More universities are focusing efforts on technology transfer and industry partnerships to bring new therapies to market
Technology transfer, or the commercialization of scientific discoveries, is becoming more common in the field of hematology, with university researchers launching start-up companies or partnering with industry to bring their health care innovations to a wider audience. Hematology has seen several tech transfer success stories – from Obizur for hemophilia A (which was developed by researchers at Emory University) to Gleevec for chronic myeloid leukemia (which was developed through federally-funded research, university investigators, and industry partners).
ASH Clinical News spoke with several tech transfer officers and others involved in the commercialization process about the trend of technology transfer in hematology – how academic labs are increasingly commercializing their discoveries, and how to determine who owns what.
What Can Be Patented?
Before any diagnostic test, treatment, or drug makes it to hospital or pharmacy shelves, someone must make a discovery. The most obvious example is when a researcher develops a molecule that has a potentially therapeutic action and that eventually becomes a drug, but other new technologies like diagnostic tests, antibodies, and software algorithms can be patented and commercialized, as well.
Biomarkers, on the other hand, usually cannot be patented, John Nicosia, PhD, a licensing agent at Emory University, told ASH Clinical News. This decision was handed down from the U.S. Supreme Court in 2012, when it ruled in a case focused on a dispute over kits for testing thiopurine metabolism that biomarkers fall under the non-patentable category of “laws of nature, natural phenomena, and abstract ideas.”1
This was an important legal decision, and it was welcomed by clinical pathologists at academic medical centers. But also proved a point of frustration for researchers hoping to capitalize on discoveries. “If they do some excellent research and discover a protein in blood that can indicate the presence or the worsening severity of a disease, that is valuable information,” Dr. Nicosia said. “It could be helpful for either making a diagnostic test or enrolling patients in a clinical trial, but we can’t usually receive patent claims for it.”
The Tech Transfer Boom
While they are often responsible for the earliest discoveries, academic researchers typically do not possess the means to develop a drug, conduct clinical trials, and eventually bring it to market to benefit patients. Partnerships with commercial entities are required because of the complex logistics and high costs of contemporary drug development.
In an effort to increase technology transfer and encourage drug development, the Bayh-Dole Act, or Patent and Trademark Law Amendments Act, was passed in 1980, sponsored by Democratic Senator Birch Bayh of Indiana and Republican Senator Bob Dole of Kansas.2 Bayh-Dole allowed nonprofit and university researchers who received funding from the government to patent and commercialize the intellectual property they generated with federal funding, rather than automatically assigning those inventions to the federal government. Universities and nonprofit organizations were now free to team up with industry partners to develop campus inventions into commercial products.
December 2020 marked the 40-year anniversary of the Bayh-Dole Act. Its introduction spurred a “tech transfer boom” among U.S. universities and academic centers. Organizations formed entire departments of staff dedicated to guiding the technology transfer process, purchased acres of land to develop startup incubators, and partnered with venture capitalists, companies, and communities to build startup laboratories.
According to AUTM (formerly known as the Association of University Technology Managers), during the nearly two decades from 1996 to 2015, technology transfer from academic institutions has supported 4.3 million jobs and contributed up to $591 billion to the U.S. gross domestic product.3 “In addition to boosting the nation’s economy, the early momentum created by Bayh-Dole fundamentally changed public perceptions about the importance of university technology transfer and its role in generating revenue to support the academic research enterprise,” the agency stated.
According to a Nature Biotechnology article, there were more than 80 “innovation districts” supported by U.S. universities in 2014.4 Many of these districts, such as the Buffalo Niagara Medical Campus, the Cleveland Health-Tech Corridor, the Innovation Quarter in Winston-Salem, the Midtown Innovation District in Atlanta, Philadelphia’s University City District, and Research Triangle Park in North Carolina, have focused their energies on understanding and combatting COVID-19.5
Who Owns What?
Whether a new discovery comes from an industry sponsorship or federal research funding, “there are a few strings attached to it,” Dr. Nicosia noted.
“The spirit of the Bayh-Dole legislation was to use taxpayer dollars to grow the biomedical industry in the U.S. and result in therapies that affect the American public,” he said. So, if the federal government provided the funding, the technology transfer officers are required to give preference to U.S. partners over international partners, and smaller companies over larger companies. If a pharmaceutical or biotech company sponsored the research, it would generally have the option to exclusively license the technology before it is offered to anyone else.
