Is Bill Gates threatening to dominate global health the way Microsoft once monstered the computer industry? Matthew Bishop and Michael Green weigh up the pros and cons.

So quipped a wag among the world’s top techies earlier this year when retired software billionaire Bill Gates opened a jar full of mosquitos during a presentation at the annual TED (Technology Entertainment and Design) conference in California.

Gates’s mosquito stunt was part of his campaign to rally support in the battle to end a million unnecessary deaths a year from malaria in the developing world. Having stepped down from Microsoft in the middle of 2008, Gates is now giving most of his time, as well as the $30bn or more that he has donated to the Bill & Melinda Gates Foundation, to doing good, with a particular focus on eradicating infectious diseases in the developing world. In doing so he has become the de facto leader of a remarkable new movement among rich business people who are dedicating their wealth and business skills to solving some of the world’s most intractable problems.

We call this new movement “philanthrocapitalism”. Our interviews with many philanthrocapitalists have convinced us that, despite the current economic crisis, they mean business and are becoming a genuine force for good. For rich people to play such a prominent role in tackling society’s problems makes many people uncomfortable – Gates’s generosity has made him a controversial figure to some veterans in the fields of global health and development. Nevertheless, we believe that it is crucial that everyone from governments to non-governmental organisations to multinational businesses finds a way to partner effectively with them, so that philanthrocapitalism can achieve its full potential. Gates’s campaign against malaria shows why.

The problem with malaria is clear, according to Gates. The vaccines and medicines to treat these ailments don’t exist simply because the people who suffer and die from them can’t afford to pay for them, and therefore no one invests in the research and development of these drugs. “How many people work on, say, brownie mix? How many people work on a soft drink?” he complains, to illustrate the point. “Go get 0.1% of the scientists working on erectile dysfunction to come and work on malaria and you will be making a huge contribution.”

The Bill & Melinda Gates Foundation (Gates stresses that his wife is an equal partner) is already starting to turn around the battle against malaria. One thing he brings from his business success is a belief that ambitious goals can be set and achieved. Malaria, for instance, used to be classified as a ‘neglected disease’ because of the lack of money going into research to find a vaccine or a cure. But last September, Malaria No More – a coalition of governments, multilateral agencies, NGOs, celebrities and companies, catalysed by the Gates Foundation – pledged $3bn to reduce deaths from malaria to near zero by 2015, from over one million a year now. Malaria neglected no more. 

Gates’s interest in global health issues goes back to 1993 when he was shocked to discover that millions of people were suffering from diseases that the world had the technology to prevent or cure. He started giving his money away and lobbying others so that, before long, he says, “People would see me at cocktail parties and wonder ‘is he going to come up and talk to me about TB?’ I was the Tuberculosis Guy.”

Since then Gates’s portfolio of investments in fighting killer diseases has diversified. But, talking to Gates, it soon becomes clear that, for all his vast wealth, he knows that he cannot achieve his ambitious goals on his own. “We’re a tiny, tiny little organisation”, he told us. As a result, he has become increasingly keen on leveraging governments to do more to tackle killer diseases. In 2000 he launched the Global Alliance for Vaccines and Immunisation (GAVI), supported with $750m of his own money, to boost aid spending to prevent deaths from communicable diseases. By getting children in developing countries vaccinated, GAVI claims to have already saved more than three million lives.

Yet Gates realised that by putting so much of his own money in up front he had let governments off the hook. So when he launched the Global Fund to Fight AIDS, Tuberculosis and Malaria in 2002, he made sure that his donation was contingent on others chipping in too. Catalysing partnerships, with governments and also non-profits, businesses and other philanthropists, is now a core part of the Gates strategy, to ensure that his bucks generate a real bang.

Billanthropy is not without its critics, however. Health professionals have repeatedly claimed that Gates’s interest in technological solutions focuses on particular diseases rather than building up the health systems of developing countries. You may get the drugs, they argue, but without the doctors and nurses to administer them they are not going to do any good. Moreover, in running programmes to test and develop these drugs, donors such as the Gates Foundation are attracting skilled staff out of the already over-stretched health systems of poor countries, making matters even worse.

Patti Stonesifer, a Microsoft veteran and chief executive of the foundation until last year, acknowledges that the criticism has some validity. “We expected to concentrate on developing drugs and so on,” she says. “We were a bunch of product development-development people! We assumed that others would focus on getting the products out there.”

