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The TR University Research Scorecard 2000

We rank the top U.S. universities in their quest for intellectual property, commercial partners and profits.

Long before Bob Dole abandoned his presidential dreams and became the unlikely spokesman for Viagra-a celebrated product of industrial research-he gave an even bigger lift to academic research. In 1980, Dole and fellow U.S. senator Birch Bayh sponsored the Bayh-Dole Act, legislation that gave blanket permission for universities to license and profit from the fruits of federally sponsored research-rights previously held by Uncle Sam.

The Bayh-Dole act turned out to be Viagra for campus innovation. Universities that would previously have let their intellectual property lie fallow began filing for-and getting-patents at unprecedented rates. Coupled with other legal, economic and political developments that also spur patenting and licensing, the result seems nothing less than a major boon to national economic growth. Behind big university patents such as Carnegie Mellon’s Lycos Internet technology and the University of Minnesota’s AIDS-fighting carbovir-along with a host of lesser technologies-campus inventions supported some 280,000 jobs and generated an estimated $33.5 billion in economic activity in 1998, the last year for which figures are available.

TR’s University Research Scorecard takes you inside this increasingly vital part of the economy, analyzing academia’s ever-increasing IP firepower using two separate rankings of top U.S. educational institutions. The first, based on data from CHI Research of Haddon Heights, N.J., assesses patenting prowess via a measure called “technological strength,” which takes into account not only patent numbers but also patent quality (See table: “Campus Patenting” on following pages). The second, based on data from the Association of University Technology Managers (AUTM), lists the 25 universities with the highest licensing revenues (See table: “Tech Transfer Riches” on following pages). Since patents generally don’t begin to generate license income until five to 10 years after a deal is signed, the two together not only show who’s ahead in the race to capitalize on university inventions, but who is coming on strong for the future.

A glance at TR’s scorecard confirms that the race is being run at an increasing clip: Technological strength was up in 1999 for 44 of the top 50 schools; patent numbers were up for all but two. Not surprisingly, the biggest players dominate the patent numbers: The University of California system, MIT and Caltech have amassed war chests of intellectual property across a range of technologies from medicine to fiber optics.

But raw patenting numbers aren’t the only significant factor when it comes to the money side of the equation, and some schools with relatively few patented inventions are reaping huge returns. Columbia, for example, ranks second in licensing income and makes nearly a quarter of its $260 million research investment back in royalties and fees, even though the school garnered only 34 patents per year on average from 1994 to 1998. Third-place Florida State University, meanwhile, rakes in an astounding 42 percent of its $112 million annual research budget through a mere 10 licenses or options deals.

The Florida State story illustrates a truth university licensing managers know all too well: All it really takes to win the financial game is one IP home run. The school’s director of technology transfer, John Fraser, puts it bluntly: “Fundamentally, we’re a one-horse operation, and that horse is called Taxol.” The anti-cancer drug, which Florida State licensed exclusively to Bristol-Myers Squibb, earned the university some $45 million of its $46.6 million in licensing income in fiscal year 1998. The school could net more than $60 million on Taxol this year.

But while that likely makes Taxol the single biggest moneymaker of all active university patents, it’s got a rival for the crown. In April, the University of Rochester won what may well turn out to be the greatest prize of all: patent rights that cover all medical uses of Cox-2 inhibitors, or “super-aspirins,” which last year beat Viagra’s record as the fastest-selling new drug in history. When TR went to press, the school was suing Searle to block sales of the drug and was moving to negotiate licensing deals with that company and other manufacturers that could easily vault the Cox-2 inhibitors to the top of the heap.

Winners like these are manna for a technology transfer office, but they’re not something a university can count on. So rather than betting on blockbusters, schools are increasingly seeking inventive ways to milk the most out of their bread-and-butter portfolios.

Take Pennsylvania State University, which currently ranks 44th in licensing income. “We are aggressively moving forward to hopefully change our success rate at capitalizing on our technology,” says Gary Weber, director of technology transfer. Those efforts include building incubator space in the university’s research park, courting venture capital as never before and signing what Weber terms “creative” equity deals.

In one striking example, Penn State bundled together three previously distinct pieces of agricultural intellectual property: a drug-delivery technology for controlling animal fertility, a chicken feed product Weber calls “poultry’s Last Supper,” which reduces E. coli contamination in slaughtered birds, and a genetic marker for “boar taint,” an odor that can contaminate the pork from male swine.

Licensed separately, none of the inventions was likely to amount to much. But united, they formed the basis of an entire new company, whimsically christened EIEICO by the venture capitalist who funded the endeavor. Penn State took an equity position in the startup.

More and more, Weber and counterparts at other universities are looking for such entrepreneurial opportunities rather than one-shot deals. For one thing, ventures like these provide a vehicle to plow money back into the university to support ongoing development of the technology-and then to get new innovations out to market even faster. In the long run, such a continuous revenue stream-from a variety of small inventions-may outperform a blockbuster patent.

Whatever tack they take, university technology managers insist that, ultimately, it’s not about an individual school’s bottom line. The real point of the Bayh-Dole Act, they say, was to stimulate the U.S. economy and to get new technologies out into the marketplace-where they can begin to impact people’s lives. Given the recent performance of the nation’s top universities, it looks like Bob Dole has more than one thing to smile about.

