University Times

What do a new coating for plastics, which can make football helmets, surfboards and industrial polymers stronger, and a new tuberculosis diagnostic, which can possibly help stem the return of the disease, have in common? They were both invented by members of the Pitt faculty.

But that is not all. They also have been patented and/or licensed with assistance from the Office of Technology Transfer and Intellectual Property, which over the past two years has nearly doubled the number of patents and licensing agreements held by the University, and brought in more than $4 million in fees and research grants.

"We are very, very pleased with those results," says Fran Connell, director of the Office of Technology Transfer and Intellectual Property. "It has been a very long labor." While happy that her office is generating income for Pitt, Connell said her real satisfaction comes from seeing the research efforts of faculty members, some of whom have been working on projects for years, become reality in the larger world. Connell has found it to be particularly satisfying when the invention involved can save a life, such as the cancer therapeutic technology she recently helped to license.

"I think the best thing is that these things are out there and become a reality and make a difference in people's lives," she says. "That is what we are most excited about." The Office of Technology Transfer and Intellectual Property is an outgrowth of the Office of Research. Its roots go back to 1984, when Congress passed the Bayh-Dole Act permitting universities to hold title to inventions and discoveries that result from federally funded research.

After Congress passed the Bayh-Dole Act, the University created the Office of Intellectual Property to help faculty members obtain patents for their inventions and discoveries. However, Connell points out, that office was not very active in pursuing licensing agreements. And without commercial licensing agreements that permit a company to market an invention, new technologies and processes essentially end up sitting in a file. Neither the public nor the University gains any benefits from them. In fact, the University actually loses money because it can cost $20,000-$25,000 to obtain a patent.

"That's a lot of University money going out there and not a lot of ways to recoup it if the products or the designs or the ideas encompassed by those patents are not being developed into real commercial kinds of things," Connell points outs. "We also have a kind of failure because we are not making those things available to the public." The change in Pitt's administration in 1991 led to an increased effort to make commercial use of patents developed by Pitt faculty. In fall 1992, the Office of Intellectual Property was renamed the Office of Technology Transfer and Intellectual Property to indicate a more active approach, and Connell was named director.

Among the first moves undertaken by the revamped office was a streamlining of the forms that faculty have to deal with to have the University consider their invention or discovery for a patent. The forms were cut from dozens of pages to a half dozen.

Connell's office also reduced the number of signatures needed to proceed on a patent, changed the review process to determine if something should be patented and established an interdisciplinary review committee of 20 people that meets regularly.

"We pretty much did a soup to nuts revision," she says, "starting with the name of the office, user friendly documents, cutting down on red tape, and establishing a committee that meets regularly every month of the year except August so that invention discourses can be rapidly addressed." After the review committee approves an invention for patenting, it goes to outside patent counsel, which includes firms in Pittsburgh, Washington, D.C., and New York, that work on the application. The process can take several years.

While the patent process is going on, the Office of Technology Transfer and Intellectual Property begins work on licensing the invention or process to commercial parties.

"We've had licenses that started out at the core technology for a new company that is being formed around it, going all the way up to licenses with multinational pharmaceutical companies," says Connell.

Sometimes, according to Connell, linking an invention or process to a company that wants to market it is "like looking for a needle in a hay stack." At other times, though, three, four or five companies might compete for the rights to an invention or process.

The Office of Technology Transfer and Intellectual Property's more aggressive approach to patenting and licensing faculty's inventions and discoveries has brought a dramatic increase in the number of patents filed by the University. From the time the Bayh-Dole Act was passed in 1984, until the revamping of the Office of Technology Transfer and Intellectual Property in 1992, a total of 15 licensing agreements involving inventions and processes developed by Pitt faculty were signed. Since the reorganization of the office two years ago, that number has grown by 22 new licensing agreements and Connell expects to add another seven or eight in the near future. Another 12 technologies are being reviewed by a variety of companies to determine if the companies have an interest in marketing them commercially.

Of the financial rewards derived from all that activity, Connell says that the University earned some $320,000 in 1992 and about $540,000 in 1993. She feels that licensing agreements should bring in another $500,000 in 1994, a figure that she expects to jump to $1 million in the near future, possibly even this year.

In addition, about half of the 22 new licenses have companion research agreements that provide funds to faculty members for further research on the technology involved. The total per year currently is about $3 million.

Still, Connell says the money is not the pot of gold at the end of the rainbow. "Of course, there is money associated with it, but there also is expense associated with it. There is offsetting patent expenses and for some of the licenses it will be years before we actually see royalties out of them." Once a license agreement is signed, Connell says it is the beginning of a long-term relationship with the commercial developer. Most agreements last at least the life of the patent, which is 17 years, and royalties might not be payable in the first five or six years of the agreement.

Being a licensed attorney who spent 15 years of her professional life in corporations, Connell negotiates all of the agreements herself, which both helps to hold down costs and speed up the process. Before a contract is signed, however, it is reviewed by the attorney from the University of Pittsburgh Medical Center or the general counsel's office, depending upon which division of the University originated the invention or process.

At the moment, most of the new technologies being licensed through the Office of Technology Transfer and Intellectual Property are coming from the medical center. Along with the tuberculosis diagnostic already mentioned, they include a technology that may be used in the treatment of cardiovascular diseases, trauma, shock and other emergency room cases, and a cancer therapeutic technology.

Other departments of the University that have produced several inventions or discoveries for which licensing agreements have been signed include engineering, chemistry and biological sciences. Because of restrictions contained in the licensing agreements, Connell cannot talk in detail about any of the inventions. But she says they include, along with the plastic coating previously mentioned, a computer software to improve manufacturing processes, a diagnostic product to detect paralysis in quarter horses and a non-glare coating for the goggles of fighter pilots.

"Many of these technologies have many applications," she notes. "In some cases it is impossible to tell what their uses may be very early on. Companies are banking on at least one application and in the course of development may come up with several." Although a company purchases the right to use an invention or discovery for commercial purposes when it enters into a licensing agreement with the University, Connell says that the University reserves the right to use the invention or discovery for research purposes.

"The company doesn't buy a faculty member or his lab," she says. Faculty members are guaranteed the right to publish the results of their research, graduate students are free to work on their degrees and Pitt is free to use the technology or discovery within the University for research and teaching purposes.

"Those things are non-negotiable," says Connell. "And we have found, with very rare exceptions, that license customers understand this and why we are doing it and are willing to give on those issues."

–Mike Sajna