Wall Street Journal - June 27, 2006
Sally Beatty, sally.beatty@wsj.com; Marilyn Chase; marilyn.chase@wsj.com and Gautam Naik, gautam.naik@wsj.com

As the Bill & Melinda Gates Foundation prepares to roughly double in size in coming years with a massive contribution from Warren Buffett, will its financial firepower and entrepreneurial approach change the course of global health care, and even society? Or will its size work against it, sucking oxygen from other efforts and attracting critics at every turn?

The Gates Foundation will receive only a small portion of Berkshire Hathaway Inc. Chairman Mr. Buffett's $30.7 billion gift this year. But the charity is already the world's largest philanthropic organization with a $30.6 billion endowment. Since its founding in 1994 it has built a track record in targeting the world's three biggest killers -- AIDS, tuberculosis and malaria -- among other major scourges, and funding programs in prevention, diagnosis and treatment using existing tests, drugs and vaccines. Last year, the Gates Foundation spent $1.36 billion -- already, approaching the World Health Organization's budget for 2006 of $1.66 billion.

FOR THE GREATER GOOD

In a joint appearance with Mr. Buffett in New York yesterday, Mr. and Mrs. Gates emphasized that their goal is to work collaboratively with other foundations and government agencies. The foundation regularly invites experts from the WHO to brainstorming sessions in Seattle, and has hired experts from the Centers for Disease Control and Prevention and nonprofit groups. Melinda Gates pointed out the Gates Foundation already works with foundations like those of Michael and Susan Dell, Eli Broad, David and Lucille Packard, and the Rockefellers on areas including high-school education and agricultural biotechnology.

Richard Feachem, executive director of the Global Fund to Fight AIDS, Tuberculosis and Malaria, an independent Swiss-based foundation, says the Gates Foundation hasn't tried to compete with or replace traditional donors like governments. Instead, he says, it has used its money to make "strategic investments" with partners for new initiatives like disease-treatment programs and vaccine-development projects that work with initiatives from other funding bodies like the Global Fund.

For example, he says, the Gates Foundation has invested heavily in a HIV/AIDS testing and treatment program in Botswana. He says that is creating "a model that other countries can follow with Global Fund financing."

Many nonprofit officials say they expect the Buffett gift to inspire generosity in other donors, but some worry that could pose challenges by shifting responsibility away from government and onto the private sector. "There could be lawmakers who will look at these wealthy donors and say, 'You solve the problem, rather than us,' " says Diana Aviv, president and chief executive of Independent Sector, a nonprofit group that represents foundations, charities and corporate-giving programs.

The gift promises to give more attention to the Gates Foundation's two main focuses, education and global health, and potentially divert donor dollars away from other causes. The arts, for example, is not a big part of the Gates Foundation agenda, and that could make it harder for cultural institutions to call attention to their needs. "We're not against culture," said Bill Gates Sr., who serves as co-chairman of the Gates Foundations. "We just can't do everything."

The younger Mr. Gates said at the news conference he hopes the foundation's enlarged endowment won't discourage other givers but draw them in. "There will continue to be foundations of all sizes," he said. "If you want to deal with billions of people, you need scale." He said he's optimistic that the Buffett gift will spark more of the nation's superrich to become donors while they are still alive. "I hope we're seeing a rise in philanthropy and that people with wealth will give wealth back and give it back at a younger age," he said. "Ted Turner started it all by scolding people. We're trying to complement that by showing how much fun it can be."

In assuming the role as one of the biggest funders of global health programs, the Gates Foundation has taken an approach long eschewed by pharmaceutical companies and groups like the WHO: to use cutting-edge science to develop drugs and vaccines against diseases that kill millions in the developing world.

Some long-established foundations and international health officials initially worried that Mr. Gates would charge into philanthropy like a bull in a china shop, but some of that fear has abated. Some smirked at his initial hard-landing in places like India, where he quoted dire projections for geometric AIDS growth and ruffled government feathers. But his diplomatic skills have grown since then, along with the foundation's credibility for working with local project managers in countries from India to Mozambique. He also showcases his wife, whose modest demeanor has won over new friends for the foundation.

