Looking to turn your academic discovery into a commercially successful product or technology? The lure of potential payoffs may be enticing, but you will need to steer your way through many ethical, logistical, and managerial challenges. More and more universities are striving to provide resources to bridge the gap between academia and corporations. These days most universities have technology transfer offices to help researchers demystify the sometimes bewildering world of industry and entrepreneurship. They play a key role as liaison and facilitator of the interactions between a university's inventors and business.
"Our goal is to get research contracts from the world of industry and commerce into McGill so that our scientists can do research that is relevant to market needs, relevant to real people and real places, and engages society as a whole." explains Richard Bruno, Director of the Office of Technology Transfer (OTT) at McGill University in Montreal.
McGill's OTT offers a spectrum of services to the university's research community including evaluating the commercial potential of inventions and new technologies, protecting intellectual property, devising commercialization strategies, and helping to find seed funding for spin-off businesses. The McGill office serves about 1,300 research professionals and more than 5000 graduate students from the campus and its affiliated teaching hospitals, representing 22 faculties and professional schools and covering close to 300 disciplines. More than 30 universities across Canada have similar offices, though few of them operate on the same scale as McGill's. The totals for research contracts signed by OTT have risen in the past three years from $15.2 million in 2002 to $19.2 million in 2004.
"We're the ones who take the technological result of our researchers, package them properly, present them to the marketplace, and find somebody who's interested in taking on the technology," explains Bruno, "We are what you can call, in business terms, a value-added reseller of technology." Whenever an inventor comes into his office, a series of steps must be followed.
Steps to IPO
The first step in commercializing a piece of science or technology is to see how an invention may fit into the commercial world and meet industrial needs, explains Bruno. What is novel? "If it passes this first step then a 'Report of Invention' is written up by OTT that details what is unique and useful in the science."
The second step involves evaluating how this discovery can be protected through a patent. Bruno and his team look at how this technology can be transferred to a licensee company or a spin-off. Inventors should be aware that it takes 90 days to put together a commercialization program and up to 2 to 3 years to locate a potential receptor company. In the last two years, while OTT has overseen the creation of only 10 spin-off companies, nearly 80 licenses were awarded to small and large corporations both in and outside Canada. According to McGill's OTT administrator, approximately 72-75% of 'Reports of Invention' filed for the past three years are still active and being managed by OTT. Of these, approximately 10% in each year of the active reports of invention were licensed.
Licensing products and technologies is by far the most popular route for McGill inventors to take, and OTT's at universities everywhere show this same trend. Even the University of British Columbia (UBC), which leads the country with a 115 company creations in the last 20 years, saw only 2 spin-offs in 2004.
"Licensing is by and far the bread and butter of the industry now," says Angus Livingstone, Managing Director of the University-Industry Liaison Office at UBC. "About 95% of our deals are licensing with existing companies." Because investors and the market in general have been more conservative in the last couple of years, the number of start-ups has dropped significantly. Livingstone blames this trend partially on the underlying fact that creating a company takes ten times more work than a straight licensing agreement. "You don't really create a new company just for the shear joy, but because you see a business opportunity."
Understanding this business process and the attached costs and rewards is the biggest challenge facing researchers looking to commercialize an invention. A few faculty members are seasoned at bringing science to market and use their OTT with a great deal of ease and savvy. Yet most that Bruno sees are poorly informed and don't seem to understand fully the entrepreneurial process.
To help educate university faculty on the ins and outs of technology transfer, Bruno and his team launched an innovative educational system in fall 2004 called "Get WETT" ("WETT" stands for "Workshop on Entrepreneurialism and Technology Transfer"). Instead of giving lectures, the professors who attend these workshops observe and act-out on a stage various scenarios encountered by researchers looking to commercialize their technologies. The actors are real researchers, entrepreneurs, and lawyers. "The audience gets to sit in on researchers' meetings with industrial partners, lawyers, and venture capitalists and see what can go right or wrong." The workshops have been a big hit with faculty and graduate students. "They're soaking this up, they're interested in knowing, what are they're rights, how to protect their rights, how to deal with innovation," adds Bruno.
Both graduate students and postdocs can make discoveries during the course of their research projects that have potential for commercialization. But what can these early-career scientists expect from the technology transfer agreements? At UBC, Livingstone very often sees both the student and their supervisor come in together to discuss inventions, simply because the faculty themselves are not necessarily at the bench conducting the research. "The professors write grants and provide the oversight of the vision, but it's the postdocs and graduate students that actually spend time at the bench." Usually if there are students directly involved in making a discovery, there are processes in place that allow for partnerships and royalties.
While both Bruno and Livingstone find it hard to say who brings whom into the OTTs, there is always a hard look at the academic needs of both the faculty member and the grad student. At UBC, faculty members are restricted in the amount of time they can put into commercializing ventures. Graduate students have similar constraints, in that "they are here to get a degree and we don't want them spending more time working on a company than getting their degree," Livingstone explains. Often students, upon finishing their studies, move into the company. They may have taken an interim role as the company is being formed, but when they graduate, they move in and become key scientific and technical personnel in the companies.
Bruno says he feels like a kid in a candy shop, dealing with projects as diverse as aerospace and robotics. He can't help but love the research and the people. "They're wide-eyed, bright researchers who want to make a difference, and all we have to do is supply them with the right resources, the right information, and the right process and they're just dying to go."
Bruno believes that that OTT is there to help not only with the finances, but to satisfy an overall need within the academic community and to palliate some of the birthing pain involved in transferring discoveries from scientific journals to the business market.
"The more needs we can serve and the pains we can solve, the more we can have the university's focus on the outside world, and the more they can see how science can actually benefit them," says Bruno.
"I believe we are in the business of increasing the probability of creating technology that has a real impact to real people and real places for decades to come."
McGill OTT's next "Get WETT" event will be held on 15 February 2005.
Andrew Fazekas is Canadian Editor at Next Wave and may be reached at email@example.com