Science - Industry Relationships in High-tech Sectors: Transatlantic Perspectives

Transcription

1 Science - Industry Relationships in High-tech Sectors: Transatlantic Perspectives OECD / BMB+F Conference on Industry - Science Relationships Berlin, October 16-17th, 2000 no. 1

2 1. Empirical Basis Higher Education & Industrial Innovation Study on behalf of the European Commission no. 2

3 Regional Scope of the Study United States of America Germany France United Kingdom Austria Portugal no. 3

4 Empirical Basis U.S. - Germany Comparison: 24 participating companies / company sites in the United States and Germany major multinational players as well as innovative start-up companies in the ICT and pharmaceutical / biotech industries 36 universities and basic / applied research institutes in the United States and Germany 175 interviews with 130 individuals in industry and academia between June 1999 and August 2000 no. 4

5 Themes: Differences & Complementarities Prevailing Types of Collaboration Core Issues in University - Industry Collaboration - The Transfer Gap in U-I Relationships - Intellectual Property Rights (IPR) - University Spin-off Companies no. 5

6 2. Differences and Complementarities At the root of the issue... Linking up two highly different partners Academic research curiosity-driven long-term time horizons (5y +) emphasis on depth & latitude dispersion of energies from idea to solution in principle goal: breakthrough discoveries Industry research purpose-driven time horizons max. 3-5 years less depth & latitude bundling & focusing of energies from demonstrator to product goal: product development no. 6

7 Differences as a source of synergistic complementarities: Industry research needs ideas input from academic research. Industry can take research results further than academia could (or would) ever do. Industry can provide funding for university research in topic areas that would not attract public funding. Industry, through collaboration, gains access to the results of publicly sponsored research (e.g., NIH; DARPA). Academia gets access to technologies / equipment / databases they could not afford themselves (e.g., genomic information; model organisms). Industry gains access to specific technologies that individual companies would not invest in (e.g., Millennium test bed). no. 7

8 Differences as a source of synergistic complementarities: U-I collaboration lowers the cost of high-risk projects for industry. Academia obtains information about where industry s innovation activities are headed for. Research funding from industry compensates for declining public funding. Universities obtain research funding with less strings attached than in the case of government funding. Industry funding inflicts a sense of relevance into academic research. Collaborative research with industry can help coordinate and focus dispersed activities of university researchers (pooling of energies). Through industry collaboration academic researchers can learn to use resources more efficiently. no. 8

9 Differences as a source of an uneasy relationship Giving rise to complaints on both sides: industry demands that universities should become more business-like, IPR conscious, more focused on relevant research, and more like service providers. academic complaints about industry s short-term horizons, risk aversion, obsession with secrecy, timelines, and milestones. BUT: Reducing the differences may mean also a reduction of the mutual gains from collaboration. no. 9

10 3. Prevailing Types of Collaboration Germany Focused contract research: Industry-defined discrete, short-term projects (6-12 months) with clearly specified objectives, timelines, milestones, and deliverables. IPR resting with the company. Emphasis on applied research of the high-risk / low budget type. Academia seen as a low-cost service provider. Publicly co-sponsored research consortia: Longer-term, mostly industry-defined research collaborations uniting several academic and industry partners under the leadership of a major corporate player. IPR negotiated between partners. (e.g. BMB+F lead projects ) no. 10

11 United States Little contract research / less collaboration overall University - Industry Research Centers (UIRCs): University-initiated, renewable grants from one or more corporate sponsors. More basic research with broadly defined topics and few direct links to corporate R&D activities. IPR usually rests with the university, the company having the right of first refusal. Mega deals / endowment-type umbrella agreements Multi-year, multimillion dollar research agreements between companies and university departments. Applied research projects defined by university researchers and approved by joint research committees. IPR resting with the university, company can negotiate exclusive licenses. no. 11

12 Examples of mega deals in the U.S Hoechst - Massachusetts General Hospital (> $100 m). Field: Molecular biology. Objective: corporate exposure & learning ( window function ) Sandoz (Novartis) - Dana Farber Cancer Institute / Harvard Medical School ($ 100 m). Field: cancer drugs Rhône-Poulenc-Rorer - Stanford ($ 10 m). Field: gene therapy Novartis / NADI - UC Berkeley ($ 25 m). Field: plant & microbial biology. Objectives more closely geared to corporate R&D agenda Nanovations - M.I.T. : establishment of a $ 90 m joint research center for research in the microphotonics area. no. 12

13 4. Core Issues in University - Industry Relationships Where do the actors involved perceive the most controversial issues and most important challenges in industry - university relationships? The transfer gap from concept to robust prototype The IPR deadlock University spin-offs no. 13