In return for the rights to their intellectual property, “federally funded nonprofit organizations are expected to file for patent protection and to ensure commercialization upon licensing for the benefit of public health,” explained Veena Krishnappa, PhD, DVM, Venture Director at Cambrian Biopharma in New York. If the organization does not elect to retain a title to its invention, then the rights revert to the federal funding agency.
This clause was designed to ensure that the discoveries make it into the hands of U.S. taxpayers. If a company took the patent rights but never developed the technology, letting it sit on the shelf to prevent competing companies from using it, the government can “march in” to take back the rights or force the license to a third party that would actively develop and commercialize the technology.
“It is an embarrassment to have a federally funded taxpayer dollar invention licensed by pharma but never developed,” said Mark Wisniewski, MS, MBA, Senior Director of Biopharmaceuticals at the UCLA Technology Development Group. “It is one of the main things that we put into licensing agreements to ensure that the intellectual property is continually being developed.”
To date, the government has never used these march-in rights, but Dr. Nicosia said they exist as a safeguard for federally funded research. The conversation around march-in rights is growing louder, though, and he said that the federal government may take a more active role in technology transfer over the next few years. In 2020, groups such as Doctors Without Borders and Universities Allied for Essential Medicines have pushed for governments to invoke march-in rights on COVID-19 drugs and tests to prevent industry price gouging.6
How a Discovery Becomes a Patent
To effectively evaluate discoveries for potential commercialization, most universities now employ technology transfer officers who oversee patent filing and arrange industry partnerships to develop the technology for the clinic. These professionals work closely with university scientists. In his role, Dr. Nicosia said, “I try to build close relationships with the researchers I work with to make sure that I’m aware of what is going on in their lab.”
When the researchers think they have something that could be commercialized, tech transfer officers ask them to fill out an invention disclosure form describing the invention, the problem it might solve, its stage of development, its technical applications, any publications related to it, and the scientists’ potential conflicts of interest and funding sources.
Mr. Wisniewski said the tech transfer team at his institution encourages investigators to err on the side of caution. “If they think they have something, it’s better to submit it,” he said. “Because, as most people know, once you publish, then you begin losing your rights to patents very quickly.”
After reviewing the form, the tech transfer officers decide if they should pursue a patent. If so, they coordinate the patent prosecution, beginning with contacting the in-house patent counsel responsible for drafting the patent application.
Next, a marketing team works to find potential industry partners or investors to license the intellectual property and develop the technology. Once these potential partners are identified, tech transfer officers execute confidentiality agreements and arrange meetings between the researchers and the company.
For a discovery to be patentable, it must be novel and have the potential to address an unmet medical need. The possibility of monetization is a bonus, according to Judith Gasson, PhD, Professor and Director Emerita and Senior Advisor to UCLA’s David Geffen School of Medicine for Research and Innovation. Dr. Gasson also is a member of the board of directors for the UCLA Technology Development Group. “If we generate a revenue source, that’s great, but that isn’t what’s driving this process,” she said. “What’s really driving this process is whether we think we have science on campus that can help to address an unmet medical need. If we do, how can we do everything possible to support that laboratory into translation and commercialization?”
While she says that creating revenue isn’t the primary goal, Dr. Gasson added that the university is “an enormous stakeholder” in tech transfer activities. “A few years ago, we had a 4% royalty interest in a pharmaceutical known as enzalutamide that was developed here on campus by two of our faculty members,” she recalled. “A monetization process occurred that generated something on the order of $1.4 billion, which has been used to fuel activities all over campus, including innovation funds, but also student, educational, and research activities.”
The investigator and the university staff aren’t the only stakeholders. In some cases, industry-sponsored research agreements are in effect prior to a discovery. “This occurs when an outside biopharma company funds a proposal or project in the lab,” said Mr. Wisniewski. “A company that has licensed intellectual property from a lab in the past might say, ‘We want to keep the inventors involved, so let’s sponsor more research in their lab.’ It keeps the investigators involved, then adds on to that initial intellectual property.”
