Tom Hockaday, managing director of Oxford University’s technology commercialisation company Isis Innovation, talks about the future of technology transfer as models of moving research and ideas from universities to the wider world evolve.
“The world is getting more global,” said former US President George W Bush in one of his infamous Bushisms – along with the one about the French not having a word for entrepreneur.
The world of technology transfer has always been a global one, as international intellectual property (IP) rights are licensed to international businesses. Yet, at Isis we are finding that as we increase our activities in places such as China, Mexico and Australia, technology transfer is also becoming increasingly local, stimulating entrepreneurship and economic growth around the university.
As technology transfer processes continue to evolve, universities and governments – particularly those in emerging economies which are now actively exploring how best to develop their own technology transfer models for the first time – are building on the experience of the past decades to map the road ahead.
We have a wealth of experience to draw on and I would like first to describe the major phases of past decades of technology transfer, and then discuss some new themes that are emerging as important to the future of successful technology transfer offices (TTOs) and their universities.
Phase 1: The old days – In this phase there were a small number of small-scale interactions between researchers and industry. These were often based on contacts between university researchers and their alumni now working in industry.
In addition, there was a small number of large-scale connections where industry funded a substantial programme of research in a university department.
TTOs did not exist. Universities were developing industrial liaison offices of one sort or another, often staffed by university researchers who were interested in engaging with industry.
Phase 2: The heydays – As university researchers interacted more with industry, they began to realise the value of the intellectual property arising from their research activities. Industry also showed increased interest in their ideas, technologies and expertise. In the UK, this was coupled with the high-profile example of UK universities and industry failing to capture substantial value from monoclonal antibody technology first developed in Cambridge in the early 1980s. This in turn rekindled memory of the wealth generated outside Britain from Oxford-developed penicillin.
Universities began to set up their own TTOs, and government encouraged this. Oxford University set up Isis Innovation as its wholly-owned technology transfer company in 1988.
UK experience lagged US experience by a few years. The US equivalent of the 1985 UK legislation that allowed university-driven technology transfer was the 1980 Bayh-Dole Act.
TTOs played a role in managing an increasing number, but never all, of a university’s interactions with industry. They grew in size, learning what to count and how to present it as evidence of good things happening, in their universities and in local and national economies. Governments liked what they saw, in their minds converting numbers of patent filings and new companies into direct evidence of sustainable economic growth.
Governments provided grants and TTOs grew further.
Phase 3: The winds of change – University TTOs matured, developing more organised and professional project management processes and staff learning and development programmes.
However, the reality of technology transfer also became clear – it often takes a very long time for technology transfer to bear fruit, and it also takes time to establish a successful technology transfer programme in a university.
Success is as much about connecting university technologies with industry as making money. TTOs are not get-rich-quick offices.
The debate settled into an understanding of TTOs having two main objectives – primarily to transfer technologies to industry so the technologies receive the investment required to deliver better products and services to people and society, and to generate financial returns for the host university and its researchers.
Nevertheless, many TTOs struggled to break even after a number of years, and their universities questioned the best approach. Some universities in the UK passed the challenge over to the private sector, contracting to or partnering suppliers of technology transfer services.
However, this did not change the fact that it is a rare blend of the right science, the right business management competencies and the right marketplace that leads to success in taking a new technology to market.
Phase 4: Economic pressures – This brings us to the present day. In the face of these changes, TTOs need to adopt more flexible models and approaches to satisfy the changing ways researchers view the use of IP.
In industry, some companies have been adopting the principles of open innovation and looking to establish long-term collaborative partnerships with selected universities. Other companies have moved in the opposite direction, becoming less innovative, relying on technologies at higher “technology readiness levels”, expanding the gap between university research and industry.
Researchers continue to want help from experts in the TTO, but in new ways. TTOs are asked to spend more time supporting research funding applications, either because they involve IP negotiations in research funding discussions with industry, or because government and non-profit research funders want more evidence of how their money will be used to ensure ideas reach through to the end user – consumer or patient.
Phase 5: Impacts of impact – Universities in the UK have recently submitted data to the Research Excellence Framework (Ref) – the latest version of the government exercise that takes place every few years to assess the quality of research in every department in every university. Other countries are watching with interest. Some are already planning to adopt a similar approach.
For the first time, this exercise involves points being awarded for “impact”. The government defines impact in some detail – it can broadly be summarised as benefits to society.
The impact case studies are important – 20% of the points awarded relate to the strength of impact that a department can demonstrate. And points mean prizes – billions of pounds of government funding will be allocated over many years based on Ref scores.
Many researchers embrace this, many will fight it well into their pensions. One outcome already has been that universities are becoming far better at telling the stories of how their activities touch and benefit people’s lives around the world. Universities really are a good thing.
Researchers are also now far more motivated than before to see their research transferred from the university into society.
The future
For university technology transfer organisations such as Isis, integrated in a burgeoning entrepreneurial community in and around Oxford – to whose existence Isis has contributed substantially over past decades – it is also becoming clear that the opportunities to promote local entrepreneurship may be just as relevant as international patent applications.
The new model of combining traditional technology transfer with student entrepreneurship activities and with local business interactions is very appealing.
Here at Isis, both of these themes are gaining momentum.
In analysing our own business recently, we found that one in five of our licensing agreements is signed with local companies and over 50% of our licensing agreements are with spin-outs, start-ups, micro-companies or small and medium-sized enterprises, thereby enabling small, high-growth potential companies to access world-class innovations.
At the same time, our business is expanding its reach globally. Although the majority of our licensing agreements are signed with European organisations, including UK, and substantial numbers are signed with North American companies, a growing number of licensing deals are being signed with companies in Asia, cementing Isis’s recent strategy of opening offices in this region.
Likewise, the Isis Software Incubator in Oxford, which was launched in 2010 to support software entrepreneurs working with academics, students and business school alumni from across the university, has already graduated 11 companies and is currently working with a pipeline of 26 ventures.
The smart university
Everything changes, nothing stays the same. University technology transfer offices have evolved and grown over the past 30 years, as have the universities and communities they serve.
The smart university will continue to invest in its technology transfer office to protect its long-term interests, as a way to engage and contribute to the local and international business community, and to realise the potential and returns from its research-based intellectual property.