Research pays dividend

August 1, 1997

UNIVERSITY companies charged with exploiting academic research doubled their income in just a year, according to an imminent study. Their gross income of Pounds 121 million in 1994/95 was twice that recorded by the Department of Trade and Industry a year earlier.

The finding is based on a study of 89 universities by the DTI's innovation unit as part of its 1996 survey of cooperation between universities and industry. Sixty-three of the universities wholly or partially owned 93 exploitation companies. These companies typically handle consultancy and manage intellectual property rights.

"Even allowing for more detailed reporting from institutions, these firms appear to be experiencing increasing growth," said an innovation unit spokesman.

In recent years there has been an explosion in the number of university spin-off companies, formed to exploit services or technology which have originated from institutions. The surveyed universities reported the formation of 46 such firms during 1994/95. Of these, 28 are dependent on licensing of university technology. A further 153 companies are in the process of being formed.

University patent filing activity and licensing of software developed by academics was found to be extensive. The 89 universities filed nearly 550 United Kingdom patent applications, with one university alone responsible for 38.

More than 50 UK patents were granted during the survey period. Between 1991 and 1994 the institutions filed 760 patents, an average of 252 each year.

Universities typically secure revenue from their intellectual property through licensing of technology, copyright and software and patent sales. The surveyed universities earned a total of Pounds 43 million over the period 1991 to 1994, and Pounds 15 million during 1994/95 from this activity.

An innovation unit spokesman said: "There is a lot of talk about the UK's failure to commercialise new ideas. The continued growth of spin-off firms and exploitation companies and income from intellectual property shows the picture is not as black as it is sometimes painted." A report on the findings says 2,300 university staff out of a total of 100,000 in all 111 institutions receive their principal salary from UK industry.

Nearly 80,000 undergraduate and postgraduate students - nearly 6 per cent of the total of 1.3 million - receive most of their fees from industry. Figures supplied by the Higher Education Statistics Agency to the DTI show that external research income for universities during 1996 was Pounds 1,349 million of which Pounds 145 million came directly from industry - a Pounds 20 million increase on 1995. Research incomes vary from Pounds 13 million to Pounds 1,000 per university.

The report shows considerable variation in incomes derived from UK industry when broken down by academic subject. Research in medical and life sciences secures the most income at Pounds 55 million a year, followed by engineering at Pounds 43 million. Physical sciences and mathematics account for Pounds 23 million; computing and IT for Pounds 11 million; and business, social sciences and humanities for Pounds 13 million.

The innovation unit says although the survey is only a snapshot, it provides "new and significant information about what is actually happening in universities". The DTI wants the survey to becomes an important part of the higher education scene. A spokes-man said funding councils were looking at ways of integrating this survey with other statistical data.

"We would like to see them take on and develop this work. Over a longer timescale, and with more complete reporting from universities, trends will start to emerge. We believe these trends will show growth and development of university-industry collaboration."

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