THE UNIVERSITY OF CALIFORNIA’S
RELATIONSHIPS WITH INDUSTRY
IN RESEARCH AND TECHNOLOGY TRANSFER
February 2000 Progress Report on
Priority Action Items Arising from the 1997 President’s Retreat
University campuses and Laboratories are increasingly called upon to enter into new and complex research relationships with industry in support of the University’s research, education, and public service missions. In response to these evolving relationships, on August 26, 1999 President Atkinson issued Principles Regarding Rights to Future Research Results in University Agreements with External Parties (see excerpt, below). The Policy delineates University principles regarding rights and obligations concerning research results arising from the full range of UC research-related relationships with external parties. It was developed in response to recommendations made by administrators, faculty and industry representatives who attended the President's Retreat in 1997. The policy was originally formulated by a systemwide Technology Transfer Advisory Committee (TTAC) working group that included representatives of Business and Finance and Academic Affairs in the Office of the President, and the Academic Senate. In addition to extensive campus, Laboratory and Senate review and input, the policy underwent review by the Council on Research, the Council of Vice Chancellors for Research, and the full TTAC.
The Principles Policy provides direction for the growing number of faculty and administrators involved in new forms of research relationships with industry and other extramural parties. It offers a basic framework that enables the University to maintain appropriate consistency in managing research results across the campuses and Laboratories while providing for greater flexibility in the local administration of agreements. In addition, the principles provide University negotiators with a basis to support positions taken during often challenging contract negotiations. Guidance is being developed to support the systemwide implementation of the Policy.
Excerpts from the Policy:
Principles Regarding Rights to Future Research Results
In University Agreements with External Parties
Preamble--This policy defines the core principles to be addressed in University agreements with external parties as to rights to future research results including patents, copyrights, tangible property, and data generated by the University community or through the use of University resources…
1. Open Dissemination of Research Results and Information
Agreements with external parties shall not abridge the ability of University researchers to disseminate their research methods and results in a timely manner. The most fundamental tenet of the University is the freedom to interpret and publish or otherwise disseminate research results in order to support the transfer of knowledge to others and maintain an open academic environment that fosters intellectual creativity.
2. Commitment to Students
Agreements for research relationships with external parties shall respect the University's primary commitment to the education of its students.
3. Accessibility for Research Purposes
Agreements with external parties shall ensure the ability of University researchers to utilize the results of their research to perform future research.
4. Public Benefit
Agreements with external parties shall support the ability of the University to make available for the public benefit in a diligent and timely manner any resulting innovations and works of authorship.
5. Informed Participation
All individuals involved in research governed by a University agreement with an external party shall have the right and responsibility to understand the rights and obligations related to future research results embodied within the agreement.
6. Legal Integrity and Consistency
Commitments concerning future research results made in agreements with external parties shall be consistent with all applicable laws and regulations and the University's contractual obligations to others.
7. Fair Consideration for University Research Results
Agreements with external parties shall provide fair consideration to the University and the general public for granting commercial access to future University research results.
8. Objective Decision-Making
When establishing or conducting University relationships with external parties, decisions made about rights to future research results shall be based upon legitimate institutional academic and business considerations and not upon matters related to the personal financial gain of any individual.
These principles shall apply to all University agreements with external parties that impact rights to University research results whether such agreements are administratively managed as contracts and grants, as procurements, as sales and services contracts, or as other forms of agreement.
2. An integrated approach to issues relating to outside professional activities and relationships, including conflicts of interest and involvement of students and postdocs
The University's array of policies related to conflict of commitment and conflict of interest were adopted over the years to address a variety of research, academic, and business regulations and procedures. While the policies had been appropriately updated, they had not been coalesced into a set of policies within an overarching principle. In response to a perceived need to review current policies and to respond to recommendations from the President's Retreat in the Spring of 1998, an Administrative Task Force was appointed by the President.
The Task Force was charged with assessing whether current policies are clear and comprehensive enough to guide faculty, staff and administrators in making wise professional decisions to achieve the appropriate balance between University and outside activities and to assure that there is no inappropriate entanglement of private interest and University obligations. The University's policies on relationships with industry in research and technology transfer and on student involvement in outside activities were also reviewed during the course of this study.
After reviewing and assessing the efficacy of present University policies, the Task Force decided to address these issues in two parts, issuing a first report in March 1998 that focused on conflict of commitment issues. While this report recognized that existing University policies and guidelines provide the necessary oversight for a majority of activities, the Task Force recommended the following be considered:
The Office of the President has been working with a subcommittee of the Academic Council to prepare a draft revised Academic Personnel Manual (APM) Policy to incorporate these recommendations; a first draft of revised APM 025 is expected to be issued for wider campus review in the near future.
