The University of Pittsburgh recorded a 72-percent increase in US patents and a 34-percent rise in licensing revenues for fiscal 2008, according to an annual report released last week by the school’s Office of Technology Management.
The increased tech-transfer activity for the year ended June 30 — roughly three-quarters of which was in the area of life sciences — reflects an ongoing effort to promote a more entrepreneurial culture among its faculty members and to bolster relationships with industry, an OTM official said this week.
In addition, the number of inventions disclosed by Pitt faculty in FY 2008 held steady, while the number of patent applications filed on behalf of university inventors rose slightly from the previous year – both signs that point to a sustained level of entrepreneurship among Pitt faculty, according to the OTM.
However, the number of companies the university spun out in 2008 fell to three from eight, a decline the OTM blamed more on timing than anything else.
According to the OTM’s annual report, Pitt inventors were awarded 36 US patents, up 72 percent from the 21 patents awarded in the previous year. Fiscal 2008 also saw Pitt faculty members win the most patents since 2004, when they garnered 39 US patents.
The OTM said that patent applications increased to 100 in fiscal 2008 from 95 in 2007; and that invention disclosures declined slightly to 244 in 2008 from 246 year over year.
However, these metrics have increased dramatically over the past four years: In 2004, the OTM filed 58 US patent applications, and Pitt faculty members disclosed 140 inventions to the office.
In addition, Pitt said that tech transfer-related revenue swelled 28 percent in fiscal 2008 to $9.09 million from $7.13 million in 2007. The 2008 revenue total includes $6.67 million in licensing revenue — a 34 percent increase over the previous year — and $2.42 million in legal fee reimbursements.
However, unlike the previous two years, the revenue increase does not include money received from the sale of equity in startup companies formed around Pitt technologies, meaning it stemmed mostly from licensing deals. For comparison, the school received a $6.7 million windfall in FY06 from the sale of Pitt medical device startup Stentor, while in FY07 it reaped $92,000 from the sale of its stake in biotech firm Novacea.
Daniel Bates, strategic relations manager for the Pitt OTM, told BTW this week that the school’s licensing revenues are from many ongoing smaller licensing agreements, as opposed to one or two “homerun” deals that would account for a majority of the profits.
“Part of that goes back to our philosophy in general, which is, rather than trying to find those two or three technologies that really have huge potential, we’re trying to get out as many as we can,” Bates said.
“We still have to triage them, and make some decisions, and out of 244 disclosures this year, probably 50 or 60 percent [will] move forward, so there are a lot of ideas that need to be cultivated,” he added. “But our mindset is to try and get as many of those out the door as we can.”
‘Change the Culture’
In terms of measuring the overall success of tech transfer at Pitt, the OTM looks at all of the aforementioned metrics together, Bates said. However, the office has in past years focused more on numbers such as invention disclosures, patent applications filed, and patents awarded. The OTC said these numbers reflect its effort, ongoing since at least 2002, to promote entrepreneurship among university faculty.
“My role has been largely on the front end of the process, trying to change the culture on campus, trying to get more faculty members engaged in the process,” Bates said. “That has been a big emphasis of ours over the last four years, and that’s where we’ve seen a great increase in numbers. We’ve done a number of things to motivate and educate them.”
“Part of that goes back to our philosophy in general, which is rather than trying to find those two or three technologies that really have huge potential, we’re trying to get out as many as we can.”
Examples of this effort include forming a commercialization advisory committee comprising select Pitt faculty members who have shown a knack in the past for innovation; launching a quarterly newsletter in March devoted to faculty entrepreneurship; and last summer’s genesis of a commercialization fellowship program in which a handful of business students from Pitt’s Katz Graduate School of Business Administration and the undergraduate College of Business Administration work with OTM or OED employees to provide additional business know-how.
Furthermore, Bates said that the Office of the Provost at Pitt in 2002 launched a course called Academic Entrepreneurship: The Business of Commercial Innovation, to be offered each fall.
“We’ve been running that for about six years, but it has really taken hold in the past four years or so,” Bates said. “That’s something that the provost’s office funds, so you have that top-down commitment. We inevitably get 20 to 30 faculty members and graduate students participating in that.”
In recent years, Pitt’s tech-transfer officials have also made a concerted effort to reach out to industry, but without compromising the “customer service” that it provides to its faculty members, Bates said. As a result, the OTM focuses more on the nuts and bolts of tech transfer, including working with faculty to vet inventions; while another office, the Office of Enterprise Development, Health Sciences, focuses on forging industry relationships.
To be sure, it remains to be seen whether the OTM’s efforts will result in a growing number of faculty members’ inventions reaching the marketplace. Though the boost in licensing revenues last year could be an early reflection of the increased efforts, the level of deal-making involving Pitt technologies has not risen despite the steady increase in disclosures and patents.
According to the report, the OTM executed 58 licenses or options for Pitt technologies in FY08, the same as in the previous year. In fact, this number has remained relatively steady over the past five years, dipping no lower than 53 in FY2004 and topping out at 58 in 2005, 2007, and 2008.
“We’re happy where we are, because we’re working as much on the cultural side as we are on the straight numbers side,” Bates said. “We want [faculty] to really participate in the process, and that takes time.”
Furthermore, the university spun out less than half as many startups in fiscal 2008 than in 2007. Explaining the decline, Bates cited “a matter of timing. We’re always working on a bunch [of startups] at one time, but …sustainability is an important criterion on our part,” he said. “We want to make sure that when these companies are set up, they’ve got the funding and management in place. We’re not one to just license it to a non-sustainable entity so we can boost the numbers.”
All of Pitt’s spinouts in FY08 were in the biomedical arena: Cardiobiotics, which develops robotic probes for minimally invasive surgery; EPR-Technologies, which is based on medical procedures that use a state of hypothermia to put trauma victims in a temporary state of suspended animation for delayed treatment; and Prevencio, which is developing a series of circulating protein signatures that signify acute or chronic vascular disease.
Similarly, the majority of Pitt’s tech-transfer activity — about 75 to 80 percent, Bates estimated — can be broadly categorized as life science-related thanks mostly to the several health-related schools associated with Pitt, as well as the University of Pittsburgh Medical Center, where many of the faculty members have dual appointments in other Pitt departments.