How to bridge the Valley of Death

To bridge the Valley of Death: ensure research is properly prepared for commercialisation. And the way to do that? Take the responsibility for technology transfer out of the hands of universities and place it with independent, commercial bodies that have the requisite commercial skills.

This is the view of leading scientist and entrepreneur Greg Winter, who made the case as one of the 130 individual researchers, industrialists, entrepreneurs, movers and shakers of science policy, companies from start-ups to multinationals, funding bodies and other organisations, that gave evidence to a UK Parliamentary Science and Technology Committee investigation into the Valley of Death.

The Committee’s report, published last week, concluded the UK does not have a coherent strategy for commercialising publicly-funded research. For Winter, a major issue to be overcome is that translating publicly-funded research into the commercial arena is entrusted to the universities and research funding bodies that are responsible for funding the research in the first place. 

But funding research and commercialising it are two entirely different processes – calling for entirely different skills. The act of preparing research for commercialisation requires commercial expertise. The process can fail for many reasons, most of which are commercial. Thus the research may be too early for translation; there may be insufficient funding; the goals are wrong; there is no business plan; the management is poor.

Oiling the wheels of tech transfer

As a scientist and entrepreneur of great reknown and huge personal charm, Winter has been there and done it, and is in a prime position to appreciate the factors that make for efficient technology transfer. With fellow researchers at the Laboratory of Molecular Biology in Cambridge, he was first to demonstrate that antibodies raised in rodents could be humanised so they would be effective in neutralising harmful proteins but would not be rejected by the human immune system. His work lies behind the cancer treatment Campath and the current best-selling drug in the world, Humira, for treating rheumatoid arthritis.

Winter’s research also underpinned several start-ups, including Cambridge Antibody Technology, the company that originally discovered Humira, and most recently Bicycle Therapeutics, which is developing “mini antibodies.” 

As Winter acknowledged in his evidence to the Science and Technology Select Committee, universities and funding bodies recognise that different skill sets are required, which is why those that are serious about translation have specialised technology transfer offices (TTOs).

But he says, the inappropriate influence of parent organisations is evident from the focus that TTOs put on early surrogate markers of commercialisation, such as number of patents filed, number of companies started and number of licensing deals.

The bottom line

Instead, the focus should be on the commercial bottom line, on revenues generated, profit (or loss) on these activities, and/or local jobs created. The monopoly of the TTOs, the use of early surrogate markers of commercialisation and the lack of a profit motive can lead to a bureaucratic attitude. As Winter notes, it’s a common complaint by industry and individual researchers that TTOs more often hinder than help - researchers and industry would often rather deal with each other direct.

For Winter, the solution is for universities and funding bodies to focus on commissioning and evaluating research, leaving the translation to independent commercial organisations and to the researchers. He proposes the formation of technology exploitation companies (TECs), to take over much of the work of TTOs.

TECs could be formed from existing TTOs or created independently, with funding coming from the government and the private sector, with equity held by each. Additional non-dilutive government funding could be used to drive large strategic investments in key areas, with private investment driven by tax breaks, at least until the TECs are established.

These TECs would need a license from the government to work with academia but would otherwise be entirely commercial organisations, competing with each other for market share.

Vibrant management culture

Researchers who were not satisfied with one TEC could turn to another, or use TECs that specialised in their area, rather than the one-size-fits-all TTO monopolies.

Winter argues TECs would not only encourage investors and business to take more of an interest on what is going on in universities, and facilitate and strengthen local enterprise clusters, but they would help bring in good management, encouraging a vibrant and risk-taking management culture.

In short, Winter says, to bridge the Valley of Death, get technology transfer out of the hands of bureaucracies – the universities, research funding bodies, the government and the EU - and into the private sector.

By providing sufficiently generous tax breaks for investors the government could create a new market - and leave it to the private sector to create what in the end will be private sector companies and jobs.

Valley of Death Report http://www.publications.parliament.uk/pa/cm201213/cmselect/cmsctech/348/34802.htm