Bill Gates pledges $4 billion for third-world medicines

Vaccines are not unlike software: They require a big investment up front, but then they're cheap to make.

Published December 14, 1999 5:00PM (EST)

In February 1998, as Microsoft founder Bill Gates was began to plot how to unload some of his billions on charitable causes, his dad met with Dr. Gordon Perkin, who headed a Seattle-based health charity and knew from his contacts in the World Health Organization that many vaccines weren't getting to the children they could help the most -- kids in the third world.

"I brought the vaccine gap to the attention of Bill Gates Sr. Children in poor countries don't get shots we take for granted here," Perkin says. "And he said 'I think this would be something my son would be interested in.'"

Last month, Perkin's pitch to Gates culminated in a $750 million gift by the Bill and Melinda Gates Foundation to a global fund for children's vaccines. Last week, at a Seattle love fest with Nelson Mandela and his wife Graca Machel, Bill Gates Jr. said the vaccine fund would eventually top $4 billion.

Gates' gift could transform the world's health. It could save millions of lives. And it has thrilled infectious-disease specialists, who see the initiative as potential leverage to prod states and drug companies into action against the microbial ills of the tropics.

"It's a remarkably generous offer," says Dr. Carole Heilman, director of the microbiology and infectious disease division at the National Institutes of Health.

Currently, the entire pharmaceutical industry earns only about $240 million per year from vaccine sales intended for poor countries -- a fraction of what Eli Lilly earns from Prozac. The global fund that the Gates money helped create is expected to spend an additional $200 million a year for childhood vaccines in the third world.

Gates had already committed major funds for vaccine research, including $100 million for the development of an AIDS vaccine, a gift that dwarfs the estimatted $50 million that goes into AIDS vaccine product development each year.

"His gifts have completely revitalized the field," says Dr. Seth Berkley, president of the International Aids Vaccine Initiative, which has received $26.5 million from Gates. Not all AIDS vaccine specialists are as ebullient about Gates as is Berkley, but they all appreciate the help. AIDS killed an estimated 2.3 million people last year, the majority in sub-Saharan Africa.

A key question is the extent to which Gates' vaccine gifts will help create a market that stimulates the pharmaceutical industry to develop and produce vaccines for diseases like malaria and tuberculosis, which together killed 3 million people last year.

"What we've heard from industry is that implementation needs to occur for them to feel that it's worth pursuing other vaccines," says Heilman. By implementation she means the developing countries need to be able to buy vaccines at a price the drug companies can live with.

The drug industry has shown no great interest in remedies for third-world ailments. Of the 1,233 drugs licensed between 1975 and 1997, according to one report, only 13 were for tropical diseases -- and only four of those were developed by the pharmaceutical industry.

UNICEF and the Pan American Health Organization currently are the main purchasers of vaccines for the third world, but they don't have unlimited budgets. As a result, new vaccines take years to reach most third-world children. Vaccines against hepatitis B and meningitis, in use since the 1980s in the West, are infrequently used in Africa though they could save thousands of lives there.

Recently, a pair of Harvard economists, Jeffrey Sachs and Michael Kremer, proposed the creation of what amounts to multibillion-dollar prizes, contributed by governments and charities, for drug companies that deliver safe and effective vaccines for maladies plaguing the developing world. The idea is that while research money helps, the only true incentive for the drug companies is to have a full-price market for their products.

"The Gates initiative will hopefully achieve two goals," says Kremer. "One is to get the existing vaccines out to people who need them. The second is to convince these companies there will be a market if they develop vaccines for malaria or TB or African strains of HIV."

Africans have benefited little from the new AIDS drug cocktails, which cost about $15,000 per patient per year. Nor is it certain that the AIDS vaccines currently in clinical research trials -- few enough as it is -- would work on African strains of the disease even if they work on strains common in the United States and Asia.

Tuberculosis, which kills nearly 2 million people each year in the third world, languished as a research backwater for years until resistant strains of the bacteria appeared in U.S. hospitals. It still gets only about $60 million a year from the NIH compared to billions for cancer research.

Although the genome of the tuberculosis bacterium was recently sequenced, offering a juicy target for research, the pharmaceutical industry has shown little interest in developing a vaccine.

But Gates recently gave a new foundation headed by microbiologist Carol Nacy $25 million to develop effective drugs and vaccines for TB. The seed money could get the pharmaceutical industry interested. "To the extent that funding from the Gates Foundation increases incentives to tackle problems, it's got to help," says Ann Ginsberg, chief of the NIH's tuberculosis branch.

Gordon Perkin now directs the foundation's global health program, which has begun raiding universities and the NIH for talent. Regina Rabinovich, a senior administrator at the National Institute of Allergy and Infectious Diseases, was recently hired to head the foundation's malaria vaccine program.

Biotechnology, particularly its computer-enhanced, digitized forms such as the effort to decode the human genome, has long fascinated Gates. "Bill is almost as excited about biotech as he is about information technology," says Trevor Neilson, spokesman for the Gates Foundation.

In 1996, Gates enticed brainiac Leroy Hood, whose automated DNA-cloning machines made the Human Genome Project possible, to leave the California Institute of Technology to head the University of Washington's biotechnology department. UC-Berkeley geneticist Mary-Claire King, who did groundbreaking work on breast cancer, followed shortly after. (Gates' mother died of breast cancer in 1994.)

Vaccines are especially interesting to Gates, his associates say, because they can offer the kind of push-button public-health fix that appeals to technology wizards. But then, what software maker wouldn't appreciate a killer app to fight viruses?

"Gates understands technology, and vaccines are the best preventive-health technology," says Berkley. "In a lot of ways it's similar to making software. You invest a lot of money up front but once you have it, it can be produced cheaply."

Which is why the much-maligned Bill Gates, fresh from his whipping in Washington, could sit at a forum in Seattle last week and bask in the praises of Nelson Mandela, the Nobel laureate freedom fighter. "As long as we have men and women of this caliber," Mandela said, "our country, the world, is safe, and we are going to continue making progress whatever the problems."

By Arthur Allen

Arthur Allen writes on health, science and other issues for Salon. He lives in Washington.

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