Leader: Strong foundation can be built upon licences

January 11, 2002

We should indeed, as Richard ffrench-Constant suggests (see "UK risks patent foul-up"), be learning from Warf, the Wisconsin Alumni Research Foundation. The first lesson is that we have a lot of catching up to do. Warf, best known for the blood anticoagulant Warfarin, was set up in 19 to exploit Harry Steenbock's breakthrough research on vitamin D (licensed first to breakfast cereal companies). It was only in the 1980s that British universities were freed from government control to offer licences on their discoveries to all comers.

The second lesson is patience. Running a licensing business is expensive and the returns slow. UK spin-offs are driven in part by need for immediate revenue. Government approval (and therefore hope of money) attaches to the formation of spin-offs. Companies allow researchers to raise substantial sums on the market quickly, as James Burnie and Ruth Matthews hope to do with Neutec. The device also protects the university from possible catastrophic loss - and probable arraignment before the Public Accounts Committee for improper use of public funds.

The third lesson is that the foundation model is a good one. The commercial business is carried on in a separate organisation, and profits are channelled to the university as that most desirable commodity - unencumbered money. In 70 years, Warf has given the University of Wisconsin-Madison more than $300 million to support research.

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