That was then. Gates has learned quickly that leaving it to others while they focus on technology is not an option. “My favourite book is Disease Control Priorities in Developing Countries,” he explains in a way that sounds all too plausible “because it really goes through the system – what should be done at primary care and what should be done at secondary... The last thing you want to do is make a vaccine and not have the refrigerators.”

Gates is also adamant that he ‘gets’ the need for health systems. “Just pure sanitation is a huge thing,” he explains. “If you look at the dramatic improvement in infant mortality in the United States, it’s not when antibiotics come along; it’s when toilets and tennis shoes come along.” The Gates Foundation was also a signatory to the International Health Partnership, a 2007 UK initiative to get aid donors to commit to support rather than undermine the health systems of developing countries. Nor is it just health care systems he is getting; healthier people need work to do, and the Gates Foundation is now rapidly increasing its spending on promoting economic development, not least by promoting a green revolution in Africa.

Gates’s relationship with the United Nations system, particularly the World Health Organisation (WHO), is also controversial. He doesn’t hide some of his frustrations with the UN system. “I don’t know every UN organisation yet,” he says, “though I think maybe in a few years I will.” A coalition of public health professionals used the 2008 report Global Health Watch 2 to criticise what they see as a tendency to bypass WHO, through mechanisms such as the Global Fund, and to reject the international consensus. Critics also worry about Gates’s legitimacy: when he is negotiating with governments, who chose him for this position of power? If he does the wrong thing, to whom is he accountable?

Being free from the constraints of working according to the rules is, for some, one of the great strengths, not weaknesses, of the Gates approach. Peter Piot, the former head of the UN agency leading the fight against HIV and AIDS, is a fan of the way that philanthropists such as Gates are willing to fund risky ‘crazy ideas’ that governments would not touch. “You need a coalition, a brilliant coalition, that will use the best skills of business and non-governmental organisations and community groups, as well as governments.”

Those words of praise for the role of philanthrocapitalists can also point to the most significant criticism of the Gates Foundation – that it has grown too big and too dominant in the global health sphere (much like Microsoft did in the personal computing business, mutter the critics). This was the line of attack taken by WHO’s then malaria czar, Arata Kochi, who argued that “a lot of money leads to monopoly, and discourages smaller rivals and intellectual competition”. According to Kochi and other critics, older foundations are being crowded out of the business because there’s no point in putting your money into a problem that is soon to be drowning in Gates’s dollars. No one can speak up against this new Gates ‘groupthink’, they say, because everyone has grown dependent on the his money.

This charge is hard to prove or disprove. Gates insists that he would welcome more competition in taking on malaria and other infectious diseases. He also points out that there are huge global public health issues that he is leaving to others, such as tackling the millions of needless deaths each year from smoking-related diseases (a fight that is being led by New York mayor and billionaire philanthrocapitalist Michael Bloomberg).

Even so, he admits that his influence on global health issues can “confuse” other participants in the field without his resources. “We need to be clear about what we want to take the lead on and where we are happy to be supportive.” He has given $105m to the University of Washington to provide independent analysis of all the work going on in global health, including that of his foundation.

Gates has also committed to writing an annual letter to explain what he is up to, and how the work is progressing. The first letter appeared in January, and called on governments to honour their pledges of increased international aid that they made at the G8 in 2005. It also criticised the government of Italy for cutting its aid budget. Personally, Gates is leading by example: he is increasing the foundation’s giving in 2009 by over 10% to $3.8bn – the most that any foundation has ever given in one year.

Gates is human – he, and his foundation staff, will make mistakes. We must hope that the University of Washington and others scrutinising his work will help him to pick up on these quickly and that he will admit where he has made errors. What he has achieved already is to inject not just new money, but new energy and ideas into the effort to prevent millions of unnecessary deaths. As even his critics from the Global Health Watch 2 freely acknowledge: “If ‘global health’ ten years ago was a moribund patient, the Gates Foundation today could be described as a transfusion of fresh blood that has helped revive the patient”.

Gates knows that he is taking on some huge challenges, compared to which his foundation is that “tiny, tiny little organisation”. But then again, there is an African proverb that “if you think you’re too small to make a difference, try sleeping in a room with a mosquito”. Perhaps that is the point he was making, to inspire some of the other Silicon Valley billionaires to make a contribution, when he released those mosquitoes in California in February.

Matthew Bishop and Michael Green are the authors of Philanthrocapitalism: How the rich can save the world and why we should let them.

They blog at: http://www.philanthrocapitalism.net