Technology transfer gains pace

30 Oct 2003

For the past two decades there has been a stark contrast between the gung-ho business acumen evidenced on US university campuses and the plodding, purely academic nature of Irish campuses.

Earlier this year Amit Singh, founder and CEO of Peribit Networks, one of the fastest growing IT companies in the world, came to Dublin. Describing how his company grew out of a thesis while studying on the campus of Stanford University, Singh said that it is widely accepted that at Stanford University, neighbouring Silicon Valley in California and the birthplace of internet industry giants such as Sun Microsystems, Yahoo! and Cisco, some 60pc of the academic staff have commercial interests in business and tech start-ups.

Correcting himself, he said that the figure was probably closer to 75pc of academic staff fuelling start-up enterprises from on-campus research, and encouraging students to think business. This, I countered, contrasts starkly with the Irish situation where the rate of technology transfer of an idea or project into a world-class business is perilously low. Technology transfer offices in Irish universities in most cases employ just one person. Singh was speechless at this statistic. Would you blame him?

The problem has been that through much of the economic malaise of the past three decades, Irish academic institutions have been exactly that, academic institutions. Students were there to learn, lecturers were there to lecture and administrators were there to administrate. The notion of academic staff and students dabbling in the dark arts of business during college time was unheard of. This had darker implications for business. Apart from employing graduates, the level of interaction between indigenous firms and researchers on a campus was also rare, resulting in lesser innovation and even lesser growth.

As the Nineties gave way to the fabled tiger years, ground-breaking companies such as Iona, Trintech, WBT and Massana grew from university campuses to become world leaders in their respective fields. Such firms broke the mould and colleges and universities are beginning to cotton on to the fact that their financial futures lie in fostering research, commercialising it and spawning world-beating firms.

Since the late Nineties, University College Dublin (UCD) campus companies have raised more than €90m in venture capital between them, and the Dublin university’s technology incubator NovaUCD recently raised €1m in royalties from the sale of medical test intellectual property to Abbot Laboratories. UCD has pushed to expand on these successes with the establishment of the NovaUCD Centre, which will have up to 40 incubation units, following an investment of €10m by several private firms as well as UCD and Enterprise Ireland.

There was also a certain naivety amongst academic researchers in Ireland about their potential. When a researcher made a breakthrough there was a tendency to publish an article about it in some academic journal instead of patenting it and establishing a business or selling the intellectual property rights. Damian Dalton, CEO of NovaUCD campus company Neosera, which develops technology that speeds up computer hardware, recalls: “Irish academics certainly had a tendency to ‘publish and perish’.”

“Technology transfer has been a major problem for Irish universities,” explains Danny O’Hare, chairman of the Information Society Commission. “However, the universities and the Institutes of Technology are recognising its potential and colleges are becoming more than academic institutions but conduits for future revenues. Finances of the future for universities will come from not only educating students, but from turning some of their research into world-beating businesses.

“Academic institutions are also realising the benefits of working with indigenous companies and it is a win-win situation for both parties. Indigenous firms gain new products and newer avenues to profitability and can push ahead with new ideas and the colleges gain employment for their students and intellectual property that they can sell on,” O’Hare says.

This lesson has not been wasted on North-South trade body InterTradeIreland, whose Fusion technology transfer initiative has already generated €5.6m worth of benefits for 57 SMEs across the country that have worked with universities to unlock potential. The initiative is about to be expanded with a further €32.1m that will create 130 additional partnerships across Ireland over the next four years. InterTradeIreland will supply €13.6m worth of financial support and the remaining €18.5m will come from participating businesses. It is understood that up to 171 different partners, involving companies, research centres and graduates have been involved in Fusion, developing technology transfer in sectors as diverse as food, pharmaceuticals, engineering and polymers.

InterTradeIreland director Aidan Gough explains that out of the €13.6m the organisation is investing in technology transfer, he anticipates a return on investment of some €43m. “We are trying to merge the expertise that lies across the country and support the development of businesses by transferring knowledge from academia to industry,” he reveals. In terms of how a technology transfer project would work, Gough gave the example of small Donegal-based packaging firm RA Pacaisti Teoranta that wanted to develop into new markets. “As a result of a collaboration with Queens University Belfast, the company was able to develop a new form of polymer wrapping that has resulted in the company winning more than €2m worth of new business, including a major deal with sandwich chain Bendini & Shaw.”

Gough continued: “There is no doubt in my mind that Ireland is on the cusp of transition, moving into more competitive markets, from being investment driven to being innovation driven.”

Sadly, however, the very moment that Irish universities had embarked on the road to innovation and stronger ties with businesses, a key aspect in this journey, funding through the Programme for Research in Third-Level Institutions (PRTLI), has been postponed by the Irish Government. According to NovaUCD boss Dr Pat Frain, this could have major implications. The Government established the PRTLI in 1998 in order to develop research infrastructure, which is seen as a central component of the National Development Plan. Some €284.6m in PRTLI funds were allocated during cycle one and two of funding, covering capital and programmatic costs. Some 13 research centres around the country were built during 2001 and 2002. However, the capital element of cycle three funding — €178m out of a total of €320.4m — has been ‘paused’ since the budgetary announcements of the fourth quarter of 2002. It is understood that a proposal for a borrowing arrangement to cover the capital requirements of the PRTLI for the next two years is with the Department of Education and Science and the Department of Finance. But neither department can provide a date for a resumption of funding.

Frain warns: “We need to do more R&D in Ireland and for third-level institutions, the PRTLI was key to enabling better technology transfer of research from colleges and universities into cutting-edge entrepreneurial enterprises. But that has been put on hold by the Government.”

He adds: “This sends out the wrong signals to the world. It means that research facilities are not being built and for foreign researchers that have come to Ireland, it may mean that some will return to their home countries. If this continues for too much longer it will impact R&D facilities in all of the country’s third-level institutions and put many of them four to five years in the red.

“The other major issue is the impact the postponement of PRTLI will have on foreign investment. The high-quality companies that will come to Ireland to do research will read into the decision to postpone PRTLI as a lack of commitment on the Government’s part and this could be a serious problem down the road.

“The scheme when it first came on board resulted in a significant improvement in infrastructure, but it will cause considerable bottlenecks if it is delayed any longer,” Frain warns.

By John Kennedy

The courtyard of NovaUCD, the Innovation and Technology Transfer Centre