100% royalties offer for new technology

September 17, 2004

Universities could benefit from 100 per cent royalties with a new approach to translating discoveries into technologies unveiled this week.

The "U2B" model of technology transfer aims to track down new research on behalf of companies.

A major stumbling block for academic-business links in the UK has been the lack of firms interested in exploiting academic ideas - despite increasing numbers of offerings from universities.

The new approach, which has proved successful in the US, cuts out the role of intermediary technology-transfer companies - boosting the money that universities are likely to make from commercial pick-up.

Clifford Gross, founder of the US-based UTEK Corporation, which pioneered the U2B model in the US six years ago, claimed it would allow institutions to keep 100 per cent of the royalties by seeking out intellectual property from universities and licensing it to companies that could exploit it.

He said: "The model is sensitive to universities and companies. We facilitate the transfer of university discoveries to companies that really need it but that don't have the facilities or the capital to create intellectual property in-house. The companies get equity to get the IP and the universities get 100 per cent royalties."

The Lambert review of business-university collaboration last year concluded that "the lack of demand from UK business for the knowledge and skills in universities is a challenge". It estimated that less than 20 per cent of UK medium-sized companies have any interactions with universities.

UTEK takes on medium-sized companies as clients, then seeks out IP that will be useful to the client and acquires it from the university. UTEK takes an equity stake in the client. The university or research institution gets cash up front and full royalties from sales.

Dr Gross developed U2B while a professor in biomechanics at the University of South Florida. It now has equity stakes in 24 companies and made $10 million (£5.6 million) after tax last year.

UTEK-Pax, which will run U2B in the UK, has formed strategic alliances with Loughborough and Warwick universities.

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