest obstacles to economic development, that in this case speculation could bring a huge dividend.

In fact, combating AIDS already absorbs a third of the foundation’s spending on health care (see chart 2). Besides contributing to the Global Fund, the foundation is intimately involved in two large projects. Again, the targets have been carefully chosen. ACHAP, the African Comprehensive HIV/AIDS Partnerships, is Botswana’s anti-AIDS project. Botswana vies with Swaziland for the unenviable title of country with the highest HIV infection rate. According to UNAIDS, the UN agency responsible for combating the disease, almost 40% of Botswana’s adult population has the virus. With a population of 1.8m, it is small enough for the foundation to make a real difference.

Another country in which the foundation is taking a direct interest is India, where some 5m adults are already infected with HIV. Here, its Avahan programme, backed by $200m of foundation money, has concentrated on the country’s lorry drivers, a trade whose members had a large share of responsibility for spreading HIV in Africa. It has co-opted India’s main oil company and also its national truckers association to spread the message to drivers that they should take care not to spread the disease. It has also tackled the difficult task of making AIDS a topic of polite conversation by recruiting Raul Dravid, a prominent cricketer, to the cause.

Second foundation

The Grand Challenges initiative, though, may dwarf all this. Its scope is so ambitious that it is almost a foundation within a foundation (the actual administration is being done by America’s National Institutes of Health). The challenges in question range from the mundane (prepare vaccines that do not require refrigeration) to the esoteric (develop a genetic strategy to deplete or incapacitate a disease-transmitting insect population). The latter will involve both some serious genetic engineering and a public relations campaign designed to persuade people that it is safe and sensible to unleash engineered insects into the wild.

Nor are basic matters neglected. As David Fleming, the foundation’s Global Health Strategies director, points out, half of childhood deaths in the poor world have malnutrition as an underlying cause. So one of the challenges is “to create a full range of optimal, bioavailable nutrients in a single staple plant species”. More genetic engineering there, in all probability, or maybe a revolution in plant breeding techniques. So, if a new, healthy crop called Billgatesia graces your table one day, you will know who to thank.

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