Three Wisconsin approaches to technology transfer and commercialization

Wisconsin needs to not only increase its number of new technology-based companies, but help existing businesses leverage technologies as an integral part of their growth strategies, according to a group of representatives from three of Wisconsin’s leading technology transfer and commercialization organizations.

Mike Klein

http://www.wistechnology.com/article.php?id=681

Representatives from the Medical College of Wisconsin Research Foundation (MCWRF), Center for Advanced Technology & Innovation (CATI), and Wisconsin Alumni Research Foundation (WARF), spoke to a crowd of over 100 attendees of a forum titled “Licensing Technology to Create and Expand Tech-based, High-growth Companies,” Tuesday at the WE Energies Auditorium in Milwaukee.

The meeting, hosted by WE Energies and the Milwaukee Business Journal, was designed to inform attendees from the public and private sector about how to access and leverage the research and development capabilities and patent portfolios from these institutions.

“Wisconsin needs to significantly increase "technology transfer" to create and expand high-tech, high-growth industries. Our state ranks 12th in academic research and development per capita and 13th in patents per 100,000 people, yet we rank 37th in net formation of high-tech companies per 10,000 businesses. We need to leverage our public wealth to grow our economy,” said Penny Scheuman, community development manager for WE Energies, referring to the findings of a recent Miliken Institute report.

Bill Bryant, a manufacturing specialist with Wisconsin Manufacturing Extension Partnership http://www.wmep.org/ and president of eInnovate commented, “Technology is really alive in Milwaukee, but people are not aware of it. We really need to highlight all the different technology transfer opportunities and innovative ways to approach markets.”

The three organizations presented different approaches to technology commercialization and discussed how their organizations can help advance Wisconsin’s economy.

Medical College of Wisconsin

Joe Hill, director of the MCWRF http://www.mcw.edu/research/foundation/foundation.html discussed the Medical College’s newly energized technology transfer initiative that is backed with $2.5 million in private sector financing. MCWRF’s primary purpose will be to increase revenue for the Medical College through an aggressive program to commercially license the college’s intellectual property (IP) portfolio as well as to stimulate new business formation.

The Medical College sees tremendous potential in licensing patents from its pharmaceutical, medical device, biotechnology and bioinformatics portfolio.

Hill described how the Medical College has a rapidly growing research budget, currently at $120 million, of which $80 million comes from federal funds. The Medical College is already a driving force for Wisconsin’s economy, according to Hill. “Our goal is to help continue the drive and future competitiveness of Southeastern Wisconsin” Hill said.

Hill reflected on the changes in what attracts students to his college. Today, students are concerned about how technology will work its way into clinical settings and want to see our clinical research centers, as compared to the 1970’s when students were attracted to the quality of the schools library. “In the year 2010, we want to students who come to visit us to see the quality and quantity of start-up companies in our incubator.”

According to Hill, the technology transfer and commercialization process begins with educating a school’s faculty about their intellectual property rights and showing them there is potential beyond research publication. “In our new mission, we are charged with economic development … we need to bring together inventions, patents, and ideas that form the basis for new businesses.” Hill said in order to accomplish this goal, the Medical College would continue its efforts to attract and retain entrepreneurial faculty.

Center for Advanced Technology & Innovation

In Racine an area hit hard by the downturn in its manufacturing- based economy, an economic development initiative was launched in 2001 by a combination of private industry and academic institutions to spur entrepreneurial activity and technology transfer. The CATI Center http://www.thecati.com/ , a 40,000-square-foot business incubator located on the campus of Gateway Technical College, is pioneering a new technology commercialization model in which their team approaches private businesses to donate unused intellectual property for a tax deduction. CATI helps to place a value on these patents and then decides to create a new business to utilize these technologies or to help existing businesses be more competitive and sustain growth.

“The amount of research and development within private industry is untapped,” said Mark Wagner, CATI director. “Most companies only use about 20 percent of their IP … 30 to 50 percent is often kept for competitive reasons … we estimate that 30 to 50 percent is unused and not directly usable by the company or it’s not a strategic fit and of that about 10 percent is of any value.”

It is that 10 percent that CATI targets. “We seek donations of IP that has a value associated with it,” Wagner said. He discussed how companies could benefit not only from the tax break, but also from community relations and internal IP expenditure savings. “We seek late-stage, ready-made technologies … where R&D efforts can be converted to a commercial hit … and benefit the Milwaukee through Chicago corridor.”

So far CATI efforts have been successful, as it has amassed a portfolio valued at $40 million from donations from companies including S.C. Johnson and Sons and Kraft Foods. “We are trying to organize management opportunities around our opportunities and help these new companies to manage their commercialization strategies,” Wagner said.

One of their first commercial successes is expected to be from a newly formed company called Yokit. CATI acquired the food technology from S.C. Johnson in January 2003, recruited an experienced CEO, developed a business plan and recruited strategic employees. In September 2003, CATI assisted by attracting venture capital investors and Yokit now plans to release its product into a $4.5 billion global industry in June 2004.

Wisconsin Alumni Research Foundation

Wisconsin is home to one of the most admired and experienced technology transfer organizations in the world, WARF http://www.warf.org/ . Established in 1925, by University of Wisconsin-Madison Professor Harry Steenbock, WARF’s mission is to support scientific research at UW by moving inventions to the marketplace and investing licensing proceeds to fund further research. It has been hugely successful and each year over $1 billion of products are sold under license from the organization.

According to Emily Bauer, Wisconsin licensing representative, WARF receives 360 disclosures annually and accepts 60 percent for patent applications. WARF licenses 100 to120 technologies per year and returns $40 to45 million back to the university. Over 300 UW faculty and researchers are currently receiving WARF patent royalties.

WARF’s influence extends beyond the Madison campus as the organization also manages the WISys Technology Foundation http://www.wisys.org/ , which provides patent and licensing services to the entire UW System. WISys, established in 2000 as a pilot project, is a wholly owned subsidiary of WARF. The foundation is currently handling disclosures for 12 of 13 of Wisconsin’s four-year universities and their portfolio includes some exciting technologies from campuses in Milwaukee to Eau Claire.

WARF currently has 1,500 patents available for licenses and has recently begun an initiative to license technologies to Wisconsin businesses. WARF’s “What’s IN It For Wisconsin Business” campaign is designed to make the Madison-based foundation more accessible to companies throughout the state, as well as to educate them about the wealth of home-grown product potential — in the form of patented UW discoveries.

“We do what we can to work with Wisconsin companies,” Bauer said. “Since 1993 WARF has taken an equity position in 29 startups, many of them in Wisconsin.”

Following his presentations, Matt Wagner said, “Our goal should be to build companies in Wisconsin that are competitive in the global marketplace.”

Tom Hefty, a Milwaukee-based attorney and co-chair for Gov. Jim Doyle’s Economic Growth Council, commented on the three different approaches to technology transfer.

“WARF is doing well and it was great to have them at the event as they are not that well known in Milwaukee, The Medical College is just getting started with a new initiative and that is very exciting and CATI seems to be having an impact in their community,” he said.

“Technology may be viewed differently throughout Wisconsin. In Madison we see institutionalized technology, but throughout the state the possibilities of applying technology to established businesses creates some exciting opportunities,” said Frank Staniszewski, president of the Madison Development Corporation.

“These new initiatives are huge and their impact on the states economy in five to10 years will be phenomenal,” Scheueman added.