Forbes published an interesting article last week which named the universities in this country with the most successful tech transfer programs in terms of rate of return (“ROI”), according to a 2006 survey.

At the top of the list was New York University.  Forbes reported as follows:

[New York University] generates $157 million in research-related income on $210 million in research and development (R&D) expenditures–tops the list with a 75% yield. . . . While Remicade has generated the bulk of NYU’s licensing income in the last decade, some 20 other biomedical technologies kick off royalties as well–and 15 more are in clinical trials. . . . Other hot areas include computer science, agriculture and nanotechnology. NYU also takes stakes in start-ups, including Perceptive Pixel, developer of the touch-screen map that CNN uses in its election coverage.

Next on the list was Wake Forest University, which had a 41% ROI.  According to Forbes, Wake Forest’s success was due in part to several patents, which generated more than $1 million in licensing revenue and the development of several key technologies, including the V.A.C. System, a mechanical vacuum technology that promotes wound-healing, which was licensed to San Antonio-based Kinetic Technologies, and a virtual endoscopy machine, which was licensed to GE Medical, a unit of General Electric.

Other successful programs included the Stevens Institute of Technology, Ohio University, Brigham Young University, and University of Rochester.

Interestingly enough, the University of California System (which includes all of its various institutions and campuses around the state) only came in fourteenth on the list, even though it reportedly generates more in total revenue from research than all other U.S. universities.  According to Forbes, out of the University of California System’s $48 million licensing program, about $24 million was incurred from royalties paid on a mere five patents.

The full Forbes‘ list of the top 15 most successful tech transfer programs in 2006 is as follows:

1. New York University, $210 million in research expenditures, $157 million in research related income, 75% yield

2. Wake Forest University, $146.3 million in research expenditures, $60.5 million in research related income, 41% yield

3. Stevens Institute of Technology, $28 million in research expenditures, $4.56 million in research related income, 16% yield

4. Ohio University, $24 million in research expenditures, $3.26 million in research related income, 13% yield

5. Brigham Young University, $26 million in research expenditures, $3.07 million in research related income, 11.7% yield

6.  University of Rochester, $355 million in research expenditures, $38 million in research related income, 11% yield

7.  University of Minnesota, $596 million in research expenditures, $56 million in research related income, 9.4% yield

8. University of Florida, $459 million in research expenditures, $42.9 million in research related income, 9.3% yield

9. Stanford University, $699 million in research expenditures, $61.3 million in research related income, 8.7% yield

10. Northwest University, $348 million in research expenditures, $29.9 million in research related income, 8.6%

11. Mount Sinai School of Medicine, $269 million in research expenditures, $20.1 million resarch related income, 7.5%

12. University of Massachusetts, $409.9 million in research expenditures, $27.2 million in research related income, 6.7% yield

13.  University of Utah, $246.5 million in research expenditures, $16.3 million in research related income, 6.6% yield

14.  University of California System, $3.04 billion in research expenditures, $193.4 billion in research related income, 6.4 % yield

15.  University of South Alabama, $20.6 million in research expenditures, $1.2 million in research releated income, 5.9% yield

Forbes published an interesting article last week which named the universities in this country with the most successful tech transfer programs in terms of rate of return ("ROI"), according to a 2006 survey.

At the top of the list was New York University.  Forbes reported as follows:

[New York University] generates $157 million in research-related income on $210 million in research and development (R&D) expenditures–tops the list with a 75% yield. . . . While Remicade has generated the bulk of NYU’s licensing income in the last decade, some 20 other biomedical technologies kick off royalties as well–and 15 more are in clinical trials. . . . Other hot areas include computer science, agriculture and nanotechnology. NYU also takes stakes in start-ups, including Perceptive Pixel, developer of the touch-screen map that CNN uses in its election coverage.

Next on the list was Wake Forest University, which had a 41% ROI.  According to Forbes, Wake Forest’s success was due in part to several patents, which generated more than $1 million in licensing revenue and the development of several key technologies, including the V.A.C. System, a mechanical vacuum technology that promotes wound-healing, which was licensed to San Antonio-based Kinetic Technologies, and a virtual endoscopy machine, which was licensed to GE Medical, a unit of General Electric.

Other successful programs included the Stevens Institute of Technology, Ohio University, Brigham Young University, and University of Rochester.

