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The Policy and Legal Environment for Innovation
Summary and Overview
Krattiger A, RT Mahoney, L Nelsen, JA Thomson, AB Bennett, K Satyanarayana, GD Graff, C Fernandez and SP Kowalski. 2007. 3: The Policy and Legal Environment for Innovation. In Executive Guide to Intellectual Property Management in Health and Agricultural Innovation: A Handbook of Best Practices (Krattiger A, RT Mahoney, L Nelsen et al.). MIHR (Oxford, UK), PIPRA (Davis, USA), Oswaldo Cruz Foundation (Fiocruz, Rio de Janeiro, Brazil), and bioDevelopments-International Institute (Ithaca, USA). Available online at www.ipHandbook.org.
© 2007. A Krattiger et al. Sharing the Art of IP Management: Photocopying and distribution through the Internet for noncommercial purposes is permitted and encouraged.
Changes in both national and international legal frameworks have profoundly affected how companies manage their intellectual assets in furtherance of economic and strategic business objectives and how they pursue their R&D. Moreover, the changes have enabled a broader distribution of health-related technology to people in developing countries. Public sector institutions likewise have had to adapt to an increasingly globalized knowledge-based economy. One adaptation is the ever-increasing interaction between developed countries and developing economies, particularly more innovative developing countries (for example, Brazil, China, India, Korea, South Africa). A second adaptation is the increased complexity of interactions between public and private sector actors. A third involves an evolution in the judiciary: toward a clearer judicial structure with more reliable and predictable mechanisms of dispute resolution. Many innovative developing countries are undergoing far-reaching changes within the judiciary, and experience from the creation of the Court of Appeals for the Federal Circuit (CAFC) in the United States offers many useful insights.
In order to help revitalize flagging technological innovation in the faltering economy of the late 1970s in the United States, a fundamental change in the judicial structure took place in 1982. As a judge at the CAFC, Newman1 describes the creation of the CAFC (the national appellate court that would hear all patent appeals) as the first profound change in over 100 years concerning IP-related dispute resolution. A single appellate court would better understand and correct policy misperceptions, largely created by judicial decisions that had negatively influenced investment incentives in relation to patenting. A uniform and predictable application of the law across the United States and a concomitant end to forum shopping would promote innovation. And indeed it has. The effects have been dramatic: industrial activity, based on strengthened patent incentives, has surpassed the most optimistic expectations.
In addition to the establishment of the CAFC, two other critical events at the beginning of the 1980s catalyzed the growth of the biotechnology industry. In 1980, the Supreme Court’s landmark decision in Diamond v. Chakrabarty, despite dire predictions to the contrary concerning the patenting of life forms, opened the nation’s economy to biotechnology as an industry, enabling investment and commercialization in this nascent field. Also in 1980, the Bayh-Dole Act catalyzed the revitalization of commercial products arising from government investments in academic research. The combination of the CAFC, the Chakrabarty decision, and the Bayh-Dole Act synergistically drove the biotechnology revolution in the United States.
Because of rapid scientific developments, new issues of law constantly arise. Advances in health and agriculture raise legal questions for which there are no direct precedents and about which there is no consensus. Therefore, the courts take an incremental approach to such questions, building on indirect precedents that attempt to balance the competing visions of patent theory and that respond to the quick pace of scientific discovery. In other words, the present builds on the past to create a coherent and stable body of law.
When technology and biology are involved, the overview of jurisprudence (as well as decisions in individual cases) will affect the nation’s economy and the public interest, and, additionally, have an even broader global impact. This Handbook arises from the premise that the development of the products of science and technology profoundly benefits the public and that both scientific and industrial participation are required in order for their benefits to be realized. This is a many-faceted concept; yet we exist in a time of such pervasive scientific and technological advance that the development of these benefits and their movement into commerce among nations warrant our most concerted efforts.
But are public research institutions really delivering public goods? This question might appear foolish. In the past 50 years, the intensity of research and the pace of discovery in the biomedical and health fields have accelerated dramatically, not only in the United States, but in many parts of the world, particularly in the more innovative developing countries. As a result, the number of safe and effective drugs, vaccines, and medical devices for a broad range of illnesses and conditions has skyrocketed, as have sales in developed countries. But in an increasingly global world—in which the risk of disease and the benefits of research can come from any corner—the benefits from public sector health investment should be global. Keusch and Nugent,2 therefore, argue, on the basis of their experiences in the United States, that the public-benefit aspect of government-sponsored research investments should include (the poor) in countries outside the United States.
Because of the “public goods” aspect of health, governments should fund health research, and indeed they do. For similar reasons, they also fund agricultural research and extension services. Such publicly supported research fills knowledge gaps that private industry ignores, even though public sector inventions are usually brought to market by private sector product development. The choice of whether to develop new ideas into products is largely left up to the private sector. Thus, technology development from public research proceeds largely according to private sector priorities. So what role do public agencies have in ensuring that the public benefits from its investments in health research? The answer is not obvious. Under current arrangements, the public sector has limited capacity and experience in the downstream steps of developing and delivering biomedical products to patients. These steps typically require a significant investment of money. They are also not aligned with the public sector’s comparative advantages.
The public sector, therefore, needs to be creative, and Keusch and Nugent outline several ways that decision makers can strengthen and reorient the public sector’s intellectual property (IP) strategies to expand the ability of developing countries to access the benefits derived from public research investments. They discuss several strategies that public institutions can adopt to increase the resources and tools devoted to the public health needs of the developing world:
- At the upstream end, the public sector can direct funds toward research on diseases in developing countries and can partner with private and nonprofit entities wishing to do the same.
- At the downstream end, public sector institutions can directly provide products to users in poor countries, reduce barriers to the transfer of technology that benefit developing countries, or partner with industry and academia to expedite the development of products from research.
As much as the Bayh-Dole Act successfully created a large body of intellectual property from publicly funded research, it has reduced, in some regards, the availability of public goods for health and agriculture. Current practice undervalues the public-benefit aspect of the mandate, especially for the poor. As developing countries increasingly consider implementing Bayh-Dole-related legislation, these countries should carefully study the conclusions from this chapter so they may improve upon the experiences in the United States. It should be pointed out that the intent of Bayh-Dole was not to produce supplemental revenue streams to universities. Rather, it was to encourage private innovation and increase the use of technology for economic development.
