Friday, December 3, 2004 - Page updated at 12:00 AM

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Survey cites slow progress in NW technology transfer

Seattle Times business reporter

The Northwest's research institutions are among the best in the country at attracting financial support for their work, but they trail behind many of their peers in generating cash from their discoveries and spinning out new companies, a national survey shows.

The University of Washington is the nation's top-funded public research university, but spins out fewer inventions and startup companies than leading rivals. The Fred Hutchinson Cancer Research Center has world-class research, but has created just one startup in the past three years. Oregon Health & Science University discovered one of the best cancer treatments ever, yet doesn't see a penny of the profits.

The results come from a survey by the Association of University Technology Managers, which looked at 236 major research institutions in the United States and Canada in fiscal 2003. It measures keys to technology transfer — how much research money flows into the institution, how many patent-worthy inventions emerge, how much money the institution receives back from licensing, and how many startup companies it produces.

Nationally, the survey found research funding has increased 10 percent, patent applications increased 8 percent, and licensing income at institutions rose 6 percent over the previous year. The figures are based on data reported by the institutions and are not independently verified.

The University of Washington ranked, as it has for several years, as the top-funded public research university in the country. It reported $784 million of research funding in fiscal 2003 from the federal government, foundations and industry. The UW reported 199 invention disclosures, 46 patents received, and three startups. It showed $29.1 million of licensing income, with a $6 million boost coming from a one-time patent litigation settlement that went to Washington Research Foundation, which manages some of UW's intellectual property.

The size of the UW's research budget ranks behind only two private schools in the survey, the Massachusetts Institute of Technology and Johns Hopkins University, and just ahead of one public institution, the University of Michigan. All three produced more disclosed inventions, patents and startups than the UW, according to the survey.

The University of Michigan, a comparable state institution, outpaced the UW in invention disclosures (257 to 199), patents (64 to 46) and startups (9 to 3). But the UW received much more money from its licenses ($29.1 million to $7.4 million). The UW's licensing income also surpassed MIT's.

Much of the UW's revenue comes from biological inventions from the early 1980s, one of which is used to produce drugs in yeast. It often takes years for the university transfers to pay off. Among recent UW spinoffs is Teranode, a maker of laboratory software, which has attracted some prominent customers but like all startups, will likely take years to reach its potential.

Jim Severson, UW vice provost for intellectual property and technology transfer, said he wants to increase the number of invention disclosures, licenses and startups. More recent statistics for 2004 already show increases, with invention disclosures up 17 percent, and seven UW spinoff companies.

"If you look at where we stand nationally, we're in the top 10 in the significant measurements," Severson said. "We're doing pretty well."

The report also showed the UW produces much more business activity than other research institutions in the Northwest.

The Seattle-based Fred Hutchinson Cancer Research Center reported a $203 million research budget, five new patents, just under $1 million in licensing income, and zero startups. By contrast, M.D. Anderson Cancer Center in Texas, a comparable institution, reported nearly quadruple the patents (19), triple the licensing income ($3.3 million), and three startups.

Spencer Lemons, a former technology transfer director from Wake Forest University who was recruited to the Hutch in August, said the performance needs to improve. "Those numbers are part of the reason I'm here," he said.

Lemons said he is boosting his office's staff from six to nine and energetically marketing discoveries to companies. He said he is working on launching several possible startups.

"We want to be on par with other peer institutions, and we'll knock ourselves out to get there," Lemons said.

Arundeep Pradhan, director of technology and research collaborations at Oregon Health & Science University, said he has similar goals. He said his office is focusing on mentoring faculty on savvy business practices.

OHSU has reason to focus there. Researchers there did pioneering work on Gleevec, a breakthrough drug for chronic myeloid leukemia, which is now selling at a pace of $1.6 billion a year. If the university had gotten a typical 1 percent royalty stream from Gleevec's maker, Novartis, it could be taking in between $10 million to $20 million a year.

Instead, the school said it received $696,000 from all technology licenses. Pradhan said none of that comes Gleevec.

"We were upset we couldn't capture more value from that," Pradhan said. "We're doing things differently now."

Luke Timmerman: 206-515-5644 or

Copyright © 2004 The Seattle Times Company


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