Mind to Matter: More on the Milken report

Milken Institute, a California-based think-tank founded by famous financier Michael Milken, published earlier this week a report on global trends in university biotechnology transfer. This is an impressive piece of work, carried out by a research team of nine and drawing on every conceivable source of data. It is must reading (and downloading) for anybody seriously interested in tech transfer in general and biotech transfer in particular. The report received a home page treatment in S/B so I am not going to dwell in detail on the rich content and findings of the report except to make four remarks.

1. The report highlights the extreme skeweness of tech transfer results. Business analysts often quote an 80/20 rule for market and revenue shares: 80 per cent of revenue is generated by 20 per cent of products, or 20 per cent of firms control 80 per cent of the market. University tech transfer, or UTT, looks more like 95/5 territory, particularly as far as results are concerned. Whether one looks at patents, innovation pipeline, new companies launched or licensing revenue, biotech UTT is heavily concentrated in a few elite universities: MIT, the University of California (UC) system, Stanford and Caltech. This finding corroborates other empirical studies. For instance in their NBER 1998 research, Lynne G. Zucker and Michael R. Darby found that in the US the top 100 producers of patents probably have 98 per cent of all the academic patents.

2. It would appear that excellence is cumulative and experience-based, even in the world of major intellectual shifts and rapid scientific evolution.  Thus, the UC system has already established a strong position in nanotech.

3. UTT strength appears closely related to the excellence in basic underlying sciences and disciplines (biology, genetic, medicine). Specific UTT expertise may be important but the science provides the necessary foundation. The competitive advantage of elite schools comes from their ability to combine both.

4. While the US part of the report is highly analytical, the "rest of the world" is descriptive, highlighting again the data gap. In a European overview of country profiles, I found a useful table (p. 140), showing two regimes for assigning IPRs at public research organizations, a topic I touched upon in an earlier blog. I am glad to see that the Milken report does not draw any conclusions about the superiority of one regime over the other but this may be due more to the lack of data than to the analytical probing.