Graff3 surveys the opportunities available in 18 developing countries4 for new technologies to flow to the private sector and the public policy issues needing to be addressed to facilitate this. Three key aspects of public policy are considered:
- The availability of IP protection
- The designation of IP ownership
- The existence of the infrastructure needed to make IP protection and ownership a reality
The chapter reveals that strong IP protection capabilities are correlated with robust scientific research efforts, to the strength of the countries’ IP laws through history, and support of, through membership in, international trade agreements, particularly the Agreement on Trade-Related Aspects of Intellectual Property (TRIPS) and the International Union for the Protection of New Varieties of Plants (UPOV). Regarding IP ownership issues, policies in most countries are moving toward granting the rights and responsibilities of ownership to research institutions. Finally, sophisticated institutional IP management is correlated to research capacity and to government investment in public sector and university research and development. Generally speaking, vigorous IP protection policies and the capacity to enforce and manage them are mutually strengthening. The biggest factor for this strengthening is the amount of research and development a country conducts, followed by the ability of its economy to absorb new innovations into existing or new industries. Those seeking to use intellectual property as part of an integrated strategy to grow the economy through public financing and commercialization of innovation will find these trends worth considering.
In the chapter by Finston,5 the discussion moves away from broad national policies to specific technology transfer policies. Finston reveals, using many colorful examples, how such policies can have a broad-ranging, positive impact for a country, raising the standard of living, improving the economy, and opening many commercial opportunities. Primarily addressing government policymakers, this chapter defines the policy conditions needed for a robust national technology transfer system:
- Government support of science education, research, and related infrastructure that together will create an enabling environment
- Rule-of-law protections (predictable laws, fair enforcement, judicial remedies), including those relating to intellectual property
- A reliance on market forces, which foster informed risk-taking and private sector investment, to determine which technologies and products should be developed
Finston argues that these three factors are mutually interdependent and should all be present to create a favorable environment for technology transfer. To support her claims, the experiences of five geographically and developmentally diverse countries with existing technology transfer policies are described: Brazil, Israel, Jordan, India, and Ireland. As a result of technology transfer reforms, these countries enjoyed growth in R&D, technology transfer, and economic activity. If one or more of the above three requirements were missing, a country would not have advanced as far technologically or economically.
The key lesson offered by her chapter is that the strength of government and of the private sector can be synergistically applied to improve the lives of all. Technology transfer works best when there is strong, consistent government support of basic research, including science education and technology-related infrastructure and robust IP protection.
Given the success of technology transfer in the United States, many countries’ expectations of similar programs in their own countries are grossly overestimated (if not outright misdirected). Indeed, Heher6 points out that many policymakers in developing countries proclaim that a technology transfer program should become a major source of income. Too often, such programs begin too optimistically, but within a few years, end up disillusioned.
Unless the central reasons for undertaking technology transfer (for long-term social and economic benefits) are understood, a boom-and-bust cycle, replete with unrealistic financial expectations, is likely to prevail at considerable cost to those involved. Indeed, countries have yet to develop answers to basic questions. For example, what exactly is the nature of success in technology transfer? And what precisely are the elements that make this success possible? This chapter uses international technology transfer benchmark data to benchmark and understand the implications of promoting technology transfer and the likely outcomes of a technology transfer initiative under realistic conditions.
Heher provides comprehensive data and concludes that income generation from technology transfer is an inadequate—if not inappropriate—reason for an institution to invest in technology transfer. Governments should not expect revenues from technology transfer to be able to fund research institutions. Indeed, the financial benefits of technology transfer activities are captured primarily at the national economic level through business creation, with national returns arising from indirect economic effects. The extended time period required for individual institutions to derive benefits together with the fact that the benefits are largely felt by the national economy suggest that appropriate national support measures are needed to encourage technology transfer.
Bringing this realistic approach to the institutional level is the topic of the chapter by Taubman and Ghafele.7 First, the authors strongly endorse the indigenous innovation potential of developing countries. Second, they detail the inadequacies of a top-down approach to developing IP management policies and approaches, as such an approach would almost invariably ignore the unique strengths of a particular country or institution. Rather, to seize on such strengths, a thoughtful dialogue between policy-conscious practitioners and practically informed policymakers is advocated by the authors. This requires knowledge one to act flexibly.
Taubman and Ghafele insist that IP management for the public interest should go beyond licensing arrangements and consider the full range of two continuums: degrees of exclusivity and degrees of market engagement. To demonstrate, the efforts of Jordan and Indonesia to manage intellectual property for the public good are examined. Both countries have passed IP legislation and have developed their IP policies in relation to broader public policy goals. The authors conclude that success requires flexible use of market mechanisms and the strategic deployment of the full range of exclusive rights afforded by IP protection. This can lead to some creative solutions. Public sector institutions should learn to use the rules at least as well as their private sector counterparts to achieve their public policy aims. This has never been more urgent than with the coming into force of the TRIPS Agreement in most developing countries.
TRIPS mandates minimum IP protections for patented pharmaceutical products.8 Within this requirement, countries have considerable freedom on many specific aspects of TRIPS, and it is wise (if not imperative) for developing countries to exercise these flexibilities to the maximum extent possible. Thus, TRIPS can have profound effects on innovation, on the scope and magnitude of R&D investments, and on product availability. Product price in low- and middle-income countries is vigorously debated. Predicting and measuring the impacts of TRIPS on innovation is an unwieldy task because of the numerous variables in play and also because TRIPS only came into force in 2005, in many of the innovative developing countries. This is a short time to measure specific impacts; a simple measure like the price of a product is but one of the factors that determine “access” to patented health and agricultural products. Another factor would be the types of drugs or vaccines that are becoming available. Indeed, based on a conference held in India, the conclusion was drawn by Eiss, Mahoney, and Satyanarayana9 that much of the impact of TRIPS will depend on how countries and institutions respond to the new IP regime.
There is every indication that IP management skills appear to be one of the crucial elements for harnessing the positive potential of TRIPS, and mitigating the negative ones, and such skills will allow developing countries to gain access to emerging tools, technologies, and resources that can dramatically improve the health and welfare of their citizens. Effective IP management can allow public research institutions to use their own research products to benefit the poor and to enter into public-private partnerships that can direct the power of industry to the needs of the poor. Without knowledge of sophisticated IP management techniques, however, such efforts—and their benefits—will be impossible.
The World Trade Organization (WTO) offers many initiatives and instruments that seek to enhance IP capacities in the developing world. Specific initiatives and instruments are also aimed at mitigating the possible negative effects of TRIPS. These are discussed by Watal and Kampf10 and include compulsory licensing, the Doha Declaration, elements of the Convention on Biological Diversity, traditional knowledge projects, technology transfer programs, and IP capacity building programs.