The Task Force's second report was submitted to the President on December 7, 1999. It made recommendations in four complex areas with a potential for conflict of interest:
3. University policy guidance on what is an appropriate academic enterprise
University Regulation 4 (Academic Policy Manual 020), issued in 1958, presents the basic principles that determine the appropriateness of activities and services that the University provides to industry and addresses the conditions under which such activities and services may be conducted by the University. According to Regulation 4, it is appropriate for University faculty members to participate in tasks and investigations which lead to the extension of knowledge or to increased effectiveness in teaching. Routine tasks of a "commonplace type" and tests of a purely commercial character, however, are precluded. Work is to be conducted so as to be generally useful with the right of publication reserved to the University; results of the research are to be the property of the University; and sponsors must pay all direct and indirect costs of a project.
At the President's Retreat, an advisory group proposed revision of Regulation 4 in response to the University's expanding research relationships with industry. It was determined, however, that such revision should await the final report of the Administrative Task Force to Review Policies Pertaining to Outside Activities, Conflict of Commitment, Conflict of Interest and Related Issues and final revision of the related Academic Policy on Outside Professional Activities of Faculty Members (APM 025).
Issuance of the final report and the APM revision will establish an integrated approach to faculty’s outside professional activities (see item 2 above) in policies pertaining to conflict of commitment and conflict of interest. Revision to APM 025 is now nearing completion and a proposed revision of Regulation 4 will be circulated to Chancellors, Lab Directors, and the Academic Senate for their consideration in 2000.
4. University/Industry Visitor Exchanges
In recent years, the increase in the University’s general interactions with industry has led to an increase in the number of industry visitors involved with research activities at University facilities. One particularly challenging aspect of industry visitors conducting research at the University concerns the appropriate treatment of resulting intellectual property. During 1999, the systemwide Office of Technology Transfer (OTT) worked with the Technology Transfer Advisory Committee (TTAC), Patent Coordinators and Contract and Grant Officers across the system, and individual faculty, deans, and visitors to consider how best to resolve individual visitor patent issues, and address visitor intellectual property matters more generally to ensure "fluid" interface between industry visitors to University laboratories and University visitors to industry laboratories.
University policy requires that all persons employed by the University and all non-employees who use University research facilities and/or receive gift, grant, or contract funds through the University execute a University Patent Acknowledgement agreeing to assign rights in inventions and patents to the University. Experience has shown that some visitors are uncomfortable with or refuse to sign the standard University Patent Acknowledgement. The most common reasons given by visitors for this reticence is the potential breach of prior obligations to their primary employer. Participants in the January 1997 President’s Retreat concluded that this University policy tends to interfere with some University/industry interactions and is ignored by some University faculty and visitors. University employees and students encounter comparable dilemmas when they visit industry research laboratories. While a recommendation arising from the Retreat called for revisions to University policy to address this problem, this is a challenge that eludes a "one-size-fits-all" solution. In the coming year, OTT will continue to work closely with campuses to manage individual visitor arrangements as they arise and pursue systemwide policy and model agreement solutions in this area.
5. Engineering Initiatives
The President's Engineering Advisory Council (PEAC) was re-established in 1996 at the request of the Engineering Deans after a decade hiatus, to provide guidance to the President on engineering education at the University, to provide insights into developments in the high technology industry, and to advise on how the University may appropriately further develop this critical industry sector in the California economy.
In December 1997 the Council strongly recommended that the University increase the number of engineering and computer science graduates. This recommendation resulted in an increase of an additional $6 million in state support for educating an additional 800 students per year from 1998-2006.
The Council more recently has focused on ways in which UC's research contract negotiation process might be streamlined. At the June 1999 PEAC meeting, there was discussion of an optional mechanism for both industry and the University to agree not to pursue ownership of intellectual property developed under an industry-sponsored project. The intent was to find a way to reduce the amount of negotiating time in fast-moving sectors in which rapid technology transfer is a competitive advantage for companies. This approach was subsequently articulated in a proposal that was analyzed by the Office of the President resulting in a recommendation that a task force be formed to explore the proposal in greater depth. The UCOP analysis was accepted by the Technology Transfer Advisory Committee in September and a task force has now been established. Its preliminary findings will be shared at the March PEAC meeting. Advice and comments from PEAC will be conveyed to the Technology Transfer Advisory Committee.
6. Campus and Faculty-Centered Licensing Programs
Today, the University technology transfer program is thriving under a "distributed" model. Each campus and Laboratory has worked with OTT to develop a unique technology transfer program suited to its goals, resources and desire to take on particular responsibilities. During 1999, the initial five-year "pilot" periods for the campus-based technology licensing programs at San Diego and Irvine were completed. In recognition of the success of the programs, licensing authority was extended indefinitely. Los Angeles changed its programmatic relationship with the OTT to a cooperative model, whereby OTT will assume greater responsibility for managing patenting, licensing and accounting activities on behalf of the campus. Finally, last year the Davis campus was delegated interim licensing authority to its local technology transfer program. By the end of 1999, individual programs to carry out the licensing function in close proximity to the faculty and other academic researchers had been firmly established on six campuses (Berkeley, Davis, Irvine, Los Angles, San Diego and San Francisco) and at all three University-managed DOE Laboratories. Policy and legal support and a variety of other technology transfer infrastructure services continued to be provided for the entire University system by OTT in the Office of the President.
