Strengthening the Technology Ties Between Universities and Industry

Thursday, November 29, at 12 noon, U.S. Eastern time

Arundeep S. Pradhan is director of technology and research collaborations at Oregon Health & Science University. He has testified before Congress that the law is critical to maintaining university-industry relations. If anything, he argued, the law should be strengthened by including greater oversight from the executive branch over its enforcement. Before going to Oregon, he was director of technology transfer at the Colorado State University Research Foundation. He also worked at the University of Utah as associate director of technology transfer.

A transcript of the chat follows.

Dan Carnevale (Moderator):
    Welcome to another installment of the Brown Bag. This is an important topic, and we appreciate the time Arundeep Pradhan is taking to answer our questions. Now let's get started.

Arundeep S. Pradhan:
    On the topic of university-industry relations, I have always maintained that a successful relationship is established when both parties understand the needs of each other and the opportunities, skills, expertise and constrains that each bring to the table. There are a number of things that each sector can do better to understand these issues such as the culture and needs of the respective parties; the role of federal and state regulations; non-negotiable costs such as the F&A rates; pre-valuation of results or intellectual property that has yet to be created; separate negotiations for collaborations and intellectual property; conflict of interest issues for faculty and institutions; academic freedom rights; the obligations to provide companies with the end-product of the research project. These issues vary for industry sectors and we as universities need to recognize this and be willing to be flexible.

Question from Rosanna Diaz, CCL DOC 1, National-Louis University:
    How can community colleges apply some of the lessons learned from university public-private partnerships in regard to developing innovative programming?

Arundeep S. Pradhan:
    I believe that community colleges have a lot to offer. From participating in work-force development in partnership with industry to research collaborations with universities and companies that leverage the unique expertise present at the respective institutions. One example would be as simple as providing testing services to companies in various fields. The innovative programming that you are referring to necessarily involves strategically positioning your institution and others in your network to provide services/programs/training that is not available. This would leverage your core strengths and would require strategically investing in those programs that you think would pay-off in the long term.

Because community colleges are different that universities from a research perspective, you can build on that difference. At the university level, research collaborations usually result from one-on-one interactions at the scientific level. We try to facilitate this interactions among other things, inviting companies to make presentations (scientific) at the institution. Also, are there any incentives or disincentives (perceived or actual) in faculty working with companies.

All of this depends on the type of program that you are trying to define - research, training, testing...because the respective needs of the institution as well as the company vary with each.

Question from Dr. S.V. Char, Business Department, Life University, Marietta, GA:
    Academic researchers undertake R&D efforts in an unhurried manner and should not be rushed just because the National Science Foundation or any Government agency has funded the research. At the same time there has to be accountability for the expenditures incurred, because eventually the government is accountable to the tax-payers. Not all R&D institutions in Universities can be expected to be a Thomas Alva Edison coming up with an invention or discovery regularly. Depending upon the field of research it could just be serendipitous or more easily foreseeable in a given time-line. In view of this, what is consequential would be for the parties concerned to sit down and agree on different scenarios ranging between prolific inventions and low productive research. The R&D outcomes could be so different as between say biology and electronics. No cookie cutter solution would do justice to the question of ensuring successful collaborations.

Instead of amending the Bayh-Dole Act or tinkering with superficial factors, is there really any alternative to pre-R&D agreements based on "Best Practices" agreements between say funding agencies, in the public or the private sectors and the University R&D divisions, such agreements notched to the nature of research and the discipline?

Arundeep S. Pradhan:
    I could not agree with you more regarding the nature of the research funded through most federal agencies. The focus of research tends to be basic and builds on years and decades of knowledge that has already been established in the field. The primary objective is to further our understanding of basic mechanisms and therefore any inventions are a usually a serendipitous result of that activity. Add to this the complications of varying business models in different industry sectors, product life cycles and the approaches toward intellectual property, and it becomes obvious that a "cookie-cutter" approach cannot be applied.

The approaches that are successful in my opinion are those where the parties first sit down with each other and articulate what they are looking for out of the relationship (as opposed to exchanging boiler-plate agreements that go straight to the respective attorneys). Once each party has an understanding of the principles around which the collaboration will exist, the agreement drafting is usually reduced significantly.

Question from Dan Carnevale:
    How would you describe the relationship between university research and industry, and what has helped foster that relationship?

Arundeep S. Pradhan:
    I believe that the relationship is largely positive both nationally and internationally. Managing the relationship due to the different drivers (cultural, economic, time) is sometimes challenging, but at the end, rewarding for both the university sector as well as the industry sector.

There are probably several factors that foster this relationship, among which is the recognition of the different expertise that each sector brings to each other, and sharing of economic reward when there is a "successful product"

Question from Dan Carnevale:
    What changes would you suggest making to the Bayh-Dole Act?

Arundeep S. Pradhan:
    The Bayh-Dole Act is as valid today as it was when passed. I have no suggested changes to the Bayh-Dole Act.

Question from Eliza Evans, Univ of Texas:
    What is the status/outcome of the NAS Turbo Negotiator project?