Of particular relevance here is the Doha Declaration, which sought to address the potential constriction brought about by TRIPS regarding access to patented medicines in developing countries. The Doha Declaration emphasizes that the TRIPS Agreement does not and should not prevent members from taking measures to protect public health, and it reaffirms the right of members to use, to the full extent, the provisions of the TRIPS Agreement that provide flexibility in terms of accessing medicines. The Declaration states that each member has the right to determine what constitutes a national emergency, or other circumstances of extreme urgency, and explains that public health crises, including those relating to HIV/ AIDS, tuberculosis, malaria, and other epidemics, can represent such circumstances.
By virtue of WTO member states having signed and ratified the agreement, TRIPS constitutes international law. It must be translated or adapted into national law individually by each member state. Though not directly related to TRIPS, the chapter by Bremer11 provides an overview of key legal provisions in the United States that have profoundly affected the evolution of IP rights and technology transfer. The fundamental basis underlying the transfer of technology as intellectual property is embodied in the country’s Constitution, which embraces patents, copyrights, and trademarks within its scope. The terms and provisions governing these forms of intellectual property are codified in various statutes, but two pieces of legislation are especially important.
The first is the Stevenson-Wydler Act enacted to promote the utilization of technology owned by the government and generated with its help. It aids the transfer of that technology to the private sector and government at the state and local levels. The second law is the Patent and Trademark Amendment Act of 1980—known as the Bayh-Dole Act. The Bayh-Dole Act established a uniform federal patent policy and provided the first statutory authority for the U.S. government to take title to and hold patents through its agencies. The success of this act makes it of special interest to countries seeking to establish IP regulatory systems, and this chapter explains the structure and history of Bayh-Dole.
Bremer also discusses the important interplay between patents and antitrust laws, recognized as complementary tools that enhance competition. The laws are based on the important premise that patents per se do not convey market power. Only when coupled with other assets, or when acquired in order to build a monopolistic behavior, can patents create market power. Antitrust scrutiny is triggered when patents (and certain other market positions) are combined with apparent predatory practices that restrain trade and competition. The point of this chapter then becomes very clear: a country strengthening its patent laws should, concurrently, strengthen its antitrust laws as well as its capacities to enforce them.
One such enforcement is the capacity of a government to bring about a compulsory licensing action. A compulsory license is an authorization given by a national authority to a natural or legal person for the exploitation of the subject matter protected by a patent; the consent of the patent holder is not necessary. Compulsory licenses may be required to import or produce a given product or to use a patented technology for research. They are especially important when there are no close substitutes for a product or process and a research exception is not available or is too narrow. Compulsory licenses are granted in order to attain various public policy objectives, such as: to address emergencies and public health needs, to counteract anticompetitive business practices, or to permit the exploitation of patents that are not used.
Correa12 discusses the usefulness of compulsory licensing and provides a step-by-step guide to obtaining compulsory licenses to ensure that the R&D of drugs needed by people in developing countries is kept free from unnecessary entanglements in the global IP system. His chapter provides many illustrations and a useful discussion of the patenting and licensing strategies of universities and other public sector research institutions. These institutions often hold patents on research tools, underscoring the importance of the public sector retaining research-use and humanitarian-use rights in all licenses.13 While there are several ways to circumvent patented upstream technologies, and the compulsory license is especially powerful. But, perhaps due to its power, the strategy also has drawbacks. The flexibility of compulsory licensing should be considered in the context of all of the options available to TRIPS member countries. Importantly, applicants need to be certain that they have the capacity to exploit the licenses and the financial ability to remunerate the patent holder or holders. Nonprofit research institutions may often find this particularly difficult because, even with a compulsory license, commercial partners need to be willing to produce and distribute products developed under compulsory licenses. This is one reason for further investments in technological and IP capacity building and the establishment of strong institutional networks.
Institutional networks are most powerful when formed around geographic clusters. Innovation in health and modern agriculture relies on a sophisticated open system of knowledge sharing. Recent studies suggest that successful innovation indeed requires development of clusters of institutions, businesses, and personnel. “Location, location, location,” the battle cry for property realtors everywhere, is heard increasingly with respect to innovation dynamics and knowledge-based growth.
A cluster is a group of similar things positioned or occurring closely together. Although companies and various not-for-profit entities in the same sector or product market have traditionally located themselves in close geographic proximity (rather than spreading out evenly across the geography or economy), the express search for ways to encourage clustering has only recently begun. One paradigm, as discussed extensively by Phillips and Ryan,14 is that local competition is the primary engine behind cluster development and sustainability. Additionally, innovation now involves and generates significant externalities; innovators increasingly rely on an array of formal and informal collaborators, and the efficacy of those relationships will determine their ability to successfully launch an innovation into product development.
Offering an overview of recent research on clusters in Canada, this chapter observes that one factor encouraging cluster formation is the development of a cost-effective, efficient IP management system. Equally important is the use of social capital, which can lead to less formal collaborations that can better disseminate and utilize discoveries. While the traditional strategy of protecting infant industries in order to develop them made some sense in the industrial world, its value in a knowledge-based world is unclear. Knowledge-based development is inherently different from traditional industrial development. Indeed, multiple types of knowledge are involved in such a system, and Phillips and Ryan address how clusters integrate four distinct types of knowledge: “know-why,” “know-what,” “knowhow,” and “know-who.” A cluster’s ability to use and share these types of knowledge is largely what empowers individual entities within the cluster to innovate. Basing their ideas on varied illustrations and deep analysis, the authors conclude that governments have an important role to play in the process of cluster formation and that ensuring a mix of “local buzz” and “global reach” is part of the recipe for success.
A specific experience of cluster development and the role of government are presented by Viljamaa,15 who discusses the case of Turku, Finland. The city is home to a large concentration of biotechnology activities. This model can be described as a science-led strategy, led from above, with a range of important lessons for policymakers and institutional leaders alike. The experiences suggest that sharing facilities with companies and combining forces with other universities and R&D institutes are vital ways of building clusters and momentum in innovation. Active partnerships with larger entities are important, as is a global network of scientists. Viljamaa offers many ideas that are particularly pertinent to developing countries that wish to encourage the formation of clusters. One is that building clusters from scratch is basically impossible; success comes from building upon existing strengths. Many successful clusters have been based on older but related industries.
