John P. Molloy

Making the case for value-added technology transfer

By John P. Molloy

Approaches to the commercialization of university research are undergoing dramatic changes and any new program will have to take account of the new realities of consolidation and rationalization. In recent weeks, RE$EARCH MONEY published an article on the progress being made to accelerate commercialization of bioscience research through the creation of the Canadian Biotechnology Commercialization Initiative (CBCI).

There’s no denying the passion that Dr Fraser Mustard and his esteemed group have to improve the commercialization of university-generated intellectual property. Many in the university technology transfer community, including me, fully support Dr Mustard’s view that there is a role for public funding in the process of adding value to university intellectual property to enhance commercialization of that property.

Venture creation, however, is only one mechanism that can be used for this process. What we really need in this country is more value-added development as part of the commercialization process. In order to achieve this we need to create a better infrastructure within the university technology transfer community.

Universities and their technology transfer offices are not lacking in their ability to create spin-off companies. We have gone through an unprecedented era of spin-off company formation and, quite frankly, the move now is to consolidate and rationalize so that we can create critical mass in a reasonable number of these companies. We need to find programs to enhance our biotech companies that already have appropriate management and physical infrastructure, and turn those companies into world leaders.

There is still a role for venture creation but, more and more, that approach is merely a vehicle to add value to technology before it is partnered with or sold to a bigger company. We have to find a way to create the Canadian companies (and there will only be a few of them) that will be able to receive and bring to market the technologies coming from universities. And, we have to find a way to add value to technologies in universities so we’re more likely to be able to license these technologies to existing companies.

The landscape has changed significantly over the last few years. Technology transfer offices at universities have grown in size and sophistication and many are now beginning to realize healthy revenue streams and see their spin-off companies begin to flourish. It is critical that these offices manage the process of adding value to intellectual property, and they must be staffed and resourced to carry out this function.

We cannot ignore the experience and expertise that has been built up in this country over the past 15 years. We need to build on the strengths we already have in place and enhance those capabilities. Successful technology transfer requires close interaction and cooperation between the creators of the intellectual property and the technology transfer professionals. It is therefore imperative that we build the capacity on campus, but in such a way that the function is commercial.

This value-added approach to technology transfer is now required because the demands from investors and licensees have steadily increased. It is now difficult to attract an investor or a licensee if you have not added considerable value to the university discovery. Technology transfer offices have shown that they have the know-how to manage this process but there is no doubt that improvement is possible and resources are required to support this activity.

I am not convinced that we need to “spin-off two or three times as many companies” as suggested in the previous article. There is not much capacity to fund these companies and there is a distinct lack of management talent to service these companies.

We need to develop a national program that will allow universities, through their technology transfer offices, to recruit more highly qualified people and then provide them with the required resources to manage the process of adding value to university discoveries. This, coupled with a program to enhance the building of selected existing companies into global players, will greatly improve Canada’s ability to be competitive in the biotechnology industry.

John P. Molloy is President & CEO of PARTEQ Innovations, Queen’s University