The majority of the campus offices reported increases in key technology transfer measures associated with discoveries from University research with the potential to be developed into new products and processes serving the public benefit. In fiscal year 1999, the University received 818 invention disclosures, added 281 new U.S. patents to its portfolio, entered into 219 license and option agreements, and received $88.9 million in total licensing revenues associated with its patent program. The University of California was once again identified as having generated more technology transfer revenues than any other university technology transfer program according to the national survey conducted by the Association of University Technology Managers (AUTM).
UC-managed DOE Laboratory technology transfer operations also reported increases on key measures. A total of 405 new inventions were disclosed at the Laboratories, 157 U.S. patents were issued related to inventions in the laboratory portfolios, and 40 licenses and options were executed. Total royalty and fee income for the Laboratory patent program surpassed $2.7 million.
7. Organization, staffing and accountability for research interactions with industry
The issuance of a University policy structure for managing research results to support greater local flexibility in the negotiation of agreements with industry makes it imperative for the University to establish appropriate organization, staffing and accountability related to this function. University employees charged with developing relationships with industry must possess special traits, experience, and capabilities if the University is to be successful. These individuals must have a strong technical and subject-area background, experience in negotiating with industry, and knowledge of intellectual property issues and the interests, principles, and organization of the University. In addition, local organizational structures and staff responsibilities should ensure that sponsored research, technology transfer, licensing, conflict-of-interest, and related functions are appropriately integrated.
In February 2000, Senior Vice Presidents King and Kennedy appointed an ad hoc Task Force charged to:
In fiscal year 1999 the Office of the President entered into several significant systemwide "master agreements" in which the management of intellectual property and other research results had a broad positive impact across the University community. One was with DuPont Pharmaceuticals Company enabling broad use of a genetically-engineered mouse ("Cre-lox technology") in UC research. Before this agreement was executed, UC researchers who needed this animal model were precluded from using this research tool because of intellectual property "reach-through" provisions associated with its use. Another was with Affymetrix, a small biotech company that is the primary supplier of probe array chips used in genomic research. The chips had been in great demand by University researchers, but had not been widely available due to the prohibitive cost and problematic intellectual property provisions.
8. Systemwide Web and database services to support University faculty/industry relationships in research and technology transfer
Recent advances in electronics and telecommunications, exemplified by the exponential growth of the World Wide Web, have created opportunities for new computer-based tools to further University research and technology transfer relationships with industry. During 1999, there was continued support of the development and implementation of a range of databases and web-based resources related to this area.
Companies throughout the world used the systemwide Office of Technology Transfer home page to access the comprehensive database with abstracts of federally-supported UC research in progress. Industry representatives use this database, updated monthly, to locate University faculty for research collaborations and sponsored project support. Searchable information on University organized research units, centers, and institutes is also included on this site. In addition, this site affords companies the ability to search for technology licensing opportunities from UC campuses and Laboratories.
Another group of newer database tools provides access to information on the University’s research and licensing relationships with various companies. These tools are available under restricted-access via the Web and can be used, for example, to help the University avoid entering into agreements with conflicting intellectual property commitments. In 1999, this group of resources was expanded to include a database that enables UC personnel to assess patent right, copyright, and data right obligations pertaining to non-profit sponsors (some of which are industry affiliated) that have provided research funding to the University.
During 1999 other database-related activities were initiated to support a more complete understanding of the breadth and depth of the University’s relationship with industry. One was a modification of the Corporate Contracts and Grants System (CGX) to support tracking clinical trials. This will enable the University to better assess how much University industry-related funding is associated with clinical trials as compared to other research activities. CGX was modified to allow tracking material transfer agreements (MTA’s) with industry. In recent years, the negotiation and execution of MTA’s has become increasingly important to the University of California research enterprise. Finally, work began on two freestanding databases with implications for assessment of the economic and societal impact of the University’s relationship with industry. One includes information on start-up companies dependent upon UC-licensed technology for their initiation. The other database tracks products that have been developed based upon UC-patented technology.
In the coming year, efforts will be directed at enhancing the quality and impact of these databases and Web-based resources, and encouraging their broader use through marketing activities. Plans are underway to develop Web interfaces to make it easier to locate the full range of University’s electronic resources related to industry/University research and technology transfer, and to navigate more successfully through the University's organizational and programmatic complexities.