Probably the most famous example of a cluster that is grounded on entrepreneurship is the biotechnology cluster of the greater Boston area, which encompasses Massachusetts Institute of Technology (M.I.T.), Harvard University, Boston University, and others. M.I.T., some argue, has led the translation of university-generated research from the laboratory to the private sector through the cultivation of an entrepreneurial culture. Indeed, the entrepreneurial activities of M.I.T. have served as an incubator for generation after generation of entrepreneurial engineers and scientists who view risk as an opportunity. Seeing risk and opportunity as two sides of the same coin, students at M.I.T. don’t utter, “Why do you want to do that?” but instead proclaim “Hey! Why not?” This positive attitude, this sense of self-confidence, typifies M.I.T.’s culture, from professors to students to its licensing professionals.
Nelsen16 points out that M.I.T.’s licensing office also has served as a focal point for the formation of the greater Boston area’s biotechnology cluster. By coordinating the management of M.I.T.’s intellectual property, the office contributes to the robust development of many companies that form the cluster. This promotes further development, economic progress, investment in innovation, creation of networks, and ultimately, success. Although Boston is quite unlike most developing-country cities, the fundamental principles that drive its economic development are universal.
With respect to working with developing countries, M.I.T. recognizes that there are often special circumstances requiring creative practices (for example, preferential pricing for developing country public sectors, strategic patent filing, and differential licensing practices). Hence, with M.I.T. licensing, there are no rigid written policies guiding how technologies are handled (the exception to this is clear and nonnegotiable conflict of interest policies and practices); instead, the choices are left open in order to creatively craft agreements to maximize access. This flexible management fuels the innovation engine, and this approach can be adapted by many other regions.
But what are the potentials for individual countries to develop thriving cluster complexes without misspending scarce funds? What variables are essential for cluster development? In another chapter, Phillips and Ryan17 identify six factors: manufacturing capacity, domestic market, export market, R&D, an IP system, and a functioning drug regulatory system. The authors explore these factors across three development stages to measure a country’s cluster capacity. The authors go further and provide a five-stage process for realistic cluster building:
- Assessing capacities, resources, and opportunities
- Choosing an anchor strategy (different cluster approaches will have different sets of requirements, leaders, and tactics, and different success rates.)
- Identifying organizational and institutional leaders to take the lead in developing the cluster.
- Adopting proactive tactics, spanning numerous areas, including having the necessary legal and social structures, efficient mechanisms to protect and adjudicate property, the lowest possible barriers for entering or exiting key input and output markets, the ability to trade domestically and internationally, and effective tax, regulatory, and trade rules.
- Sustaining the lifecycle of the cluster (Recognizing that the evolutionary dynamics of markets are unavoidable, clusters should re-invent themselves every now and then to prevent cluster decay.)
Importantly, clusters thrive when local strengths are nurtured rather than when companies are lured with subsidies. Building infrastructure does not fill the buildings with innovative enterprises, but rather, innovative enterprises make buildings happen. Hence different types and sources of capital flow are needed at different stages of cluster development. Government money sometimes gets in the way of private money and vice versa.
The real and most effective catalysts for change are key individuals who serve as ambassadors or entrepreneurs for geographic regions; they cross-fertilize public-private partnerships which, in turn, alert the public sector to market demands and provide companies with access to basic research, infrastructure, and people capacity. This is why many institutions look for “people policies” to nurture clusters. Indeed, people are at the center also of these intellectual assets. Knowledge-based development is inherently different from traditional industrial development. Today’s innovation potential requires, above all, global, institutional, and personal links and networks. They are the necessary fertile ground that enables innovation to flourish.
Endnotes
1 Chapter 3.1 by P Newman titled The Courts and Innovation, p 147.
2 Chapter 3.2 by RA Nugent and GT Keusch titled Global Health: Lessons from Bayh-Dole, p. 153.
3 Chapter 3.3 by GD Graff titled Echoes of Bayh-Dole? A Survey of IP and Technology Transfer Policies in Emerging and Developing Economies, p. 169.
4 The countries are Argentina, Brazil, Chile, China, Ethiopia, India, Indonesia, Jordan, Kenya, Malaysia, Mexico, Philippines, Poland, Russia, South Africa, Tanzania, Uganda, and Vietnam.
5 Chapter 3.4 by SK Finston titled Technology Transfer Snapshots from Middle-Income Countries: Creating Socio-Economic Benefits through Innovation, p. 197.
6 Chapter 3.5 by AD Heher titled Benchmarking of Technology Transfer Offices and What It Means for Developing Countries, p. 207.
7 Chapter 3.6 by A Taubman and R Ghafele titled Public Sector IP Management in the Life Sciences: Reconciling Practice and Policy-Perspectives from WIPO, p. 229.
8 TRIPS requirements are broader than this. They also include the application of basic principles of the trading system and other international IP agreements; adequate enforcement of IP rights in member countries of the World Trade Organization (WTO); IP dispute settlement between Members of the WTO; and special transitional arrangements for the introductory period of the new system.
9 Chapter 3.7 by R Eiss, RT Mahoney, and K Satyanarayana titled Developing Countries and TRIPS: What Next? p. 247.
10 Chapter 3.8 by J Watal and R Kampf titled The TRIPS Agreement and Intellectual Property in Health and Agriculture, p. 253.
11 Chapter 3.9 by H Bremer titled U.S. Laws Affecting the Transfer of Intellectual Property, p. 265.
12 Chapter 3.10 by CM Correa titled Compulsory Licensing: How to Gain Access to Patented Technology, p. 273.
13 See also Section 2 of the Handbook discussed on pages 11-20 of this Executive Guide.
14 Chapter 3.11 PWB Phillips and CD Ryan titled The Role of Clusters in Driving Innovation, p. 281.
15 Chapter 3.12 by K Viljamaa titled What Does It Take to Build a Local Biotechnology Cluster in a Small Country? The Case of Turku, Finland, p. 295.
16 Chapter 3.13 by L Nelsen titled The Activities and Roles of M.I.T. in Forming Clusters and Strengthening Entrepreneurship, p. 309.
17 Chapter 3.14 by PBW Phillips and CD Ryan titled Building Research Clusters: Exploring Public Policy Options for Supporting Regional Innovation, p. 317.
