Capitalism means that there is much more research into male baldness than there is into diseases such as malaria, which mostly affect poor people, said Bill Gates, speaking at the Royal Academy of Engineering's Global Grand Challenges Summit.
"Our priorities are tilted by marketplace imperatives," he said. "The malaria vaccine in humanist terms is the biggest need. But it gets virtually no funding. But if you are working on male baldness or other things you get an order of magnitude more research funding because of the voice in the marketplace than something like malaria."
As a result, governments and philanthropic organisations have to step in to offset this "flaw in the pure capitalistic approach". The Gates Foundationfocuses on finding under invested areas of basic science and focusing an innovation agenda on the needs of the poor, specifically looking at education and health.
Gates identified a number of key challenges that he called "daunting". The first was feeding the world when we have a population of 10 billion. He argued that tools of the "genetic revolution" could equally apply to understanding seeds and key crops in the world to help understand how to grow more food.
A bigger challenge affecting the poorest in the world is infectious disease. "For helping out the poorest we still need very simple things -- keeping vaccines refrigerated. But where there's no electricity, delivering diesel or propane is hard, we have tens of thousands of children who die because the vaccine supply chain doesn't have these tools," Gates said. "We still have a lot of deaths that really shouldn't take place."
He hopes to see the mortality of children under the age of five to reduce from seven million per year to below three million by 2030. That's from a massive 20 million in the 1960s, where children were dying of small pox, diarrhoea, measles, malaria and pneumonia.
Gates felt that the medical engineering community could focus its attention on depot treatments (where slow-release drugs are injected into the skin to deliver treatment over a long time period). "Why is it so much harder to get medicine used in the developing world versus the rich world? Because people have to go back and visit again and again. But if you could give TB medicine or birth control that would leak over 60 days, that would make a huge difference."
Another key area where engineers can help is keeping vaccines cold. "Engineers are going to invent a magic thermos that leaks heat so little we don't need a power source. Or some laser shooting device that can kill mosquitos. In almost every disease there are things that go well beyond the bounds of biology."
Climate change is a major challenge and Gates argued that we need engineering innovation that gives us low cost power and emits no CO2. "Governments could be doing more to fund the basic research, but we need to solve it very quickly. We don't have the luxury of waiting."
When asked by an audience member whether it was possible to build a social company that is also profitable, Gates said: "There are a number of areas where you can build a product that has value in the rich world, for middle income countries and the poorest. Ideally you create a business model that lets you get your margin from the rich countries and the middle income countries, or through tiering customers in developing countries."
He cited eye clinics in India that offer free lens replacement and other treatments to the poor but charges those who can afford it as a good example of a tiered system. However, he concluded that "it takes a lot of creativity to get the best of both worlds".
With regards to encouraging more students into STEM education, Gates said: "It's kind of surprising that we have such a deficit of people going into those fields. Look at where you can have the most interesting job that pays well and will have impact on society -- all three of those things line up to say science and engineering and yet in most rich countries we see decline. Asia is an exception."
He added that in the last few years in the US, computer science has seen enrolment go back to 1999 levels, but that the sciences broadly had big deficits as well as a lack of racial diversity and gender diversity.
"We are failing to get women in. There must be something about how we teach the sciences that makes them not seem that attractive."