UK technology stars revealed

June 13, 2003

Details of who is paying universities for the privilege of exploiting their research and technology have emerged for the first time from an interim report by Nottingham University Business School.

The largest share of licences, options and assignments goes to UK small and medium-sized companies, with almost as many technologies being licensed to UK university spin-off companies. The rest go to large companies, small and medium-sized companies abroad and to government and other public organisations.

For its survey of the state of UK universities' technology-transfer activity, the Nubs researchers have had responses from about 50 out of the more than 100 institutions it expects to include in its full report, will be published in September.

The survey, now in its second year, was modelled on the North American Association of University Technology Managers' survey, which has been running for 11 years. The most recent AUTM survey revealed that North American universities brought in more than $1 billion (£610 million) in licensing income during 2001.

Ajay Vohora, speaking for the Nubs team of researchers, cautioned against direct comparison with the US. "The amount our government spends on research is minute compared with the US. It's like comparing a ping-pong ball with the moon. But the UK is getting better and needs to be supported and encouraged over the next five to ten years," he said.

Nubs is working with other European countries to distribute the survey free of charge so that direct comparisons can be made across Europe. Cumulative data from Europe could then be compared with North America.

The research identified four universities that were excelling: Loughborough for its efficiency, Edinburgh for generating the most income, Newcastle for the most profitable equity sell-off, and Strathclyde for the most patents.

* Loughborough University has the slickest technology-transfer operation in the UK, outstripping heavyweights Oxford and Cambridge universities and Imperial College London.

Loughborough brings in an average of £1.6 million a year from consultancy, royalties and business incubation facilities. It has long had strong sports science and engineering departments.

But its secret, according to the survey's authors, is its relationship with local industry. Deals with major companies, such as Ford, JCB and BAE Systems, have generated relationships with smaller local businesses.

Jo Derbyshire, managing director of Loughborough University Enterprises Limited, said: "Our main technology-transfer focus is on creating effective partnerships with our corporate partners and being realistic in our deal-making approach."

The university has generated 23 spin-off companies - eight in the past year - with interests ranging from advanced laser applications to sports technology and musical instrument manufacture.

* Edinburgh University collected the most income through licensing deals. In 2001-02 it generated £2.25 million. About £2 million of this came from an existing licence for a hepatitis B vaccine that was developed in the 1980s. The rest came from 20 other licence deals.

The commercialisation arm, Edinburgh Research and Innovation, employs eight full-time commercialisation staff and two who focus on company formation. Over the past four years, it has produced an average of one spin-off or start-up company per year.

Derek Waddell, deputy director of ERI, said all its business development executives have experience of working in industry so they understand both university and industrial objectives.

The challenge over the next five to ten years, he explained, would be to increase commercialisation activities, in particular widening the licensing portfolio so that the university would not be reliant on the one "star" patent for the hepatitis test, which will run out in the next few years.

* Newcastle University made £5 million from selling its shares in one of its spin-off companies, Novacastra Laboratories.

This was one of the most profitable "exits" in the higher education sector last year (an exit is when the university sells its shares to another company or to the management team of the spin-off or floats the spin-off on the stock market).

Novacastra was set up in 1989 by Wilson Horne, a professor of pathology at the university, together with a clinical pathologist and a virologist. At the time, Newcastle had no formal technology transfer operation. However, the three academics gave the university shares in the company in exchange for freeing up their time.

The company became a world-leading manufacturer of antibodies, probes and kits used primarily in cancer detection and characterisation. Last July, it was taken over by Vision BioSystems - a manufacturer of laboratory equipment for disease diagnosis - for £34.7 million. Vision now owns all the shares.

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