 Abstract
The Activities and Roles of M.I.T. in Forming Clusters and Strengthening Entrepreneurship
by Lita Nelsen
Abstract:
This chapter describes the structure, policies, and operations of the Technology Licensing Office at the Massachusetts Institute of Technology (M.I.T.). The chapter emphasizes the licensing office’s role in generating spinout companies and considers the importance of the biotechnology cluster within the state of Massachusetts and it’s surrounding regions. Also discussed is M.I.T.’s approach to ensuring that licensing procedures maximize access to medicines and vaccines arising from M.I.T.’s research.
Abstract
Benchmarking of Technology Transfer Offices and What It Means for Developing Countries
by Anthony D. Heher
Abstract:
At universities in both developed and developing countries, increasing emphasis has been placed on promoting technology transfer. Unfortunately, technology transfer is sometimes undertaken for the wrong reasons, especially in the mistaken belief that technology transfer will lead to substantial additional income for the institution. While it is important to protect intellectual property arising from research and to actively promote the transfer of research results, generating income should not be the primary objective in the transfer of technology. This is particularly important for health science, where there is a risk that research results, if not properly protected, will be inaccessible to private or public entities seeking to use the research for public benefit.
International technology transfer benchmark data can be used to understand the implications of promoting technology transfer and the likely outcomes of a technology transfer initiative. The benchmarks indicate that average income to an institution, after eight to ten years of activity, is likely to be a modest 1%–2% of annual research expenditure. The income is, moreover, highly uncertain and variable. Institutional and public sector managers must understand the nature of this income and the dynamics of the technology transfer process in order to manage this emerging discipline effectively, because unrealistic expectations can lead to dysfunctional policy decisions. The data and dynamic model presented in this paper are intended to promote better decisions.
Abstract
Building Research Clusters: Exploring Public Policy Options for Supporting Regional Innovation
by Peter W. B. Phillips, Camille D. Ryan
Abstract:
Governments at all levels are showing great interest—and some are spending lots of money—in developing research clusters that they hope will benefit their local and national economies. Clusters are complex, however, and this chapter aims to help policy-makers maximize their benefits. The chapter offers a taxonomy of countries and their potential for cluster development and explains a five-stage process for realistic cluster building. Stage one assesses capacities, resources, and opportunities. Stage two involves choosing an anchor strategy. In stage three, organizational and institutional leaders are identified to take the lead in developing the cluster. In stage four, proactive tactics are chosen. Stage five identifies the cluster’s lifecycle and the strategies needed to sustain it. Cluster building is knowledge-based development, which is inherently different from traditional industrial development. For one thing, cluster building requires global links. Companies and skilled employees are less interested in fiscal incentives, public infrastructure, or other government support than in the innovation community and its networks.
Abstract
Compulsory Licensing: How to Gain Access to Patented Technology
by Carlos María Correa
Abstract:
Voluntary patent licenses are often difficult for institutions to obtain, particularly those in developing countries. This chapter discusses why, how, and by whom compulsory patent licenses may be obtained and used. The main focus is on patented research tools rather than patented end products.
Abstract
The Courts and Innovation
by Pauline Newman
Abstract
Developing Countries and TRIPS: What Next?
by Robert Eiss, Richard T. Mahoney, Kanikaram Satyanarayana
Abstract:
This chapter provides an overview of the current and potential impact of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) on low- and middle-income countries. The chapter also summarizes the findings of a meeting in New Delhi, India and explores the legitimacy of concerns about TRIPS. Access to health products relies on many factors, including the successful innovation of new technologies. Innovation, in turn, is a complex process, involving many factors (intellectual property [IP] is just one) that influences product availability and price.
Pointing to the growth of global and national public–private product-development partnerships (PDPs), the chapter highlights one way these countries are seizing opportunities—and reveals how important effective IP management has become for them. Focused on high-priority diseases such as AIDS, malaria, and TB, PDPs require the development and implementation of sophisticated IP management policies and practices in both developed and developing countries in which PDPs operate. Finally, the chapter discusses the possible role of compulsory licensing and parallel trade. The value of these flexible options, provided by TRIPS, is yet undocumented and successfully implementing them represents a significant challenge. Crucially, countries have considerable freedom to control the effects of TRIPS on the availability of new health technologies. The countries can do this most effectively by building capacity for IP management and by formulating policies and practices, for courts, patent offices, and other institutions, that favor the poor.
Abstract
Echoes of Bayh-Dole? A Survey of IP and Technology Transfer Policies in Emerging and Developing Economies
by Gregory D. Graff
Abstract
Global Health: Lessons from Bayh-Dole
by Rachel A. Nugent, Gerald T. Keusch
Abstract:
Public sector institutions help deliver public health goods. By extension, universities that receive public research funds must deliver a benefit to the public that goes beyond licensing a discovery to the private sector for development. In the United States, 25 years of experience with the Bayh-Dole Act, which governs the use of intellectual property (IP) derived from public research, offers both lessons and warnings for developing countries currently establishing their own IP systems. Bayh-Dole successfully created a large body of IP from publicly funded research. Absent a strong profit motive for the private sector, however, the Act has been much less successful at producing public goods for health. Current practice undervalues the “public benefit” aspect of the mandate, especially for the poor. Possible ways to address this mandate would be for public sector entities (and their academic partners in the biomedical sciences) to invest some of their earnings from licensing publicly funded discoveries into programs for neglected diseases of the poor. IP rights from public funded research could also be leveraged in negotiating licensing agreements with the private sector to address these neglected diseases. IP laws and institutions should be designed to encourage such sharing. The public and academic research sectors should also seek a new compact with the private sector aimed at reducing the burden of disease affecting the poor.
Abstract
Public Sector IP Management in the Life Sciences: Reconciling Practice and Policy—Perspectives from WIPO
by Antony Taubman, Roya Ghafele
Abstract:
This chapter reviews the options for effective public sector management of intellectual property (IP) in the life sciences, focusing on the need for a judicious, pragmatic choice of options along two axes: (1) deployment of exclusive rights over technology and (2) use of market mechanisms to bring a new technology to the public. The essence of public sector IP management is finding the right settings along these two axes that will deliver tangible outcomes in line with defined public-interest objectives. Experience shows that ex ante assumptions about how to gain optimal leverage from exclusive rights, and the appropriate degree of reliance on market mechanisms, are unlikely to serve a public sector IP manager well. In clarifying objectives and the practical means of achieving them, pragmatic coordination between the practical and policy levels is essential. Public sector IP managers are more likely to be assessed against public interest expectations than their private sector colleagues. In IP management in the life sciences, policy and practice are ultimately two sides of the same coin; practitioners cannot hope, expect, or plan to operate outside the broader policy perspective. Policy-makers therefore need to consider the actual practice of IP management when assessing a policy framework for innovation in the life sciences. IP managers should be open to using legal mechanisms flexibly for inclusion, or exclusion, as required to achieve their goals. Finally, managers should seek mechanisms to pragmatically structure and promote partnerships with those who have the resources necessary to bring life-sciences innovation to the public. Such partnerships may be centered in the public, philanthropic, or private sectors, but more likely fall into a hybrid mix of these categories.
