Demonstrates an important theorem about...


November 19, 1990|By Knowledge For Its Own Sake Pays No Bills Tim Baker

THIS CHART demonstrates an important theorem about leveraging scientific research into economic benefits. It shows that an intelligent investment in a technology-transfer office at a scientific research institution will generate a disproportionately large income for the institution and substantial economic spin-offs for the community.

The theorem has a corollary: Lilliputian investment in technology-transfer offices results in scientific research institutions which are economically irrelevant.

These simple precepts should be noted by the following: Johns Hopkins, the University of Maryland at Baltimore, College Park, the Regents, Governor Schaefer and the newly-elected General Assembly.

Before we go over the chart, let's review the theorem's consequences for Maryland's biotechnology industry, upon which so much of our state's economic future depends.

Maryland leads the nation in the amount of money spent on biomedical and biotech research. The commercialization of those technologies should leverage that scientific funding into a vibrant economic expansion. Yet, as a recent study by Elizabeth K. Nitze for the Greater Baltimore Committee shows, our state lags behind its major competitors in converting those research dollars into commercial companies and economic benefits.

For example, California generates one biotech company for every $6 million in annual research funding, with one employee in those companies for every $39,662. Massachusetts generates one company for every $10 million, with one employee for every $82,578.

In contrast, Maryland only produces one company for every $26 million, with one employee for every $306,940. In Maryland, 6,111 research employees in scientific institutions spawn only 5,481 commercial employees in biotech companies. In California, 6,589 research employees multiply themselves 37 times into 245,087 employees in commercial enterprises.

MIT established its technology-transfer office in 1965, Stanford in 1970. Professionally staffed and adequately funded, both offices provide effective support in commercializing their institutions' technologies. They coax scientists to work as partners in commercialization, guide inventions through the patent and licensing processes, help arrange financing and line up other business services. Both offices have tripled the income they generate every five years.

In contrast, Hopkins and the University of Maryland got off to a late start. College Park's technology office opened in 1986, Hopkins' in 1987. Both have worked hard to catch up. They've made progress, but as the chart shows they are still understaffed, underfunded and far behind.

The College Park office is forced to service the Maryland Biotechnology Institute, which has no office or budget of its own for technology transfer. UMAB and UMBC opened a joint office in 1989. In the leadership shuffle at UMAB, the office has become an orphan with one employee and a tiny budget. To dig itself into a deeper hole, UMAB has now decided to downgrade the office. As a consequence UMBC understandably wants to pull out and start its own operation.

None of these Maryland offices has the necessary data bases for the sophisticated financial, marketing, accounting, legal and other business services which new inventions and companies require from the private sector. Furthermore, the state does not maintain an office to support local economic spin-offs from the laboratories at the National Institutes of Health.

Historically, Maryland has failed to capitalize economically on its scientific pre-eminence because it hasn't been willing to invest in critical infrastructure. This is a lean year for the state as well as for public and private universities. Tight budgets will make it difficult to expand programs. But governors and presidents, administrators and legislators can look at the chart and see what a little investment in the right place can produce.

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