The Value of Innovation and Intellectual Property in the Opportunity Economy

While the COVID-19 pandemic remains a public health and economic concern, companies are adapting and adjusting, finding new and better ways to do business moving forward. Womble Bond Dickinson is taking a comprehensive look at this new Opportunity Economy from a wide range of viewpoints. Recently, Oxford University Innovation COO Dr. Mairi Gibbs, UC Berkeley Chief Innovation & Entrepreneurship Officer Dr. Rich Lyons and Womble Bond Dickinson IP Litigation attorney Dr. Chris Mammen discussed innovation and intellectual property in the Opportunity Economy. The discussion took place with Womble Bond Dickinson attorney Mark Henriques on an episode of the “In-house Roundhouse” podcast, and the Q&A article below is based on that conversation. This episode of the podcast was jointly sponsored by Womble Bond Dickinson, the Berkeley Center for Law & Technology and the Oxford Entrepreneurs Network.

Takeaways

• University research is focused on long-term, widespread society impact. Increasingly, research institutions are leveraging the free market economy to advance and promote the work researchers are doing. The Oxford/AstraZeneca COVID-19 vaccine is one shining example of a research university working with the private sector to effectively address a major public health challenge. 
• IP rights are a critical component of monetizing innovation. However, IP protections can be at odds with academic concepts of open source knowledge and peer-reviewed publication. Universities must work across departments to serve all stakeholders.
• Creating a university ecosystem that supports innovation goes far beyond the research departments. Universities that are successful in this effort, such as Oxford and UC Berkeley, do so with the buy-in of many different departments, including non-academic units.

If ideas are the fuel of the Opportunity Economy, universities are the oil wells and refineries where ideas transform into innovation. Such innovation—with the power to transform lives and improve society—are the most valuable commodities a business can have. 

And as scientists at research universities focus on developing such life-changing ideas, intellectual property attorneys and business development professionals at the same universities work to protect these innovations and introduce them into society at large. In the Opportunity Economy, innovation and intellectual property matter more than ever.

CM: “How do universities foster innovation while protecting IP in the global economy? What trends may strengthen (or weaken) the US and UK systems?”

MG: “Oxford’s goal is to maximize the global impact of research and expertise. The goal doesn’t involve the economy per se – that’s an output. It’s all about getting that research out of the university and used for the benefit of society. Impact for the public benefit is also driven by the UK government through our Research Excellence framework.”

RL: “At the end of the day, it’s about impact…The reason we exist is long-term impact. The ‘How’ is the research, teaching and service. That’s a fundamental point that’s often missed.”

MG: “To achieve impact, Oxford has a broad approach. Any mechanism is fine as long as it gets the research out there—licensing, sponsored research, consulting, speaking engagement, museum exhibits, public events, etc.”

RL: “I see my role as platform-building to expand the capacity to deliver on impact. Some of that is programmatic, and some is financial. All of us have gotten a lot better over the past 10 or 20 years, and there’s still a lot of headroom.”

MG: “There also has been a long investment by the university in its innovation infrastructure. For example, we have incubators for start-ups and Oxford Science Enterprises (formerly OSI), an investment service. Oxford portfolio companies raised over £1 billion in 2020.

“Oxford Science Enterprises has had an outstanding capitalistic effect on the Oxford ecosystem. Our spinout numbers jumped from eight to 12 per year to 15 to 20 per year. Oxford Science Enterprises also brought in other investment money and raised the profile of Oxford innovation as investment opportunity.

“One of our biggest successes has been the development of the Oxford/AstraZeneca COVID-19 vaccine. More than 1 billion doses of the vaccine have been administered to date. To make that happen, we had to have huge involvement from many areas of the university, from the Vice Chancellor down.” 

CM: Mairi discussed Oxford Science Enterprises as Oxford’s investment partner. Does UC have a similar arrangement?”

RL: “Yes. We launched a new category of VC funds in which 10 percent of the total carry comes back to UC directly and gets reinvested. We also just launched our Equity Solutions Group. This group is thinking about what new channels through which Berkeley can receive equity participation for some of the relationships it has.”

CM: “We’ve both been talking about the ecosystem & community in a way that’s broader than just the university. What are the other players in the ecosystem?”

MG: “This isn’t just a story about the university. Our ecosystem includes multiple universities, research facilities, hospitals, start-ups, tech companies, big corporates, legal teams, etc. In addition, many university researchers work as consultants with the private sector.”

CM: Are spinouts staying near the universities?

MG: “Around 90 percent stay in the Oxford area. Especially in the early years, a lot of them stay local. Oxford Instruments has been here since the 1950s!”