14 The Transfer Gap in U-I Relations University Industry Idea Concept Solution in Principle Demonstrator Robust Prototype Manufacturable Product Industry-University Centers Specialized Research Institutes (FhG-type) University Spin-off Companies Corporate R&D Function no. 14

15 IPR Regimes For very different reasons, one of the most controversial issues and concerns emerging from our interviews in both countries is the IPR issue - Intellectual Property Rights - alluded to from both sides as the sore point, the roadblock, the most sensitive nerve in industry-university relationships.... despite the fact that both countries still have very distinct regimes governing IPR in university - industry relationships. no. 15

16 IPR Regimes: Germany In the past, a very comfortable situation for companies engaging in contract research with universities / public research institutes: - academic partners not IPR-oriented /little patenting expertise (universities not permitted to have licensing revenue) - professors ( free inventors ) willing to give away IPR in exchange for publication rights & consulting contracts - only companies usually had the expertise and means to file patents. no. 16

17 IPR Regimes: Germany Recently, IPR has become an issue: - universities are given more autonomy to explore new sources of revenue, including IPR and licensing - political moves towards weakening the professors free inventor status in favor of universities as their employers - reduced public funding and increasing pressures on public research institutes to raise more external funding from industry contracts. The IPR regime governing industry - university relations is seen as moving closer towards the U.S. model. no. 17

18 IPR Regimes: Germany Universities still have a very lax attitude towards and lack of expertise in IPR matters. Professors anticipate a decline in industry - university collaboration due to less incentives for professors and industry. Public research institutes are facing a dilemma: - need to provide more pre-development type services for industry, involving stricter IPR claims from corporate partners; - need to retain IPR in core areas of expertise in order to prevent a bleeding out and remain a partner for industry in the future; - tougher IPR stance of public research institutes has led to a deadlock in contract negotiations with companies. no. 18

19 IPR Regimes: United States In most cases universities retain full IPR. Sponsoring companies have the right of first refusal (right to negotiate non-exclusive / exclusive licenses, sometimes with the obligation to develop a product). State laws have defined rigid IPR rules for U-I collaborations and prohibit universities from selling out their IPR to industry. The one-size-fits-all approach of the IPR regime creates problems by ignoring differing industry conditions & needs. (e.g., the pharmaceutical versus the ICT industries) no. 19

20 IPR Regimes: United States University faculty criticize the IPR regime as a roadblock to more U-I collaboration. They advocate a de-centralization with more discretion being given to professors. The U.S. IPR regime has created a schism between industry, university faculty, and university administrations, with professors often viewing Tech Transfer Offices as their foes and industry viewing them as bureaucratic obstructionists. Only top universities (whom major companies cannot afford not to cooperate with ) are able to attract major industry funding. no. 20

21 University Spin-offs: United States University spin-offs provide an outlet out of the IPR-induced collaboration blockage for both faculty and industry. - university faculty found companies and obtain licences for using IP generated in the university. Through spin-off companies, faculty can make deals with industry more freely. - companies prefer dealing with spin-offs because they can control IPR (including by acquiring the company). - universities support spin-off activities since, if successful, they promise future revenues while the risks are borne by founders and venture capitalists. no. 21

22 University Spin-offs: Germany Spin-off activities are gradually taking off in knowledgeintensive sectors (ICT and pharma / biotech). - As yet only few restraints for university researchers on transferring knowledge generated in academia to their spin-off companies (universities not charging royalties). - In anticipation of imminent changes in universities IPR regimes, professors establish spin-off companies to be able to continue industry collaboration without IPR restraints. - MPG and FhG have started to take stakes (shares) in spin-off companies evolving from them. no. 22

23 University Spin-offs Creating ambiguity: - university researchers dual role as professors representing the university and entrepreneurs working for their own profit renders U-I relations more difficult ( dual hat syndrome ). - the proliferating spin-off culture is in danger of skewing faculty s research orientations and basic research at the university towards commercially promising areas / topics. no. 23

24 University Spin-offs University spin-off companies have become a powerful mechanism of U-I knowledge transfer, specifically in the drugs and ICT industries. University spin-off companies provide a solution to the problem of bridging the gap between solutions-inprinciple generated in academia and the robust prototypes needed by industry. For companies in science-intensive industries, the acquisition of spin-off companies has become an important channel of knowledge sourcing. Major companies are complementing (partly replacing) their U-I collaboration by the systematic screening of the spinoff scene for promising acquisition candidates ( scouting ). no. 24