Abstract
The Role of Clusters in Driving Innovation
by Peter W. B. Phillips, Camille D. Ryan
Abstract:
The promise of biotechnology relies on new science that is increasingly complex and specialized and depends on sophisticated, global intellectual property rights systems. This complexity requires a more open system of knowledge sharing than previous research and development programs. Studies suggest that successful innovation requires developing clusters of institutions, businesses, and personnel. “Location, location, location,” the battle cry for property realtors everywhere, is increasingly becoming the key phrase in studies of innovation dynamics and knowledge-based growth. Offering an overview of recent research on clusters in Canada, this chapter suggests that governments have an important role to play in the process of cluster formation and that ensuring a mix of “local buzz” and “global reach” is part of the recipe for success.
Abstract
Technology Transfer Snapshots from Middle-Income Countries: Creating Socio-Economic Benefits through Innovation
by Susan K. Finston
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This chapter examines the outcomes of technology transfer policies adopted in the past 20 years by five middle-income countries: Brazil, India, Ireland, Israel, and Jordan. The outcomes in those countries suggest that nations whose governments enable the assimilation of new technologies grow faster, create more jobs, and reduce poverty levels. The outcomes suggest also that a mixture of government and market strengths are needed to efficiently use technology transfer. Without this balance, technology transfer will have limited effects.
Abstract
The TRIPS Agreement and Intellectual Property in Health and Agriculture
by Jayashree Watal, Roger Kampf
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This chapter sets out the provisions of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) as related to intellectual property in health and agriculture and the policy work done in the World Trade Organization (WTO). The first part focuses on matters related to public health, including the protection of patents and undisclosed information. An overview is given of the three key instruments addressing the flexibilities available to Members of the WTO: the Doha Declaration on the TRIPS Agreement and Public Health, the Decision on the Implementation of Paragraph 6 of this Declaration, and the Protocol amending the TRIPS Agreement. The second part looks into TRIPS provisions relevant to agriculture and sets out the issues reviewed in the Council for TRIPS with respect to optional exclusions to patentability and the protection to be given to plant varieties. The second part also addresses work related to the relationship between the TRIPS Agreement and the Convention on Biological Diversity (CBD), including the suggested introduction of a disclosure requirement into the patent system, as well as the protection of traditional knowledge. In addition, two issues relating to geographical indications are taken up, namely, the ongoing negotiations on the establishment of a multilateral register of geographical indications for wines and spirits, and the extension of the higher level of protection currently available for wines and spirits to other products. To complete the picture, the third part discusses WTO programs aimed at enhancing capacities in the developing world with respect to the TRIPS Agreement.
Abstract
U.S. Laws Affecting the Transfer of Intellectual Property
by Howard Bremer
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This chapter provides an overview of some of the legislative bills that have profoundly affected the evolution of technology transfer and intellectual property (IP) rights in the United States. The chapter references provisions of the specific bills as codified in U.S. law and explains their goals and historical circumstances. While not an exhaustive presentation of all of the bills that have contributed to laws governing IP, the codification references will provide a useful starting point for those researching the applicability of the laws to particular situations.
Abstract
What Does It Take to Build a Local Biotechnology Cluster in a Small Country? The Case of Turku, Finland
by Kimmo Viljamaa
Abstract:
There seem to be new biotechnology initiatives springing up in almost every country and every region, no matter how big or small. This is the case for both developed countries and many developing countries. At the same time, many studies seem to suggest that the industrial dynamics of the biotechnology sector strongly favor only a few globally important locations. These are characterized by well-established relations between small R&D companies and the presence of venture capitalists, big multinational corporations, and service providers. The tendency of biotechnology clusters to form in certain locations raises some questions. Can all these new initiatives be successful? Can biotechnology research clusters develop and prosper on a smaller scale? The aim of this chapter is to discuss ideas for building successful biotechnology clusters in less-developed places. Using the example of Turku, Finland, the chapter analyzes how public policy and local activity can “fill the gaps” in the innovation system, thereby facilitating the emergence of a biotechnology industry. Although this case study is from a developed country, many developing countries face similar challenges to those Turku has faced.
Abstract
Access and Benefit Sharing: Understanding the Rules for Collection and Use of Biological Materials
by Carl-Gustaf Thornström
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The rules that govern the collection and use of biological matter have changed dramatically in the last 15 years. Arising out of the Convention on Biological Diversity (CBD), the Access and Benefit-Sharing (ABS) project applies to research carried out for either purely scientific or commercial reasons, for which organisms or parts thereof and/or related traditional knowledge are obtained from countries that are party to the CBD and their local and indigenous communities. Other agreements have added new ABS legislation to govern the acquisition and use of biological material and related information. Everyone—including tourists, nature conservationists, scientists, photographers, and journalists—is subject to these new regulations. But scientists and researchers who seek to access and use proprietary genetic resources, biological matter, and related information (such as traditional knowledge and farming know-how) are especially affected by the ABS project. It is essential for scientists and researchers to understand the fundamental principles of ABS. This includes knowing the relevant rules, regulations, laws, customs, and conditions for benefit sharing in the country where one intends to conduct research and/or collect samples. One must carefully plan ahead for any such activities by contacting key organizations and filing the proper documentation. Lack of planning may lead to unfortunate and undesired outcomes, including fines, imprisonment, deportation, and denied future access. Planning is critical.
Abstract
Biotechnology Patents and Indigenous Peoples
by Dennis S. Karjala
Abstract:
How do biotech patent systems affect indigenous peoples, particularly in relation to health products? This question raises two distinct issues. First, the question of biopiracy—to what extent do patent systems necessarily exploit traditional indigenous knowledge to produce valuable medicinal products? Second, the question of patenting gene-sequence and gene-product information taken from living organisms, especially human beings—how can we justify patenting naturally occurring substances? And how should we negotiate the myriad ethical issues that arise from doing so? This chapter argues that the core of the biopiracy problem is not the availability of patents based on traditional indigenous information but rather the unfair acquisition of knowledge and the inequitable sharing of profits derived from developing such information into a valuable product. Solving this problem requires ensuring that traditional information is fairly acquired and that fair compensation is paid to the group from which the information derives. In regards to patenting gene-sequence and gene-product information, this chapter concludes that such issues equally affect indigenous and nonindigenous populations and that the best way to address them is by making policy changes.