RL: “Yes. Companies tend to stay in the Silicon Valley/Bay Area. But there’s a geographic frame on the question, and also a stakeholder frame…The boundary around Berkeley is getting fuzzier for really productive reasons. Our interoperability as a university is changing. For example, we launched Berkeley RIC (Research Infrastructure Commons), a collection of shared services and facilities that is available for commercial use. What is the capacity utilization of a mass spectrometer or DNA sequencer on the weekend at Berkeley? Often, not very high at all. How do we create an efficient way for start-ups in our ecosystem to access our infrastructure? Building platforms that create even more interoperability with Berkeley is what we are trying to do for our stakeholders.”

CM: The mind boggles at being able to get access to major university resources during slack times. It’s a fantastic idea! So what does the university do to encourage commercialization of innovations? 

MG: “There are so many different aspects that go to encouraging university staff and students. It needs a clear policy framework, a buy-in from senior leadership and a commitment to building that culture and strategy of innovation. You need skilled people to support those activities, and you need fantastic, cross-disciplinary research that tackles really big problems. If you haven’t got anything fundamentally interesting, it’s going to be difficult to shout about it in the world.

“We try to celebrate success, we have the Vice Chancellor’s Innovation Awards. We have the IDEA Program, trying to encourage greater diversity in our entrepreneurial system. And we do periodic reviews. If we think of anything else we need to be doing, then we build some consensus and try to make it happen.”

RL: “About 10 years ago, we started something called the Bakar Fellows Program. The program provides substantial grants that faculty—mostly STEM faculty—compete for, and the grants fund downstream research and get faculty thinking about commercialization. Not necessarily to get faculty to become entrepreneurs themselves, but getting this work projected into society is what we do as a university. It’s as much about culture change as it is funding. During the most recent cycle, 42 faculty applied for seven awards.”

CM: “Let’s turn to IP rights, in particular patenting. As an IP lawyer mostly in the private sector, one of the things we often come across is the challenge of in-house lawyers getting scientists at R&D firms to engage in innovation harvesting. How do you approach this challenge?”

RL: “It’s an old question, and it’s still a complicated question.  We need people who are dedicated to this. There’s a structural trend against keeping this strong, and we’re trying to be more intentional about this. We just created an Innovation Fellowship, open to doctoral students or post-docs. Venture capitalists have employed students as scouts for innovation for a long time. The idea behind these Innovation Fellowships is ‘Let’s get buy-in from the leaders of the labs themselves.’ These are people with scientific credibility and access to what is going on in the labs. We’re hoping the right talent, coupled with a higher level of access, can push this further.”

MG: “It’s an interesting question of when to patent. We don’t do technology audits—it’s just not going to produce a good outcome, but we try to make enough noise so that everyone in the university knows how to find us. We do regular drop-in sessions in different departments, IP awareness type sessions, so that anyone who wants to find us knows how…. In the UK, we have a first-to-file system, where we don’t have a grace period—and researchers love to publish. We tell our researchers to come talk to us early in the process, when they are pulling together information for a first draft, so that we can get ourselves organized and get a patent attorney involved, so that the patent application can be filed before first publication. We never want to tell them they can’t publish.”

RL: “The culture within the life sciences – researchers are used to patenting. But in computer sciences, it’s an open source world. Without creating friction in the system, can we patent it so that we can have some control over how the technology is used? The culture across our faculties is very different.”

MG: “We try to find solutions that allow other researchers to use work for free, but charge companies that wish to use it commercially.”

CM: “That’s an important part of educating primary researchers on the various aspects of IP protection. What is the biggest challenge for innovation in near- to intermediate term?”

RL: “Can a faculty get an extra year to go on leave to start a company? It’s really costly for certain players within a university to go on leave in order to get a company on a roll. We can talk about culture change, but at the end of the day, these sources of friction will take some more conversation.”

MG: “We have huge ambitions and expectations. The challenge is scale for me. We have to be able to scale without losing that curiosity-driven research.”

MH: “Since I have two such engaged, smart people here, I have to ask, ‘What is the emerging trend in innovation?’”
 
MG: “Climate is going to affect everything. It affects economics, health, then there’s the ethics of access to water and a temperate climate to live in. Climate is about to be everything.”

RL: “Yeah, that’s an important answer. Consistent with that, it’s convergence. We’ve just created a really big convergence incubator to address that. It’s life science mashed up with AI, mashed up with engineering. We’ve been talking about interdisciplinary collaboration for a long time, and the magic is in the mash-ups. We are working on creating institutional platforms to support that.”