Campus PatentingInstitution*Technological StrengthNumber of PatentsCurrent Impact Index 1999/Rank 1994-1998**/Rank 1999 1994-1998** 1999 1994-1998**U. California476/1300/14682801.021.07MIT206/2171/21511201.361.43Caltech124/369/5103511.201.36U. Texas115/4124/3115981.001.26Stanford105/586/491651.161.32Johns Hopkins93/641/15108460.860.90U. Pennsylvania92/762/864511.441.21U. Wisconsin84/869/587620.961.12U. Washington82/945/1153321.551.42Washington U.70/1029/2060271.171.10Columbia69/1147/1059341.171.36Cornell64/1264/769520.931.24U. North Carolina59/1330/1958301.021.01Penn. State U.54/1423/2445211.201.11State U. of New York53/1545/1154410.971.09U. Michigan52/1657/958400.901.42U. Minnesota51/1740/1655350.931.14Princeton48/1822/2630161.601.34Carnegie Mellon45/1921/3026131.731.60Duke44/2042/1442331.061.27Iowa State U.41/2132/1846410.900.77U. Massachusetts41/2115/4059160.690.94U. Alabama38/2316/3744170.870.93Harvard38/2327/2249350.770.76U. Utah38/2328/2137311.020.91U. Illinois36/2613/4334171.050.75U. Pittsburgh33/2721/3041180.811.20U. Florida31/2843/1355460.570.94Michigan State U.31/2822/2654340.570.66U. Maryland31/2822/2640230.770.97Rutgers28/3127/2232220.881.24Emory28/3123/2428171.001.37Brown28/3115/401991.471.67Yale27/3416/3732210.840.74Georgia Tech26/3518/3534200.770.86U. Tennessee25/3612/4513111.941.07Baylor Coll. of Med.25/3614/4222161.140.88U. Kentucky25/3613/4332140.780.93U. Nebraska25/3616/3721221.180.74Dartmouth24/405/491052.441.08N. Carolina State U.24/4037/1725300.951.25Purdue23/4220/3323170.991.14Case Western Reserve23/4210/4729100.781.02Texas A&M22/4421/3023200.971.04U. Arkansas21/455/49328 0.660.67Ohio State U.21/4519/3425200.840.96U. Iowa21/4510/4734180.620.59U. Central Florida21/4511/461491.501.20New York U.21/4522/2628210.741.04Thomas Jefferson20/5017/3629190.680.91* includes all campuses in system; ** annual average

Technological Strength: The number of U.S. patents multiplied by the Current Impact Index (see below).
Number of Patents: The total number of U.S. patents awarded, excluding design and other special-case inventions.
Current Impact Index: A measure of how frequently an institution’s patents for the previous five years are cited in the current year, relative to all patents in the U.S. system. A value of 1.0 indicates average citation frequency.
Data from CHI Research.

Tech Transfer RichesInstitution*License Income
(Dollars x 1000)/RankResearch Expenditures
(Dollars x 1000)License Income as % of Research ExpendituresLicenses & Options Yielding IncomeU. California (system)73,101/11,709,9294.3696 Columbia61,649/2260,70023.6245 Florida State U.46,643/3112,07841.610 Stanford43,197/4401,04910.8299 Yale 33,261/5299,80011.184 Carnegie Mellon30,065/6169,90017.720 Michigan State U.24,337/7193,61112.641 U. Washington/Wash. Research Foundation21,299/8432,3834.9204 U. Florida19,145/9240,9007.955 MIT18,047/10761,4002.4267 U. Wisconsin-Madison/ Wisc. Alumni Research Foundation16,121/11362,1004.576SUNY Research Foundation12,123/12378,7923.2119Harvard8,878/13374,4472.4163 Baylor College of Medicine7,247/14207,1003.5102U. Pennsylvania7,247/14414,356 1.769 U. Michigan6,806/16491,5001.491 Tulane6,588/17 87,8587.523 Johns Hopkins5,513/18987,4640.6149 Caltech5,500/19151,0003.650 Emory5,074/20164,9003.115 Cornell Research Foundation4,798/21343,0071.463Rutgers4,749/22146,855 3.2172 Washington U.4,548/23265,3161.7106 Texas A&M (system)4,414/24393,7201.1137Clemson4,330/2590,1504.87* individual campuses unless specified

License Income: The gross license income received by the university in fiscal year 1998 minus license income paid to other institutions under agreement that year. Note: Rankings within this category reflect an institution’s standing among all 132 U.S. universities surveyed by the Association of University Technology Managers, not just the 50 ranked highest in technological strength.
Research Expenditures: Total expenditures made in support of research activities, funded by all sources including federal and local government, industry, foundations, voluntary health organizations and other nonprofits.
License Income as Percentage of Research Expenditures: The adjusted gross license income, as described above, compared to total expenditure on research activities.
Licenses & Options Yielding Income: The number of licenses and options generating license income.
Data from the Association of University Technology Managers.
All figures in this table are from fiscal year 1998, the most recent available.

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