Abstract
Building Product Innovation Capability in Health
by Richard T. Mahoney
Abstract:
This chapter presents a theoretical framework to explain the role of intellectual property (IP) in innovation and applies the framework to the growth of the pharmaceutical industry. Developing countries progress through stages of capability to reach the status of Innovative Developing Country (IDC). To reach the status of an IDC, countries need to give concerted attention to six components of product innovation: R&D in the public and private sectors, regulatory mechanisms for drugs and vaccines to achieve safety and efficacy, the ability to manufacture to high standards new health technology products, national distribution systems in both the public and private sectors, international distribution systems (including supply of drugs and vaccines through international organizations such as UNICEF, the operation of global funds, and trade among countries), and systems for managing IP.
An analysis of pharmaceutical innovation in Korea’s vaccine industry concludes that its success in developing its impressive capabilities was achieved by paying close attention to all six components of innovation. Yet unknown is the extent to which the Agreement on Trade-Related Aspects of Intellectual Property will stimulate or thwart progress in the other innovation components when IP is quickly moved to an advanced stage.
Abstract
Current IP Management Issues for Health and Agriculture in India
by Kanikaram Satyanarayana
Abstract:
This chapter describes the current status of IP (intellectual property) management in the areas of health and agriculture in India with a focus on post-2005, at which time India became fully complaint with the Agreement on TRIPS (Trade-Related Aspects of Intellectual Property Rights). The major policy trends existing in India include (1) public sector expenditure for R&D is on the rise and is currently about US$5.0 billion (one US$ equals about 4 Rs); (2) pharma industry R&D expenditures were on the rise and had reached Rs 15.0 billion, or close to 4.0% of their turnover; (3) several major policy initiatives had been undertaken by the government, including the National Health Policy (2002), National Policy on Indian Systems of Medicine and Homeopathy (2002), and National Biotechnology Policy (2005). Other major initiatives to promote IP generation include the creation of a Central Drug Administration, a new national body for the registration of medical devices, a National Registry for Clinical Trials, and a law similar to the Bayh-Dole Act that provides for the sharing of IP with inventors. The Departments of Science and Technology and Biotechnology, the Council of Scientific & Industrial Research, the Indian Council of Medical Research, the Indian Council of Agricultural Research, and so forth, have initiated large R&D programs in the health sector for the generation of new diagnostics, vaccines, and drugs largely focused on current health problems of India. A few indigenous products are being tested for safety and efficacy before use in the public health system. A new thrust and focus are being given for public–private partnerships involving both national and international partners. In agriculture, besides a substantial allocation of funds for R&D, two new initiatives—the National Agricultural Innovation Project (NAIP) and the Indo-U.S. Agricultural Knowledge Initiative (AKI) were started in 2005. The NAIP is a World Bank-supported project worth approximately Rs 11.7 billion that is expected to strengthen basic and strategic research in agriculture in India. The AKI is expected to address a large number of issues including education, research services, and commercial linkages in agriculture.
Abstract
Current Issues of IP Management in Health and Agriculture in Brazil
by Claudia Inês Chamas, Sergio M. Paulino De Carvalho, Sergio Salles-Filho
Abstract:
This chapter presents Brazil’s intellectual property (IP) system and identifies relevant experiences of IP management in the fields of health and agriculture. Brazil takes advantage of the flexibilities offered by relevant international agreements, such as the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), and attempts to implement an equitable system. During the 1990s, Brazil revised its industrial property and copyright laws, and other related laws, and enacted new legislation that includes provisions for plant variety protection and for access to biological resources.
Abstract
Deal Making in Bioprospecting
by Charles Costanza, Leif Christoffersen, Carolyn Anderson, Jay M. Short
Abstract:
There is an upward trend in demand for intellectual property protection in agriculture. While international agreements exist to protect agricultural biodiversity, the specific rights, benefits, and responsibilities of parties entering into commercial agreements that involve the use of genetic resources still must be clarified. This chapter provides practical guidance for creating agreements around the use of biodiversity resources, as well as guidance that may provide valuable insights for creating similar agreements on the use of unique agricultural resources.
Abstract
Experiences from the European Union: Managing Intellectual Property Under the Sixth Framework Programme
by Alicia Blaya
Abstract:
Health and agriculture are at the very core of the European Union’s policies for socio-economic development. One of its most active efforts is the Framework Programmes for Research and Technological Development. With a specific focus on international cooperation, this is the European Union’s main financial instrument to promote and strengthen research and technological cooperation within the European Union (E.U.). Through the E.U. Framework Programmes, actors from different countries and sectors (industry, research centers, small- and medium-sized enterprises, universities, and so on) work together to improve science and create a better standard of living.
Given the massive movement of scientists and experiences exchanged through these Programmes, it seems that the E.U. is on the right track. However, these Programmes can only be used to their fullest potential when participants understand and appropriately handle the intellectual property rules governing them.
Abstract
Formation of a Business Incubator
by Edward M. Zablocki
Abstract:
Business incubators, as economic tools, have become increasingly common in the last decade and a half for stimulating local development. Incubators provide facilities and services (for example, business planning and legal, accounting, and marketing support) to catalyze small-business growth. In fact, incubated companies have a dramatically higher rate of survival than an average spinout does. This chapter explains what steps to take to set up an incubator, including the basic structure and the kinds of services generally offered. Successful incubator programs are discussed, and a helpful bibliography focused on case studies is provided.
Abstract
From University to Industry: Technology Transfer at Unicamp in Brazil
by Rosana Ceron Di Giorgio
Abstract:
This chapter discusses how Brazil has dramatically increased technology transfer and innovation through the State University of Campinas, or Unicamp. The leader in patenting and licensing activities in Brazil and Latin America, Unicamp has vaulted to this position in the short span of two and a half years through its technology transfer office, Inova. Providing background information about Brazil’s legal framework and practices, especially as it concerns the ownership of intellectual property and benefit sharing, the chapter discusses government incentives for innovation in light of Inova’s impressive results. Two successful cases of technology transfer are presented as guides to realistic expectations about investments, terms of license, and royalties.
