The AAAS annual meeting took place last last week in San Francisco, and Larry Page was scheduled to be a plenary speaker on Saturday night. Having given my own talk at the conference Saturday, I stuck around afterwards to hear Page’s. It turned out that Page switched places with the plenary speaker scheduled for the night before, and I ended up seeing Nobel prize winning physicist Steven Chu instead. Too bad, because Page apparently talked about the need for academics to market their work and for academia to pursue entrepreneurism, something that is of interest to this blog and that I’ve posted about before (blog posts from others on the talk can be found here and here). Chu’s talk, however, was probably more interesting than Larry’s.
Chu directs the Lawrence Berkeley National Laboratory and spoke about global energy resources, agricultural development, and world health. One part of his talk that I found particularly interesting was his discussion of a chemical engineering professor at UC Berkeley, Jay Keasling, who has discovered a way to get bacteria to become mini-factories for the creation of a malaria vaccine. His work, which I’m going to guess was being funded by the NIH, got the attention of the Bill&Melinda Gates Foundation who subsequently donated $43 million to develop his technique on a mass scale so that his treatment could be distributed cheaply and efficiently around the world.
One stipulation of this funding was that the malaria treatment would have to be sold at no profit for the developing company. But, the company could use whatever technology and inventions it did create during the development of the malaria treatment for other profitable purposes. The first not-for-profit biotech company was created with the Gates funding and this company was given a mandate to increase the volume of this treatment by a factor of a million (or so) and reduce the price of the treatment down to 20 cents a dose (or so), which they did—astonishing, given the price of newly developed drugs these days. And, the company created technology that it believes will spur other drug developments and, of course, create a profit for the company’s continued existence.
This is a unique example of integrating academic research with entrepreneurship, something that Larry Page had promoted the night before. In the absence of the Gates Foundation’s initiative, Prof Keasling would likely have received more government funding at a considerably lower amount than the Gates offering, and the development of a cheap malaria treatment available on a large scale would have taken years longer to get to those who need it. Proposing to fund R&D only if the resulting product is sold at cost while allowing profit from any collateral development is a great funding model—one that the NIH’s Small Business Funding Opportunities program should consider. It solves the problem of jointly satisfying the desire to make inventions from government-funded grants as widely accessible as possible while providing startup companies the opportunity to profit from their efforts in productizing the grant-funded technology. University professors want their ideas to be “free to the world”, while companies need to make a profit on the ideas that they bring to market in order for the company to survive (and have the ability to bring more ideas to the market in the future). This does both.
I also like the hutspah of the Gates Foundation to simply come in, tell a researcher to “Make it happen”, and give them the resources to do so. No screwing around with the slow slog of writing grants, getting them reviewed, possibly further rounds of submissions, then finally training graduate students to do the research. Much of the $30 billion spent by the NIH to fund academic research is done so with the intention that the research will benefit the general public whose tax dollars pay for it. Certainly, grant proposals often proclaim the potential benefit of the research to the general public right up front (in my field, many grants begin by stating that the US has 30 million hearing impaired people and that their research will help develop better hearing aids). Most of this research ends with a published paper as the only resulting final product—science advances through a better understanding of the topic that was researched, but no direct benefit to society is discernible. This has been one of the reasons for the NIH initiative towards Translational Research.
As an aside, I was stunned a few weeks ago when Bill Gates was on The Daily Show with Jon Stewart and spent 15 minutes talking about the Windows Vista launch with no mention of the incredible work that his foundation is doing. Gates is changing the shape of philanthropy and this was a great time to talk about it to a large, young population who probably doesn’t think at all about gift-giving. My wife suggested the explanation—she is a professional fundraiser—that the Gates Foundation likely depends on the success of Microsoft for their financial ability to pursue their high goals. So, Gates wasn't actually wasting an opportunity on The Daily Show by being a salesman, he was simply trying to maximize the capabilities of his Foundation by promoting Vista sales. Maybe.