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Gates finds controversy even in works of charity
Andrew Jack
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June 20, 2008

The article appeared in Financial Times on June 12, 2006.

Ten years after Bill Gates, the world's richest man, laid the groundwork for what has become the world's largest charity, construction is shortly to begin in Seattle on a headquarters designed to put his organisation on the map for decades to come.

With assets of $35bn (�19bn, �28bn), the Bill & Melinda Gates Foundation dispenses annual grants of $1.4bn. Its staff of 250 may soon double.

Its operations have enhanced Mr Gates's image even as Microsoft's corporate reputation has taken a battering. Yet the approach of the foundation is also giving rise to a level of concern and criticism that risks dulling his philanthropic halo.

Few belittle the foundation's generous and innovative support. It has proved pioneering in computerising libraries and funding education reform in the US. Above all, it has stimulated research into global health, bringing attention and resources to killer diseases such as malaria and tuberculosis, long neglected by researchers and drug companies because they are concentrated in the developing world.

But financial abundance can also be a curse. An organisation of its size will inevitably encounter criticism of its approach, particularly in such a sensitive field. Indeed, comments in the foundation's latest annual report, published this month, point to changes that would prepare it for its next stage of development.

Yet some questions are unlikely to go away. They have broad implications for governments, researchers and intended beneficiaries.

The first criticism is the speed and effectiveness of grant-making. "Gates has brought a corporate spirit that was perhaps needed into an old-fashioned area, but his funding has been more about public relations than choosing the best scientific options," says Pierre Druilhe, a specialist on malaria at the Pasteur Institute in Paris, whose application for support on vaccine development was rejected.

He describes decision-making as opaque and says some scientists have been willing to compromise on what they believe is best in order to receive funding. Others have been frustrated by rejections for reasons that are unclear or by a cumbersome approval process.

A second issue, which comes down to an ethical choice, is the drift away from an initial focus on "saving lives now" through programmes such as the Global Alliance on Vaccines and Immunisation, which boost the take-up in the developing world of vaccines already widely used in richer countries. Its attention has shifted towards early-stage science to develop drugs and vaccines that, if successful, would save future lives.

That was the contribution of Rick Klausner, the former head of the US National Cancer Institute, who ran the foundation's global health programme between 2002 and 2005. It culminated in $450m in "grand challenges" grants to scientists unveiled last year.

A third concern is that even if new drugs are developed, they offer "technology in a vacuum" that fails to recognise the political, logistical and managerial difficulties in getting them to the people in the poorer regions of the world who most need them. One recipient of foundation grants to develop drugs says: "Until recently, their staff took the view, 'fix the technology and the people will come'."

Alan Fenwick, a professor at Imperial College in London, is among those who stress that many of the world's most neglected diseases, such as lymphatic filariasis and schistosomiasis, two parasitic ailments, do not need innovation but simply modest funding and a little imagination in order to distribute drugs to those in need. Such work is where Mr Gates's business acumen as well as cash could provide a solution.

On all three issues, the foundation is adapting. In its annual report Patty Stonesifer, chief executive, describes plans for a reinforced system of advisers and more streamlined decision-making. Most importantly, the practical commercial experience brought by Tachi Yamada, the former head of research and development at GlaxoSmithKline [Get Quote] who this month replaces Mr Klausner, points to a renewed focus on how to deliver drugs to those who need them.

There is also fresh support for programmes, such as those championed by Prof Fenwick, that focus on the greater uptake of existing drugs; on fighting malaria in Africa; and on funding global development, including micro-finance and improved agricultural productivity. These indicate a recognition of the need to tackle obstacles to health and improved lives beyond just medical developments.

That leaves a number of broader tasks for the foundation to secure its legacy. The first is sustainability. Mr Gates' funding has kick-started drug development partnerships such as the Medicines for Malaria Venture and the Aeras global tuberculosis vaccine initiative, which channel the foundation's support to companies, academics and in-house research. But in the next few years, as the drugs and vaccines it backs move from laboratories into clinical trials in humans, the escalating costs risk exceeding even Mr Gates's ability to fund them. For now, he has raised expectations among researchers and patients but managed to garner only limited willingness by others -- whether fellow-philanthropists or governments -- to join him.

One explanation is also the second challenge for the foundation. By making global health its primary cause, it risks monopolising the issue. Donors may think Mr Gates has the resources to fund his causes, while other philanthropists might prefer to put their money into areas they can "claim" as their own.

Through recruitment and grants Mr Gates also risks unwittingly stifling debate among specialists who become reluctant to criticise his approach as they spend or compete for his money.

Mr Gates can do as he wishes with his cash, and his philanthropy has already made a remarkable contribution to global health. But he is finding that spending money most effectively can be even harder than earning it.

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