Abstract
Genomics, Ethics, and Intellectual Property
by Gary E. Marchant
Abstract:
Ethical concerns and controversies about patenting are playing an increasingly prominent role in the development and applications of the biosciences. Despite the growing importance of ethical issues, there is currently no consensus or clarity on the ethical principles that should guide patenting of human, animal, and plant genes and cells. The three major areas of contention are: (1) whether some or all patents on genes and cells are unethical per se, based on concerns such as commodification, dignity, and similar concepts; (2) how tissue samples are collected, particularly in reference to the principles of prior informed consent and benefit sharing; and (3) how patents are used to restrict access to medical and agricultural use of biotechnology innovations. Given the lack of any agreed guiding principles for navigating these issues, policy-makers, decision-makers, scientists, and users of biotechnology have no choice but to address these contested ethical concerns using a case-by-case approach.
Abstract
How Intellectual Property and Plant Breeding Come Together: Corn as a Case Study for Breeders and Research Managers
by Vernon Gracen
Abstract:
Plant breeders and research managers need to understand how intellectual property (IP) restrictions on germplasm and traits affect freedom to operate for a breeding program. Access to patented germplasm and traits is restricted and can only be used under some form of material transfer agreement or similar contract. Patented materials have to be maintained under strict provisions of the contract. This adds to the cost of breeding, parent seed, and production programs. Moreover, maintaining separate versions and precise records of patented materials increases the number of seed lots that a program must maintain. For example, different versions of inbred lines of maize must be maintained for each patented trait. Otherwise, stacking two or more traits produces lines with each trait and also lines with every combination of those traits.
Abstract
How to Set Up a Technology Transfer System in a Developing Country
by Carlos Fernandez
Abstract:
This chapter reports the results of a recent study of the current state of technology transfer in Chile, including recommendations for the development of a new technology transfer system. Currently in Chile, few commercially viable technologies are transferred from research institutions to the private sector. This means that many universities should review their role and implement innovative ways of contributing to society.
Abstract
IP Rights in China: Spurring Invention and Driving Innovation in Health and Agriculture
by Zhang Liang Chen, Wangsheng Gao, Ji Xu
Abstract:
During its relatively brief history of IP (intellectual property) rights protection, China has achieved early success, thanks to the strengthening of governmental IP rights legislation, the establishment of an IP rights management system, the promotion of public knowledge about IP rights, and increasing opportunities for international exchange and cooperation. IP rights protection in the fields of health and agriculture has increased investment in these sectors, encouraged innovation in health and agricultural science, increased farmers’ incomes, and improved the quality of life for Chinese citizens. Dramatic increases in patent applications in China suggest that widespread implementation and greater enforcement of IP rights are stimulating inventive activity, encouraging technology transfer, and driving greater and greater innovation.
Abstract
Making the Most of Intellectual Property: Developing an Institutional IP Policy
by Stanley P. Kowalski
Abstract:
An institutional IP (intellectual property) policy forms the very foundation of IP management and, as such, serves as the starting point for a system of institutional best practices. The IP policy should be entirely consistent with the mission of the institution. Whether the role of the institution, as defined by its mission, is primarily disseminator of knowledge through teaching and publication, generator of research, technology transfer engine, or promoter of economic development through education and service and/or through technology transfer, the institutional IP policy should be drafted and enforced in a manner consistent with the mission. Doing so will bring efficiency and clarity to IP management, since all the components of the policy, including IP ownership, patenting, confidentiality, and disclosure can be written into the policy. Moreover, the intellectual property will serve the mission in a way that strengthens the institution’s credibility, reputation, and public image.
Abstract
A Model for the Collaborative Development of Agricultural Biotechnology Products in Chile
by Carlos Fernandez, Michael R. Moynihan
Abstract:
This chapter presents an operational model used by Fundación Chile to develop commercial biotechnology products. The first section highlights the challenges faced by a developing economy of which the main crops are so-called orphan crops. Fundación Chile’s experience has shown that establishing public–private collaborations and a solid international network are critical to overcoming obstacles and increasing the probability of success. Indeed, accessing various technology components and managing intellectual property and regulatory issues are serious challenges for a small, export-oriented economy like Chile, and Fundación Chile’s response has been to implement a model that includes the participation of companies and local research organizations with specific expertise at different points along the value chain. International agencies complement the activities and contributions of these local organizations. The chapter’s second section gives some specific examples of new products being developed with the new tools of biotechnology.
Abstract
Parallel Trade: A User’s Guide
by Duncan Matthews, Viviana Munoz-Tellez
Abstract:
This chapter provides guidance about parallel trade to developing country policy-makers and other stakeholders in intellectual property. What is parallel trade? And how can it be utilized to promote access to medicines and support poor farmers in developing countries? Engaging in parallel trade is an option provided by the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) under the World Trade Organization. Furthermore, the 2001 Doha Declaration on TRIPS and Public Health confirmed that developing countries could use parallel imports to support public health. As a result, developing countries can ensure access to lower-priced patented and/or branded products, such as medicines and basic agricultural inputs, by incorporating legislation to allow for parallel imports. When implementing measures to facilitate parallel trade, developing countries can establish and maintain an effective system by adequately regulating the quality, safety, and health of parallel imports. At the same time, developing countries need to prevent low-priced patented products available in their countries from entering high-priced developed country markets.
Abstract
Ten Things Heads of Institutions Should Know about Setting Up a Technology Transfer Office
by Lita Nelsen
Abstract:
Technology transfer is a rewarding process for the university, researchers, students, the business community, the public, and the professionals who make it all happen. Technology transfer brings new products, services, and jobs. But it is a complex process, one that requires sustained dedication at every level. This chapter offers advice about some of the most important policy and strategy issues: five are economic issues and five relate to implementation. The chapter concludes with a discussion of technology transfer pitfalls caused by unrealistic expectations. The chapter emphasizes the role of senior management in changing the IP (intellectual property) culture, the need for transparent conflict-of-interest policies, and the importance of sufficient autonomy and infrastructure support for technology transfer officers.
Abstract
What the Public Sector Should Know about Venture Capital
by Roger Wyse
Abstract:
Ready access to venture capital investments is vital to the success of start-up companies in the capital intensive high-technology sectors such as biotechnology. But there is a common misconception that an abundance of venture capital will spawn the formation of new companies. In fact, the opposite is true: new companies actually attract venture capital. This chapter provides an overview of the venture capital system, explains its importance, and identifies what qualities of a company make it attractive to venture capital investors. Some of the factors can be influenced by government action, so the chapter offers several ways that governments can encourage venture capital investment.
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