Patents provide universities with slender returns

February 5, 1999

Julia Hinde A leading US technology licensing manager has warned universities that commercialising their research will never make a major contribution to their budgets.

At the American Association for the Advancement of Science meeting in Anaheim, California, Lita Nelsen, director of the Technology Licensing Office at the Massachusetts Institute of Technology, said that among top US licensing universities, revenue from allowing industry to use universities' patents still makes up less than 2 per cent of an institution's budget even though 3,000 licensing agreements were made by US universities in 1997.

"The all-time blockbuster patent took $250 million," Ms Nelsen said. Over the patent's 12-year span, each of the two universities involved collected about $10 million a year. This was against an annual research budget of $600 million at one of the two universities, Stanford.

"What we are saying is even the biggest licensing lottery winner is not going to be a major contribution to university budgets," Ms Nelsen said.

C. Kumar N. Patel, vice-chancellor of research at the University of California, Los Angeles, added that overall in the US, a country to which the UK is looking for technology transfer know-how, industry funding accounts for just 7 to 8 per cent of total basic research support in universities. Despite huge efforts, the figure has changed little in the past 30 years.

Luke Georghiou, director of Manchester University's Policy Research in Engineering, Science and Technology (PREST), agreed that patents form a small percentage of university incomes. "It is clear that Stanford views its work on intellectual property and spin-offs as primarily motivated by a wish to contribute to the economy rather than a wish to benefit the university.

"We should remember that universities get more than ten times as much income from direct work with industry, and even more from government research."

As the interaction between universities and industry increases, some universities may be making unwise compromises in a bid to attract industry support, said Ms Nelsen.

She suggested that some US universities may be holding back publishing results or granting ownership of patents to companies against their better interests to win support. Although there has been a huge increase in the amount of collaboration and interaction with business in the 1990s at MIT, Ms Nelsen said the university has made very few compromises on patents or publications.

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