U.S. Chief Humanitarian: We Want to Buy Your Health Products For Poor Countries

The guy whose job is to make sure the U.S. is the world’s leading humanitarian showed up yesterday in Seattle to talk to a bunch of venture capitalists and biotech entrepreneurs.

If that sounds odd, it should. But this is Seattle, home of the Bill & Melinda Gates Foundation and a cluster of hard-charging social entrepreneurs in global health, and the speaker was Rajiv Shah. He’s a 37-year-old with a medical degree, and seven years of experience at the Gates Foundation. Shah now runs the United States Agency for International Development (USAID).

With a job like that, his main concern is to get enough food and water into a disaster zone like Haiti. But at the Life Science Innovation Northwest conference, he gave a luncheon keynote talk in which he insisted he wants to use some of the money (a $54 billion budget request in fiscal 2010) and manpower (staff of 8,000) at his command to form the kind of public-private partnerships that his former employer thinks provide the focus needed to get new drugs, diagnostics, and vaccines out in the field and actually helping people in poor countries.

It sounds good, but as anyone who has applied for a federal grant knows all too well, there’s more than a little red tape involved when public meets private. And, USAID isn’t exactly the first agency on the mind of the average biotechie looking for research support for an intriguing idea—that would be either the National Institutes of Health, the Small Business Administration, or Department of Defense. While Shah is obviously a smart, able, and ambitious guy, count me a skeptic: I’ll be shocked if USAID has any meaningful partnerships with any Northwest biotech companies one year from now.

Still, I figured there may be some people in the local biotech community who might be able to visualize a fruitful relationship with USAID. So I sat down with Shah for a few minutes after his talk to get a sense for how he’s approaching the job. Here are edited excerpts.

Xconomy: When I think of USAID, I think of people who provide food and water to disadvantaged parts of the world after a disaster. When I think of agencies that do work to stimulate life sciences R&D, it’s NIH and DoD. So what exactly can USAID do to bring forward new drugs, diagnostics, and vaccines?

Rajiv Shah: The answer is a lot. We make a significant amount of direct investment in research and product development. But I think we have some unique capabilities that could be even more effectively explored. We buy a lot of health commodities for low-income communities and low-income countries. They range from contraceptive commodities to malaria drugs to vaccines for children. That significant purchasing power could be used to create financial incentives for more technology development. We could work more effectively with other countries on the introduction of new technologies in a way that’s consistent with building strong, sustainable health systems. And we could build on our really rich record of identifying and developing those technologies that are uniquely appropriate for low-income settings where we might work in sub-Saharan Africa, or South Asia. Things that are affordable, easy to administer, and are heat-stable and not require a cold chain.

X: You mentioned in your talk that the President has a $63 billion, six-year program to stimulate global health innovation, but how much of that is within USAID, and how much purchasing power do you have?

RS: That figure represents the whole U.S. government’s global health work, which is primarily USAID, but also includes the President’s Emergency Plan for AIDS Relief (PEPFAR), and includes the work of CDC and NIH. But it’s mostly coordinated through USAID. It’s a huge opportunity to build the kinds of health systems that allow people to get access to broad medical services that disproportionately benefit women and girls and kids. It can really affect the efficiency in which we work in countries by being more organized, and coordinated, and in closer partnership with the countries we are trying to serve. I’m very excited about the global health initiative.

X: Is this unusual for someone in your position to do? I’ve not seen a USAID administrator come give a talk at a life sciences investing conference. Did your colleagues in DC think this was a little odd?

RS: It’s probably seen as a little bit unique. I personally believe science and technology, when applied appropriately, can help very poor people lead significantly better lives. We’ve seen that improved agricultural technologies can move whole communities out of poverty, improved water management policies can improve conflict and in some cases, war. Improved drinking water technologies can prevent the need for girls to take risks on long walks at night to get water, and reduce the risk of rape. New medical technologies can save lives. I would like science and technology and the application of it to be a hallmark of USAID’s future.

X: You also said USAID hasn’t always been receptive to partnerships with the private sector. What would be a couple of examples of things you intend to do differently?

RS: Over the last 10 years, USAID has had a strong history of engaging in partnerships. I think we can do those more effectively and efficiently. We should focus on those partnerships that are really about achieving outcomes. In the past, we’ve done too many partnerships that are for the purpose of doing the partnership as opposed to achieving the outcome. And we need to change the way we do our contracting, procurement, and grant-making so that we are easier partners to work with for a broader range of organizations. That’s especially true of NGOs and nonprofit organizations who aren’t the usual suspects in the federal contracting system. Those are the kinds of partners we’d like to do more work with. We need to change the way we do business in order to facilitate that.

X: If you could wave a wand, and harness the life sciences talent in this community around a handful of technologies or problems, what would they be?

RS: We’ll publish a focused, prioritized list of what the challenges are out there. At the top of the list would be effective, safe, easy-to-use vaccines for HIV/AIDS, tuberculosis, and malaria. If we can develop those breakthroughs and get them in wide use, that would change the level of suffering around the world in a huge way. That would be the top of my list.

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