Biotechnology Transfer and Commercialization
Three decades have passed since researchers from Stanford and UC San Francisco began to develop the commercial applications for their work on recombinant DNA and launched the birth of the biotech industry.
The result is a flourishing global landscape of spin-offs, startups and collaborations between biotechnology firms, financiers and academia. Those linkages were fortified in the United States with the 1980 passage of the Bayh-Dole Act, granting to universities the right to own, license and market the fruits of their faculty research.
Nations worldwide quickly followed suit. Research and innovation are increasingly shifting away from the corporate lab and back to where they began: the university campus. And as the global economy grows increasingly dependent on the generation and dissemination of knowledge, universities are seen as natural partners for both business and government.
With government sources of R&D funding often mandating in-kind private-sector investments, the university-industry relationship is growing more complex and entwined. For this reason, it is crucial to examine the process of university technology transfer for its strengths and vulnerabilities in order to facilitate the commercialization process and ensure the greatest possible returns on public investment.
Technology transfer reflects a delicate balance
University research tends to be oriented toward basic research that addresses long-term, fundamental scientific discovery and knowledge. An increasing share of the funding – from government, industry, nonprofit donor and other sources – is going into biotechnology and the life sciences, as evidenced by the dramatic increase since 1995 in university patenting.
The core mission of the world’s leading research universities is education, discovery research and the dissemination of knowledge. It is also understood that the commercialization of research and knowledge is controversial to some audiences.
Many academic researchers are conflicted by the greater focus on commercialization, feeling that it might impede research in areas with a lower probability of direct-market applicability but which could nevertheless lead to advances in fundamental scientific knowledge. We maintain that technology transfer reflects the delicate balance of a university’s wider culture and is, in fact, an important byproduct of its mission.
In this study, we examine the biotech transfer process taking place at universities, from knowledge creation to technology transfer and early-stage commercialization. A key focus of our investigation is the role played by technology transfer professionals. Research is essential for commercial outcome, but the technology transfer professional is crucial in the successful conversion of knowledge to the private sector.
- Harvard ranks first in terms of biotech research, as measured by papers and citations, followed by the University of Tokyo and University of London. U.S. universities hold eight of the top 10, and 28 of the top 40 positions. California universities hold five of the top 25 rankings; the UK and Japan hold three each.
- The University of Texas system scores first on our Biotech Patent Composite Index, followed by UC San Francisco – which is likely first among individual campuses since the University of Texas doesn’t report data on individual campuses – and Johns Hopkins. Nine of the top 10 patent holders are U.S. universities. The University of London ranks first among foreign universities (10th overall). (U.S.-issued university biotech patents grew from a cumulative total of 433 through 1995 to 11,430 in 2004.)
- Our University Technology Transfer and Commercialization Index shows MIT first on outcome measures, which include such factors as licensing income and startups. The University of California system ranks second (led by UC San Francisco), with Caltech third, Stanford fourth and Florida fifth. The University of British Columbia was the highest-ranked Canadian institution, coming in eighth overall.
- Among U.S., Canadian and European universities, the United States leads in invention disclosures, patents filed and granted, licenses executed and licensing income. However, European universities surpass their U.S. counterparts in startups established.
- Research activity has a high rate of return. Each 10-point increase in our Research Papers score contributes an additional $1.7 million in annual licensing income.
- Investments into OTTs also offer high returns. For every $1 invested in OTT staff, the university receives a little more than $6 of licensing income.
- In terms of job creation, the Amgens and Genentechs most differentiate the economic impact of U.S. university-based biotech commercialization that originates from universities in other nations.
The Milken Institute is an independent economic think tank whose mission is to improve the lives and economic conditions of diverse populations in the U.S. and around the world by helping business and public policy leaders identify and implement innovative ideas for creating broad-based prosperity.
We put research to work with the goal of revitalizing regions and finding new ways to generate capital for people with original ideas. We do this by focusing on human capital – the talent, knowledge and experience of people, and their value to organizations, economies and society; financial capital – innovations that allocate financial resources efficiently, especially to those who ordinarily would not have access to it, but who can best use it to build companies, create jobs and solve long-standing social and economic problems; and social capital – the bonds of society, including schools, health care, cultural institutions and government services, that underlie economic advancement. By creating ways to spread the benefits of human, financial and social capital to as many people as possible – the democratization of capital – we hope to contribute to prosperity and freedom in all corners of the globe. We are nonprofit, nonpartisan and publicly supported.
By Ross DeVol and Armen Bedroussian, edited by Alan Gray