Gates Foundation Health Chief on Coaxing Pharma to Do Good (Part 2)

11/26/13Follow @xconomy

Yesterday, I ran the first installment of an interview with Trevor Mundel, the president of global health at the Seattle-based Bill & Melinda Gates Foundation. He talked about his personal reasons for leaving the pharmaceutical industry to work on global health problems, and how the foundation makes decisions on how to spend its money.

Today, Mundel is talking more about how the foundation interacts with pharma and biotech companies. He shares some lessons learned here that I think could be useful for every patient advocacy group that wants to see the industry do bigger, and better things for patients.

Xconomy: I want to ask about the biotech industry and how you interact with them. You know a lot of these folks and have interacted with them in your past life. I asked your predecessor, Tachi Yamada, a couple years ago about this, and he thought pharma was doing a pretty good job of engaging with the foundation. How would you say pharma and biotech are doing in terms of working with you on these problems?

Trevor Mundel: When I came in, I think we had a strong emphasis on pharma. I’d say we have developed that even further since Tachi left. We’ve had some significant events. The London conference was a huge highlight for the pharma group. The CEO roundtable that we do with Bill (Gates) and the pharma executives is an oversubscribed and enormously popular event. It has led to a lot of buy-in, and very strong top-down endorsement of what we do.

Trevor Mundel, president of global health at the Bill & Melinda Gates Foundation.

Trevor Mundel, president of global health at the Bill & Melinda Gates Foundation.

What I found is that within companies, you need to reach down a bit deeper than just the CEO. The CEO can be hugely supportive, but our teams engage deeper in those organizations. Critical people are often the heads of R&D. So I’ve been doing quite a bit of work with the heads of R&D. It’s quite effective. If you can get the CEO on board, and the head of R&D at the pharma company on board, then you’ve really got things locked down. If you just have the CEO, then things can take a long time when our teams try to engage deep within those organizations. But I’d say pharma is an important partner for us.

What we need to be clear about, though, is what each of the partners gets. A lot of our partners like to engage from a CSR (corporate social responsibility) perspective, in global health. I think it’s very positive for pharma companies to be engaged with us. We also determine we get value from the interaction as well. We bring a lot to the table, whether it be this [global burden of disease report]—which is helpful to them too, because it’s worldwide. To the extent we are hugely subsidizing that, they derive value from it, too. They derive value from our work to improve regulatory systems in developing countries. We work with the FDA and the EMA quite closely on this. It’s driving thinking on the global regulatory structure. Many things that we do give them value.

X: More than just PR?

TM: Yes, more than just PR. We expect really deep commitments. We don’t want a sort of ‘storefront’ team on a project. If you’re going to do drug discovery in malaria, don’t put three people on the team. We want a fully powered team, and a real partner. We want to access the deep capabilities. That kind of relationship has matured with a number of pharma companies, but not all of them.

X: What about biotech? Biotech and venture capital seem to be missing in action here.

TM: Yes, I did find they were missing in action. We already had some ideas around PRIs (program-related investments). They aren’t something new. We’ve been doing developing country vaccine manufacturing loans. We have volume commitments, and AMC (advanced market commitments) to give preferential pricing, either in volume guarantees or post-market commitments. It’s so we can lock in affordable prices.

X: You’re correcting a market failure, and giving them an incentive to develop these things.

TM: Exactly.

X: That was going on before you got here.

TM: Yes, that was going on. But as I was coming on, we did the Liquidia Technologies deal. (The first Gates Foundation equity investment in a biotech).

X: Why have you personally shown interest in going that route, through equity investments in biotech companies?

TM: I love the energy and the drive of biotech. I’ve seen it … Next Page »

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  • the_caganer

    Bill Gates did more good as profit seeking highly competitive business man than he has philanthropist. Without Bill Gates would India have an IT sector? or China? Probably. would it have come later probably. How much good was done by people and corporation using his software? He helped lift millions (if not billions) out of desperate poverty. His charity is work is nice, but he has not accomplished anything close to the good he created as a business man. Pharma does good everyday, people live longer, healthier lives thanks to pharma, this idiot needs to shut up.

    • http://myindigolives.wordpress.com/ Ellie K

      The guy who just started as president for global health at Bill Gates’ Foundation seemed okay, although I don’t understand why they’re reinventing the wheel. Why not get up-to-speed on what WHO or other public experts, epidemiologists AND clinicians who work in the field, have been doing for decades. Goals and constraints aren’t identical, but the Gates staff must be familiar with established best practices! Maybe they are.

      Still, I kind of agree with what you said. I wish Bill Gates would go back to Microsoft, do what he did so well. He looks so young, that one can forget that he isn’t really. The title of this series REALLY leaves a lot to be desired! “Gates Foundation Health Chief on Coaxing Pharma to Do Good”. The author @ldtimmerman apparently believes that the past 50 to 100 years of pharmaceutical research hasn’t been helpful. I’ve never read an article titled, “X Foundation chief coaxes investment bankers to do good”, nor would I expect to. Maybe “war lords” or “organized crime” would be a better fit. The intent of pharma is ONLY to do good. It is ignorant to believe that the Gates Foundation must coax pharma into doing so, else pharma would do “bad”? Again, this wasn’t Bill Gates’ bias, as the new manager says, and repeats twice for emphasis, that Gates Foundation spends $600 million per year on new drug research while pharma spends $13 billion per year. Also, he acknowledges that it isn’t a good fit for VC’s who want to take a stake, then make a quick profitable exit. Seems obvious, although the author perceives VC investment in developing world public health as…sigh, “correcting a market failure through incentivizing”. That is not always the right approach, especially not here.