Commercial science

I have already commented on the interesting posts by Stephen Quake on the interface between academic science and commerce. In his latest column, Quake comments on how universities manage potential conflicts of interest:

[DDET Read on]

Faculty members with financial interests in their research must disclose such interests through a “conflict of interest” (COI) process. The federal government has up to this point taken a fairly sensible position about COI in the grants they fund: they require conflicts to be disclosed by the faculty and “managed” by the university – but don’t prescribe a particular method.

Unfortunately, this has encouraged universities to create a bureaucracy to “manage” COI – often by meddling into faculty research in ways that create more heat than light. These COI bureaucracies often overlook the solution that has been arrived at by the scientific community: disclosure and peer review of all publications. Peer review is the bedrock value of the scientific community and although it certainly is not perfect, it is, to paraphrase Winston Churchill, “the worst system, except for all the others that have been tried.”

When this bureaucracy asked me for a plan to manage conflicts in my own research, I wrote one that described all of the steps involved in peer review – and the COI committee sent it back as “too much.” In their view the process that scientific publications go through was more rigorous than necessary.

He goes on:

Interestingly, it is not unusual for basic scientists with no commercial relationships to be dependent on grants for their salaries and therefore have a significant personal financial interest in preserving their grants. Although COI experts have assured me that that this is not a conflict that needs to be managed, I must confess that I have some difficulty with the distinction they are trying to draw. Who is under greater temptation to bias the results of their research: the financially comfortable academic entrepreneur, or the ivory tower scientist who may not be able to pay his mortgage if his grant is not renewed? Perhaps all financial conflicts should be treated even-handedly.

Then there is a discussion about actual university commercialisation:

Licensing is often a protracted process, and licensing officers so paralyzed with fear about making a mistake and not maximizing licensing revenues that they discourage all but the most persistent licensees. Because universities are non-profit institutions, the true measurement of technology transfer success should not be the total amount of licensing revenue, but rather the successes in helping faculty members patent inventions, in forming new ventures that create jobs, and in facilitating the commercialization of technologies that in many cases will help improve our society.

The best way for universities to achieve this would be to make the same decision the federal government did, and relinquish their control over licensing. Since in most cases faculty know the context of their invention and how it can be best commercialized, they should drive the licensing process, and the OTL should play a supporting role. The university deserves to receive some compensation, but this should be fixed by a simple formula and limited — bearing in mind that the vast majority of research funding that leads to inventions has been obtained by the faculty through grants, and that the university has already taxed a fair bit of that to support its facilities.

I thought of all this stuff about University meddling as I listened to a talk the other week from a noted Australian scientist who described how the University of Melbourne used to make it nearly impossible for academic entrepreneurs to commercialise potential innovators and then for a brief period assigned ownership to them and kept their hands off. That apparently led to a great deal of commercialisation before the University reverted back to the high transaction cost model.

[Update: Actually, there is some ambiguity as to whether the policy of assigning ownership to academics really worked at the University of Melbourne; which is why they abandoned it. Other reports suggest that the current policies are working better. Sounds like an interesting area for further study.]