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Hopkins striving to make industry a partner in research – University seeks funding, revenue from discoveries

Boro Dropulic had the rapt attention of about 40 Johns Hopkins University students and faculty as he spoke recently on a subject scientists at the venerable research institution once considered anathema: how to start a biotechnology company.

By:
Julie Bell
Baltimore Sun

"An entrepreneurial scientist really has to be an optimist," said Dropulic, a former Hopkins researcher who founded the gene-therapy company VIRxSYS Corp. "If you look at your own technology with cynical eyes, you’ll never get funded" by venture capitalists.

It isn’t hard to find signs that many at Hopkins are interested in relationships with industry, a prospect once considered an unseemly conflict of interest — if it was considered at all.

The Hopkins Biotech Network, a new student-industry networking club, regularly draws dozens to events such as Dropulic’s talk. At such forums, eager young scientists drawn to the university because of its academic reputation nonetheless talk about leaving for dream jobs in industry. And they mingle with Nora Zietz, a former venture capitalist who now works for Hopkins as a sort of corporate matchmaker.

Part of her job involves introducing companies and financiers to scientists with potentially valuable inventions.

"We want industry to think about us when they think about intellectual property," Zietz said.

Despite being a perennial powerhouse when raising research dollars, Hopkins lags behind most other top research institutions when it comes to bringing in revenue from the licensing of its scientists’ discoveries to companies. But the vast majority of the money for research at Hopkins comes from the federal government. Hopkins is now making a concerted effort to gain more backing from industry, which accounted for 9 percent of its $1.3 billion research budget in fiscal 2002.

"Everyone agrees, including people at Hopkins, that they’re not doing as much as they can and should to get technology into the marketplace," said Phillip Singerman, executive director of the Maryland Technology Development Corp.

Hopkins is taking steps to address the problem. When the university hired Zietz early this year, it combined the licensing offices of all eight of its schools in hopes of patenting and marketing discoveries more efficiently. It has invited at least 15 leading medical research institutions — including the University of Michigan and the University of California, Los Angeles — to co-found a brokerage that could market and license their technologies.

The moves come amid pressure on research institutions nationwide to enhance connections with industry, spurred by state and local business development officials who see biotechnology as the next big driver of new jobs.

In Baltimore, for example, the city is pressing ahead with plans to build a business park for biotechnology companies next to Hopkins’ east-side medical campus. The University of Maryland, Baltimore is working on a smaller one near its campus.

"Everyone around the country is grappling with this issue right now," said Thomas Hagerty, who markets technologies for Washington University in St. Louis. "You’re dealing with the fine line of industry and academia. It’s tricky. Looming over all of us is the issue of conflict of interest."

Universities that conduct human testing of drugs and medical devices must be careful not to allow corporate interests to unduly influence research, Hagerty said.

Still on the minds of many university officials across the country is the death of Jesse Gelsinger in 1999 from an experiment at the University of Pennsylvania’s gene-therapy institute. The institute’s director was the co-founder of a company that hoped to market discoveries made there.

Despite the potential for conflict, universities increasingly feel they can’t simply turn their backs on collaboration with companies. The Bayh-Dole Act of 1980, which allowed universities to patent and profit from federally funded inventions, also obligated institutions to actively seek ways to get resulting drugs or other inventions into public use. Since companies actually make the products, universities need their help.

Critics say universities can alert industry to their discoveries through traditional means, such as publishing or announcing them at scientific meetings. But a recent survey of 62 U.S. universities by researchers at Emory University in Atlanta and the Georgia Institute of Technology showed that most inventions need further development, with only 12 percent ready for practical use when they’re licensed to a company. And companies, the argument goes, are more likely to develop something if it’s patented and they have the exclusive license.

Universities also are feeling financial pressures. Grants from the National Institutes of Health have leveled off after years of increases, funding is being cut for public education, and the cost of research is rising, said Dr. David Korn, senior vice president of the Association of American Medical Colleges.

And drug companies, many of them facing the expiration of blockbuster patents, are clamoring to search university laboratories — where automated research tools have set a blistering pace of discovery — for ideas that could lead to new products.

"Opportunities to make money out of education and research have really grown," said Derek Bok, a former Harvard University president whose latest book, Universities in the Marketplace, explores the risks inherent in academia’s reliance on corporate money. "The pressures have always existed, but the opportunities have never been as numerous as they are at present."

Bok said it is possible for universities to take in more corporate dollars while also protecting the independence of their researchers. But "I think it’s very hard," he said. "And the temptations to get off track are very substantial. There’s no big, bright clear line that’s obvious when you’re starting to compromise things you shouldn’t."

Theodore O. Poehler, Hopkins’ vice provost for research, said the university is well aware of how carefully it needs to tread. But he said Hopkins is also aware of its responsibility to see that the public reaps the benefits of its research. And he said the university is sensitive to

criticisms from business people and economic development officials who have long found it unapproachable.

Poehler said the establishment of Zietz’s new office, the Enterprise Development Organization, "was done at least in part to make it a little easier to find your way in here, to find the right people to talk to."

The new office can help win corporate backing for Hopkins research or develop agreements for companies to acquire rights to inventions resulting from research. But Zietz’s deal-making role is likely to be broader than that, involving Hopkins in start-up companies or joint ventures.

"We’ll gladly partner," said Zietz, who noted that her office has discussed collaborations with Battelle Memorial Institute, a prolific technology developer with laboratories near Aberdeen.

William P. Tew, director of Hopkins’ recently combined Office of Licensing and Technology Development, contends the university isn’t doing anything much different to attract corporate partners.

"We are just doing more of the same," he said. But he acknowledged that Hopkins is taking "a more active role, whereas a decade ago we were more passive."

Tew has just completed a survey of other universities’ technology offices. He declined to discuss the results but said they show that his office operates much like its competitors.

Nonetheless, Hopkins’ licensing efforts have brought in significantly less licensing revenue than some. Hopkins brought in adjusted gross license income of $6.7 million in fiscal year 2001, compared with $66.7 million for the University of California System — the only institution that raised more in research dollars, according to the Association of University Technology Managers.

But Tew said the difference is often a matter of luck, that it is the rare, blockbuster invention that brings in millions of dollars in licensing cash.

"More money is always the goal," he said. "But licensing technology is like going to Las Vegas. … Most of what we do is nickel and dime stuff."

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