9. President’s Industry-University Cooperative Research Program (IUCRP)
President Atkinson launched the Industry-University Cooperative Research Program (IUCRP) in 1996 to accelerate the contributions of university research to the California economy. The program has rapidly grown from $3 million annually in January 1996 to more than $60 million annually in fiscal year 2000 ($21.6 million State, $3 million UC, $40 million industry). It is expected to grow further during the next two years.
The IUCRP is guided by the President’s Board on Research and Economic Development, which is comprised of leading representatives of California’s high tech, biotechnology, agriculture, and healthcare industries. This group advises the President on opportunities for advancing university research in the service of the California economy.
Five strategically targeted matching grant programs have now been created to address research partnership opportunities in biotechnology, communications, digital media, life science informatics, and semiconductor manufacturing. Together with the MICRO Program, established in 1981 to promote microelectronics research partnerships, these programs are catalyzing the development of hundreds of new partnerships every year between university scientists and California’s entrepreneurial industries.
More than half of participating companies are small businesses and many are start-up firms, with fifty or fewer employees. By participating in the program, these promising young firms significantly leverage their R&D investments and create a "virtual" research capacity in partnership with university researchers that they could not afford to build in-house. In addition, the program provides mechanisms for timely and efficient negotiation of research agreements that reduce transaction costs for all parties.
Nearly one fourth of participating university scientists are assistant professors, representing California’s next generation of leaders in academic science and engineering. Hundreds of students each year participate in the supported research, gaining exposure to the interests and problems of California industry and becoming familiar with future career opportunities in the state. All of the supported research is early stage and priority is given to multidisciplinary projects that move university programs in entirely new directions.
10. California Institutes for Science and Innovation
Governor Davis has proposed the creation of three California Institutes for Science and Innovation located at University of California campuses. Each Institute would focus on scientific and engineering research in a sector key to the future of the California economy, bringing together faculty, undergraduates, graduate students and business partners to work in cross-disciplinary teams aimed at developing the next generation of knowledge in the field.
UC strongly supports this proposal to foster scientific and engineering research to broaden the frontiers of knowledge and provide the foundation for California’s continued competitiveness in the technology-based global economy. The Institutes would provide educational programs for undergraduate and graduate students to help train the state’s next generation of scientists and technological innovators.
These Institutes would be designed to foster technical breakthroughs in areas where the complexity of the research agenda requires the advantages of scope, scale, duration, equipment and facilities that a comprehensive center can provide. Each Institute would engage corporate entities as partners in collaborative research to ensure cross-fertilization and cultural exchange in education and research, and to introduce students to the culture and objectives of industry.
The governor’s 2000-01 state budget proposes $75 million for the Institutes for Science and Innovation. State funding would be matched by funds from private and federal sources on a 2:1 basis. If approved by the Legislature, planning and development would begin in the 2000-01 fiscal year.
Specific UC institute sites would be selected through a competitive process. Campuses could collaborate on individual proposals, and a single campus could submit more than one proposal. Only one institute could be located on a given campus, however.
Governor Davis indicated that proposals in various fields would be considered, among them medicine and bioengineering, telecommunications and information systems, energy resources, and space and agricultural technology.
11. The University’s contribution to the State’s economic development
A small group of UC faculty and administrators from throughout the University met during 1998 to define a framework for articulating the University's role in economic development. The draft report, "UC and the Twenty-first Century Economy," addresses the role of a public research institution in economic development, highlights current activities from around the system, identifies metrics to assess the economic impact of the University, and suggests new initiatives and mechanisms to put knowledge to work more effectively for the economy and California’s citizens. The report will focus on six areas: innovation and knowledge creation, collaborative initiatives, technology transfer, workforce development, policy analysis and information resources, and regional engagement. These are all dynamic areas at UC and they can be encapsulated and promoted as a key component of UC’s service to the state. A revised framework report and supporting data and case studies will be completed during 2000.
12. UCSD Joint Senate-Administration Committee on University Interaction with Industry.
For the past 18 months, the San Diego campus has been reviewing policies and practices related to university interaction with industry. In July 1999, a Joint Academic Senate-Administration Committee on University Interaction with Industry issued its report. The report describes the benefits of university interactions with industry and identifies local guiding principles for interactions with industry, makes recommendations about a range of topics (conflicts of interest, conflicts of commitment, involvement of students and postdoctoral scholars in industry activities, appropriate use of university facilities for industry-related purposes, guidance to the UCSD community about appropriate interactions with industry, facilitating better interaction and communication with industry, and an organizational structure for overseeing and managing UCSD interactions with industry).
In Fall 1999, the report was reviewed by the San Diego Division of the Academic Senate. In 2000, a meeting will be held among key administrators and Senate leadership to discuss the report’s principal recommendations and develop a plan to move forward.
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