Commercialization of Federally-Funded Research

| July 14, 2010

According to a recent Nature News article, two-thirds of businesses started by professors at US institutions are created without patentable knowledge. The remaining one-third of the 11,572 respondents set up their businesses “to exploit patents obtained through formal university intellectual-property systems”. While the lack of patents might be expected in social science academic ventures, non-patentable knowledge is being used to start biomedical and physics-based businesses. The implications of this study are:

  • Academics are realizing findings that aren’t patentable by universities can be commercialized.
  • Many of the businesses being started will provide no financial return for the institution since they aren’t based upon patentable material owned by the university.
  • Academic entrepreneurial activity may be underestimated because many university and government surveys measure activity through use of patents.
  • University technology-transfer offices (TTOs) are “failing to help a sizeable proportion of academic entrepreneurs” because they focus on formal intellectual property transfers.

This study will help the US government as it attempts to “shape its policy on the commercialization of federally funded research” and encourage technology commercialization. Critics argue that the US government first must repeal the Bayh-Dole Act that encourages universities to patent government-funded research because it stifles research. According to a study of the Bayh-Doyle Act:

“The monopoly powers granted to them under patents to prevent important basic research, driving up costs and slowing down innovation. Researchers are now less likely to share information, which has always been an important part in moving important research forward and figuring out how to build on each other’s research for practical applications.”