Professors' privilege: When to be greedy and when to share

A key distinction between physical and intellectual property is that the value of the latter is created as much by sharing it as by owning it. How to share it, between creator and enabler, is a particularly acute issue within the academic environment - as indicated by a recent, noteworthy debate on the subject in Sweden.

On the one hand, universities seek to attract the best and the most productive people, who as part of their research, sometimes generate IP with considerable commercial potential. How much of it is due to their personal drive and how much to the broader support of the university? This question is not only one of equity: a university is not an investment bank and cannot tolerate too great a disparity of income among its staff. It is also one of responsibility: if IP is controlled by its inventor, he or she is responsible for its business development.

On the other hand, if the university takes over ownership of the IP, it should also assume the responsibility for its exploitation. This supposes that the university has the resources and the business know-how, which is not always the case.

This is a dilemma faced by Swedish R&D policy-makers. Sweden's system is based on what is called the professors' privilege, the right of academics to fully own the IP of their research, inventions or patents. As part of a continuing review of its R&D policy, where Sweden is the acknowledged European leader, some experts began to question the professors' privilege. The rationale for this questioning was that most other countries have abandoned the privilege in favour of university ownership. This has been the case for some time already in the major US universities; and in Europe, most countries, including Germany and the UK, have been moving in this direction.

Yet, after a careful analysis, the Swedish Governmental Agency for Innovation Systems (VINNOVA) published in 2003 a report coming up against a wholesale abolition of the professors' privilege. This view echoed a large consensus of the academic community, particularly in biotechnology, which overwhelmingly supports the current system. It also reflected a realistic assessment of the current capacity of Swedish universities to assume the full responsibility for commercial development and exploitation of IP. In the US, major universities have been operating for several years quite large technology transfer teams, which have accumulated considerable expertise and experience. Similarly, in the UK, most successful universities, such as Cambridge or Imperial College, have been dedicating substantial financial and managerial resources to IP exploitation.

The Swedish government was initially tempted to abolish professors' privilege. However, following the VINNOVA report and the evaluation of the costs of alternative policy, it appears to have second thoughts. In addition to budgetary constraints, policy-makers are coming around to a view that it is better not to fix what is not really broken. Swedish universities may not be performing as well in technology transfer as the major US universities. But in sectors such as biotechnology, they are doing better than counterparts in most other EU countries. It is therefore far from proven that a new system will result in dramatic improvement. To the contrary, it could trigger a risk of greater bureaucracy and discouragement of individual initiative.

In this area of Intellectual Property, like in others, general one-size-fits-all approaches do not work. There is not substitute for pragmatic, local, case-based solutions.