Arundeep S. Pradhan:
    The NAS Turbo Negotiator project is being developed through the University-Industry Demonstration Partnership. I believe that the intent of the tool was to speed negotiations between two parties. As I have not been involved in this development, I cannot comment as to its status. However, given that most projects cannot follow a "cookie cutter" approach, that the turbo-negotiator model might be limiting as to the types of projects to which it can be applied.

Question from Ellen Schrecker, Yeshiva U.:
    What are the academic freedom issues at stake in these collaborations? And how can they best be resolved?

Arundeep S. Pradhan:
    The primary issues that arise are the rights to publish the results of the research. It is usually the details on this that tend to bog us down, with companies requiring that they "approve" all publications. An acceptable compromise is to give the opportunity to the company to review the publication (and remove company confidential information) and provide for a nominal delay so that appropriate patent applications can be filed - which is an acceptable business practice and has been a part of the the approach that universities have with industry for at least the last 20 years.

A second issue is the perspective that companies control the research that is conducted in the particular lab or project. To some extent this is true, and acceptable, because at the end of the project the companies to need to justify their expense and effort in achieving their objectives.

Both these issues are easily resolved by agreeing up front to mechanisms that are acceptable to both parties it the form of review of publications, and progress reports to the company.

Dan Carnevale (Moderator):
    We're about half way through the chat. Keep those questions coming.

Question from Jeffrey Brainard, Chronicle of Higher Education:
    Some university officials have suggested that their institutions should ensure that live-saving cures and other discoveries developed with corporate sponsorship be available at affordable prices to poor people in developing nations. How can universities enforce such contractual language? How do academic institutions monitor price and availability there?

Arundeep S. Pradhan:
    There is no easy answer to your question. My office has at various times negotiated various agreements that have provisions to address the issues that you bring up. The bottom line - it can't be unilateral. For example, sliding scale royalties for sales in developing countries, or even 0% royalties where the company commits to providing treatment at cost or below cost.

With respect to monitoring and enforcement - it's an issue of relationships and trust. You have to be willing to trust that the other party is going to live by the terms of the contract that you negotiated - most agreements have an audit clause which I would highly recommend using. The pricing and availability is another issue where the audit section could be used to addressed as well.

Question from Stephana Colbert, Temple University:
    What is the greatest challenge for private industry in understanding academia and therefore fostering a better relationship between the two; and what is the most important aspect of private industry for academia to understand? Finally, is it inevitable that some schism between the two will always exist, and if so, how can the two continue to move forward in spite of that schism?

Arundeep S. Pradhan:
    I would not describe it as a schism. The academic research and industry research sectors are just different. There are different drivers for success (publications; graduate students; education; basic understanding; time scale of projects; ownership of intellectual property; cost of doing research; product development; return-on-investment). There should probably always be a natural tension between the two. Are there things that each sector could do better to address the other? Yes. Will this affect the nature of interactions over the long term? Probably not.

Of the drivers that I mentioned above the most negotiated are the cost of doing research, publications, and ownership of intellectual property. The relative importance of these tends to vary by industry sector and represent the greatest challenges from both the industry as well as academia.

Question from Kelly Downing, Univ of Pittsburgh:
    You mentioned previously the concept of "pre-valuing" intellectual property. If you are familiar with the tax exempt bond financing issue (IRS Rev proc 97-14, 2007-47) can you comment on the impact you feel it has on industry funded sponsored research, if any?

Arundeep S. Pradhan:
    I don't believe that this has had a significant impact over the long term. Most universities or business for that matter would not pre-value something that has yet to be created. As a matter of good business practice it is something that I would not recommend. In addition, one instance of misuse under this has the potential to jeopardize the status of the bond and/or subject the institution to tax implications to which we just do not want to open the door.

Most companies want an assurance that the terms that would be offered at the time that the IP is created are reasonable and there is contractual language that can be used to address their needs. From a personal viewpoint, I have never had a company walk away due to this provision.

Question from Dan Carnevale:
    How does tech transfer differ in America than the rest of the world, especially Europe? Does this country have a comparable advantage or disadvantage?

Arundeep S. Pradhan:
    There are similarities as well as differences. 20 years ago, the US was ahead of the curve. I don't think we can make that statement any longer. In Europe, Japan, Singapore, China, India, there is a growing recognition of the role that research plays in the innovation economy and therefore an increase in the amounts of research funding as well as infrastructure that supports it (vs. flat for the US in the last few years).

Within Europe, the UK, Ireland, Germany are instituting innovative approaches from which we could all learn and adopt practices that make sense. In the US, we've seen greater support for research infrastructure at the state govt. level. Globally the US is still a significant player in the research and technology transfer arena.

Dan Carnevale (Moderator):
    That's all the time we have for today's chat. Thanks again to Arundeep Pradhan for answering all our questions. We really appreciate his insight on this topic.

Dan Carnevale (Moderator):
    Please join us next week when Jan Greenwood, a search consultant, will discuss some of the tricks of the trade.

Arundeep S. Pradhan:
    I would like to thank everyone for the insightful questions, and hope that I answered them to your satisfaction.

There are no doubt challenges that we face in trying to bring two highly different cultures (academia and industry) together in working on projects. I believe that this is our strength and that we should not try to make universities and industry more like each other.