Oregon Health and Science University racked up a record 132 invention disclosures in its 2007 fiscal year, spun out five startup companies, and realized $1.23 million in licensing revenue — a 71 percent increase over fiscal 2006 — the university said last week.
Many university technology transfer offices release yearly metrics, but few provide as many details about their technology commercialization activity as OHSU. The school plays solely in the biomedical arena, so its metrics may shed some light on the overall health of life sciences-related technology transfer at US research institutions.
Arundeep Pradhan, director of OHSU’s Office of Technology and Research Collaborations, told BTW that the disclosures are meant to inform both internal and external constituents as to how research dollars are being translated into public benefit.
Many tech-transfer offices format their statistics in line with the Association of University Technology Managers’ annual licensing survey, which is “good and bad,” Pradhan said. “The AUTM licensing survey specifically addresses a very narrow portion of what most offices do now. At the time that the AUTM licensing survey was created, it was used to benchmark office activity, more than anything else, with other institutions.”
At OHSU, Pradhan said, the OTRC is responsible for material transfer agreements, sponsored research agreements, and IP management and commercialization. “The [AUTM] licensing survey doesn’t capture any of that,” he added.
By almost all measures of success for an academic medical center, OHSU’s fiscal year, which ends June 30, was a banner year, the university said.
The 132 invention disclosures represented a 15 percent improvement over 115 disclosures in FY 2006, and four times as many as the school recorded in 2000. OHSU also filed 66 patent applications in FY 2007, on par with previous years after a slight dip to 49 in FY 2006.
OHSU also spun out five companies in FY 2007: molecular diagnostics firm Molecular MD [see BTW, 5/28/2007]; infectious disease specialty firm ID Biopharma, a spinout from previous OHSU startup Virogenomics; Yecuris [see BTW, 8/20/2007], which is commercializing technology that enables mice to produce human liver cells; Cylerus, which is developing localized drug delivery technology for vascular grafts; and Portland Bioscience, a molecular diagnostics and health information company.
The five startups bring OHSU’s total number of spinouts to 33 since 2000 and 64 since the early 1970s, the university said.
OHSU’s $1.23 million in revenue from commercialization of university inventions in FY 2007 was 71 percent better than the $719,000 in licensing receipts realized by the school in FY 2006. The revenue was the most since the school recorded $833,000 in 2004, as OHSU saw a substantial dip in licensing revenues in 2005 with $656,000.
Of the $1.23 million in licensing revenue in FY 2007, approximately 17 percent, or $215,000, was distributed to individual inventors at the university; while 26 percent, or $366,000, was distributed to individual academic units at the university. A relatively small amount of money is distributed to AUTM-related initiatives, and the rest gets funneled back into university research and maintaining operations of the OTRC.
Pradhan said that the spike in licensing income underscores the fact that technology transfer, in the long term, can be an extremely beneficial endeavor for a university. He added that the time it has taken for significant licensing income to materialize at OHSU flies in the face of would-be critics that claim universities are focused solely on maximizing income.
“Don’t get me wrong, money is important, and it’s definitely becoming more important for academic institutions with grant dollars shrinking,” Pradhan said. “You start taking a look at the overall resources that an academic institution has, and this is right there on the top. Technology transfer does have the potential in the long term of being able to generate revenues for the institution.”
OHSU holds equity in six startups whose shares are currently publicly traded – Novacea, Adherex Technologies, Neurocrine Biosciences, Orexigen Therapeutics, StemCells, and Fonix – which totaled $2.25 million at the end of FY 2007.
For comparison, the school held approximately $2.2 million in equity in four publicly traded companies in FY 2004, but the value of OHSU’s stake in those companies dropped to $453,000 in FY 2005. At the end of last year, OHSU held $1.5 million in equity in five publicly traded startups.
Patent and other related expenses cost OHSU $954,000 in FY 2007, but more than half of that – $570,000 – was reimbursed by the school’s licensing partners. Still, that left OHSU on the hook for about $384,000 in patent expenses, or about 31 percent of its total commercialization revenue.
This was an improvement over last year, when the school logged about $1.025 million in patent expenses, and was reimbursed for just 25 percent, or $252,000. Therefore, the school was responsible for $773,000 in patent and related expenses in FY 2006, which was $53,000 more than the licensing income it brought in that year.
“Don’t get me wrong, money is important, and it’s definitely becoming more important for academic institutions with grant dollars shrinking.”
Pradhan pointed to patent expenses as a particularly bedeviling budget item, and something the university continually strives to improve upon – a feat that will likely become more challenging in the coming year as new patent rules – such as a limit of 25 claims, no more than five of which can be independent, on individual applications – go into effect on Nov. 1.
Overall, Pradhan said that he was happy with the spike in OHSU’s invention disclosures, patent applications filed, and number of commercialization agreements signed, because in the long run a quantity-over-quality strategy is best for the long-term success of the office in translating research dollars into public benefit and a financial return to the school.
“I would be lying if I said that we weren’t in the same situation as most business entities in that we want to maximize our revenues and reduce our costs,” Pradhan said. “The question is how to do that. Unlike some of the usual suspects that have complained that universities are all about homerun deals, we’re not.
“We’re about putting as many agreements into place as possible that we think are going to pay off in the long run,” he added. “I’m comfortable with hitting singles and doubles and seeing a broad base of revenue coming into the institution.”