Interestingly enough, the University of California System (which includes all of its various institutions and campuses around the state) only came in fourteenth on the list, even though it reportedly generates more in total revenue from research than all other U.S. universities.  According to Forbes, out of the University of California System’s $48 million licensing program, about $24 million was incurred from royalties paid on a mere five patents. 

The full Forbes‘ list of the top 15 most successful tech transfer programs in 2006 is as follows:

1. New York University, $210 million in research expenditures, $157 million in research related income, 75% yield

2. Wake Forest University, $146.3 million in research expenditures, $60.5 million in research related income, 41% yield

3. Stevens Institute of Technology, $28 million in research expenditures, $4.56 million in research related income, 16% yield

4. Ohio University, $24 million in research expenditures, $3.26 million in research related income, 13% yield

5. Brigham Young University, $26 million in research expenditures, $3.07 million in research related income, 11.7% yield

6.  University of Rochester, $355 million in research expenditures, $38 million in research related income, 11% yield

7.  University of Minnesota, $596 million in research expenditures, $56 million in research related income, 9.4% yield

8. University of Florida, $459 million in research expenditures, $42.9 million in research related income, 9.3% yield

9. Stanford University, $699 million in research expenditures, $61.3 million in research related income, 8.7% yield

10. Northwest University, $348 million in research expenditures, $29.9 million in research related income, 8.6%

11. Mount Sinai School of Medicine, $269 million in research expenditures, $20.1 million resarch related income, 7.5%

12. University of Massachusetts, $409.9 million in research expenditures, $27.2 million in research related income, 6.7% yield

13.  University of Utah, $246.5 million in research expenditures, $16.3 million in research related income, 6.6% yield

14.  University of California System, $3.04 billion in research expenditures, $193.4 billion in research related income, 6.4 % yield

15.  University of South Alabama, $20.6 million in research expenditures, $1.2 million in research releated income, 5.9% yield        

Biotech companies are running into roadblocks when they enter into deals with the UC System, according to a report this week by the San Francisco Business Journal. 

According to the San Francisco Business Journal, the key problem is that it simply takes too long to get the deal done.  The San Francisco Business Journal reported:

"Most of us would prefer not to work with" the UC System, [Don] Francis [chairman and executive director of the South San Francisco nonprofit Global Solutions for Infectious Diseases and co-founder of Vaxgen, Inc. of South San Francisco] said at a recent UCSF forum on product development partnerships

Francis recalled VaxGen’s late-stage AIDS vaccine trials that included UC sites. Because UC lawyers pushed for intellectual property rights for the system — though VaxGen had done the research and was only conducting paid-for trials at UC — agreements took months rather than weeks to complete, Francis said. In fact, UC was the last series of clinical sites to sign on. 

It’s fixable. . . . but unless changes are made, he said, UC will drive away companies.

The other significant problem, according to the San Francisco Business Journal, is that the UC leadership is just too risk-adverse.  The San Francisco Business Journal reported:

Deals must pass "the Chronicle test," said Jack Newman, a UC Berkeley graduate and now senior vice president of research at Amyris Biotechnologies Inc. in Emeryville. In other words, UC system lawyers want to be sure no one — those pesky media types, in particular — can accuse them of giving away too much value.

As an IP attorney who regularly handles deals with universities and companies in the private sector, my personal experience has been that deals with universities in general do tend to take an excrutiatingly long time to get finalized and signed.  Typically, the time period far exceeds the normal negotiating period in the private sector. 

Why is this? 

Well, in all likelihood, it is because the universities operate on a different timeclock.  Businesses are often anxious to get deals signed, so that they can move on to a different set of problems and concerns.  However, universities frequently operate on a different schedule and set of priorities–there just is not the same level of pressure to get the deal closed in a specific period of time that you have in the private sector.  I suspect that if you took a survey of all of the tech transfer offices around the country, you would find that the UC System’s turnaround time is fairly representative of what you find at other university tech transfer offices.

I would be interested in hearing from others of you in the blogosphere who have experience with doing deals with universities: what has your experience been with the turnaround time?  Has your experience been similar to mine or have you found that any particular universities are operating at a much faster timetable?  I will, of course, share any feedback I receive on this topic.