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THE financial stress Facing many British universities encourages them to seek new sources of money. Here is the bad news for those who hope that the research spin-outs on technology and life sciences will fill the gap: not only are they likely to be disappointed, but they could also miss a long-term opportunity.
Do not believe me, but listen to Anne Lane, who directs UCL Business, the technology transfer operation of the University College of London. The UCL is in the “gold triangle” of research universities connecting London, Oxford and Cambridge and is among the most successful to commercially take advantage of the inventions of science and health care that came out of its research.
Last year, UCL activities contributed to 6 million pounds of university sterling and gained another 18 million pounds of income from inventions such as technology behind Roctavian, a treatment of gene therapy of hemophilia A. It currently has 95 active spin-out and 24 advanced therapies based on clinical trials. It is not, in other words, a financial timing treatment.
But this is still modest compared to the income of the UCL of 2.1 billion pounds sterling last year, or inside this, its research subsidies and contracts of 538 million pounds sterling. “The academics want to get involved because it gives its work on an impact on the real world. If someone hoped (entirely) financial research with spinuts, it would be a long wait, ”explains Lane.
Or listen to Lord Jim O’Neill, president of Northern Grimstone, the partner investment fund of 312 million pounds sterling in Leeds, Manchester and Sheffield universities. Universities “need to appreciate how risky business is and do not hope for a guaranteed flow of income … if they try to dominate equity and control all intellectual property, they will not be able to attract investors.”
The good news is that in spite of the financial challenges faced by universities and the fact that many appear behind the opportunity to marketing research, it exists. Once a few bets on technologies are transformed into an ecosystem in which researchers from a university can easily and coherently transform ideas into companies, it begins to become anchored.
The more the short -term expectations of a university are modest and the more it is agile in rotation or license of its intellectual property, the more it ends up winning. “It is better to take a little bit of everything than trying to play venture capital,” said David Grimm, partner of Albionvc, who collaborated with UCL on two investment funds.
Universities recognize this, encouraged by a magazine in 2023 of Spinuts co-directed by Irene Tracey, vice-chancellian of the University of Oxford. A recent study by the research group, Beauhurst, revealed that participations in universities in spinutia fell to a lower 16%. This opens more equity to inventors and investors.
Taking less equity and adopting a standard model rather than negotiating individually and slowly on each potential invention brings two advantages. The first is that it promotes a larger scale, especially alongside partner investment funds. The second is that he gives a university a tangible economic role and attracts researchers who prefer to combine pure and applied research.
A single size does not correspond to the range of scientific and technological research in institutions such as UCL. For software and artificial intelligence, commercial ideas must be developed by entrepreneurs to have real financial value. For life sciences, molecules and therapies that emerge university laboratories can have a patentable and lasting value.
Thus, the UCLB adopts a very open approach to the spin-out of software, encouraging anyone with an idea of a business to develop it and license its right for 5% of equity. For drugs, it tends to keep larger participations or work with academics to obtain an intellectual property license in biotechnology societies, which is less risky and offers a flow of income from fees.
The fact that the UCL has a technology transfer office used. Last year, the reflection group criticized the offices of many universities as lacking in financing, capacity and expertise. The higher the university operation, the more likely it is that it works well with investors and to finance concept proof for potential benefits.
There are therefore many reasons for universities to take spin-offs seriously and to allow partner funds such as Northern Grimstone. Forget to try to fill a hole in the budget and focus on making more committed and inventive universities. He will pay in time.
John.gapper@ft.com