"I've heard both him and his wife speak," said David L. Heymann, who heads polio programs for the WHO. "They are both keen listeners. They ask the right questions. It's a pleasure to hear the right questions." He gave high marks to certain African malaria projects, that, instead of a single intervention, offer a whole panoply of services from bed nets and spraying, to diagnosis, and treatment. "It's a superb program leaving behind a public-health good."

Government officials say the Gates Foundation is not duplicating the work of public agencies. "They are really apples and oranges," said Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases. (Dr. Fauci's institute is involved in some projects with the Gates Foundation.) "The natural question is not, 'Why do we need WHO?' " he said. "WHO has never been one to put a lot of money into things. They are a coordinating, bully-pulpit kind of organization, and the need for that doesn't change."

The Gates approach has been much more grass-roots. A foundation initiative, known as Grand Challenges in Global Health, was modeled after a public call by a German mathematician in 1900, who challenged his fellow mathematicians to solve a list of the 23 greatest then-unsolved math problems. Similarly, at the Gates Foundation's behest, a group of scientists in 2003 picked 14 such challenges in global health from scores of ideas submitted from around the world.

Since its inception, the Gates foundation has bankrolled scores of causes, from an effort to reduce the devastating impact of sleeping sickness in Africa to the challenging quest to come up with a vaccine for HIV. Indeed, people familiar with the situation said last week that the foundation is readying a grant infusion of more than a quarter-billion dollars to the Global HIV Vaccine Enterprise, a collaborative quest it helped start several years ago. While it has left the actual implementation of global health programs to traditional agencies such as the WHO, it has tried to use its deep pockets to plug a funding gap in global health that many argue ought to be more generously filled by rich nations.

In addition, Mr. Gates yesterday highlighted a new area of interest: microcredit. Helping women start small businesses, save money for their families and preserve their funds after their husbands die will increase family security. Another area is agricultural biotechnology, which is important to food security and dovetails with health goals.

Mrs. Gates said that while touring Africa, she saw people standing in line for their AIDS and TB medications, yet unable to stomach the drugs because their stomachs were empty. "People in line can't swallow it if they don't have at least a banana and some water," she says.

Some question whether the Gateses' largess is being put to the best possible use in tackling global health. Few in the public-health field have dared to criticize the foundation since they are -- or hope to be -- recipients of Gates-sponsored grants. Yet some argue that instead of taking a narrow approach that aims to, say, reduce the number of HIV infections, the Gates Foundation could use more of its money to transform the politics of global health -- and thereby create a more lasting, widespread impact. In other words: Get rich countries to pour more money and take a stronger stand in the battle against the deadliest diseases of the developing world.

Amir Attaran, professor of law and medicine at the University of Ottawa in Canada, said the Gates Foundation has been generous in agreeing to spend $750 million over five years to boost childhood immunization in poor countries. However, he argued, "a more entrepreneurial approach would be to spend $50 million to change the policy environment" that contributed to the problem in the first place.

###

--Steve Stecklow and Mark Schoofs contributed to this article.

060627
WJ060602

Copyright © 2006 - The Wall Street Journal. Reproduction of this article (other than one copy for personal reference) must be cleared through the WSJ Permissions Desk.

Always watch for outdated information. This article first appeared in 2006. This material is designed to support, not replace, the relationship that exists between you and your doctor.

AEGiS presents published material, reprinted with permission and neither endorses nor opposes any material. All information contained on this website, including information relating to health conditions, products, and treatments, is for informational purposes only. It is often presented in summary or aggregate form. It is not meant to be a substitute for the advice provided by your own physician or other medical professionals. Always discuss treatment options with a doctor who specializes in treating HIV.

Copyright ©1980, 2006. AEGiS. All materials appearing on AEGiS are protected by copyright as a collective work or compilation under U.S. copyright and other laws and are the property of AEGiS, or the party credited as the provider of the content. .