Obizur, or antihemophilic factor [recombinant], porcine sequence (rpFVIII), was approved by the FDA in 2014 to treat hemophilia A. It is one of the early success stories of Emory University’s Office of Technology Transfer.7 The department’s Executive Director, Todd Sherer, PhD, described its approval as a story of “perseverance on the part of the inventors, the companies, and Emory itself. [The drug’s] long and twisting road from discovery to market [is] a prime example of how complex it can be, … but also how great an impact research can have on patients’ lives.”
It began with Emory hematologist Pete Lollar, MD, and his team studying coagulation in the early 1990s. To do so, they developed a modified form of factor VIII. Upon realizing that it could be used to treat patients with hemophilia who gave antibodies that prevent the natural form of factor VIII from functioning properly, Dr. Lollar filed an invention disclosure form in 1992. In 1998, the technology was licensed to an Emory startup called Octagen, which was founded by Dr. Lollar and a business partner. The company was bought and sold several times, and the rights to the drug eventually landed in the hands of Baxter International. Baxter completed development and the drug was officially FDA-approved in December 2014.
A Look to the Future
Dr. Nicosia has handled patent law for therapeutic or diagnostic inventions and is now working on unique technology partnerships with Emory researchers. One such partnership is around a project on “vasculature on a chip”, which could allow researchers to see how individual patients’ blood vessels might respond to treatments. Handling these patent laws is a bit more challenging, though. “This is exciting, space-age kind of stuff, but it’s difficult to say ‘OK, here’s a discrete piece of technology that we can file a patent on.’ We have to be a bit more creative to find these partnerships,” he said. “Having different patent rights and then licensing and letting a company take that away? It’s not going to be that clean in these types of scenarios.”
One possibility is licensing the technology to companies that specialize in particular areas of research. For example, if a company specializes in cancer research, Dr. Nicosia could negotiate a deal by which that company could use the tool to research cancer therapies, while another company could use it in another disease state.
At UCLA, Dr. Gasson described the recent decision to revamp the university’s technology transfer office. About 5 years ago, UCLA’s business school reviewed the office’s tech transfer strategies, which “resulted in a radical change in the structure of the technology development group,” said Dr. Gasson. “It also involved the creation of a new board of volunteers who sit between Mark Wisniewski and his officers in the technology development group and the chancellor’s office, the deans, and the leadership.”
The newly integrated team has had so much success, she said, that they have been able to gain the interest of prominent venture capitalists and advisors from biopharma. The university has launched nearly 100 startup companies across life sciences and physical sciences.8
Even before the restructuring, UCLA’s tech transfer program led to the development of the Gleevec Pharmacogenomic Test, after university researchers discovered mutations that predict which patients with chronic myeloid leukemia (CML) are likely to respond to Gleevec (imatinib).9 Imatinib is itself another tech transfer success story that began with National Cancer Institute−funded research in the 1970s, was propelled by partnerships between investigators at Oregon Health and Science University and the Swiss pharmaceutical company Ciba-Geigy (which later became Novartis) in the 1990s, and ended with approval of a life-changing therapy for patients with CML in 2001.10
The success stories are accompanied by plenty of failures, Dr. Krishnappa noted, most of which involve conflicts of interest. “Conflicts of interest are real and need to be evaluated by an office of compliance or similar entity, which are typically part of an institute or university,” she said.
Conflicts of interest are an expected part of research and commercialization efforts. A licensed technology creates a potential revenue stream, and that revenue can be influenced by ongoing research using that technology. If inventors, investors, or anyone else who could benefit from the technology’s commercial success is also involved in the research, a conflict is created.11
Dr. Krishnappa outlined the following example: Instead of licensing technology to a company, an investigator puts up his or her own funds or receives funding from an investor to start a company. In this case, the investigator would be on both sides of the negotiation, because they would have a financial interest in the company, but would also be receiving revenue as the inventor.
Dr. Nicosia recommended a two-pronged approach to avoiding the conflict that arises when an inventor starts a company with technology that was developed with outside funding. First, the inventor should not personally be a part of the negotiating process. “They need some kind of business partner or legal representative to negotiate that license for them,” he said. “Second, the technology transfer office can make sure that the technology is licensed for fair market value.”
Mr. Wisniewski emphasized that, “with a growing ecosystem, we want to have the parties engaged and understand how to develop therapeutics, especially if they are funding their own companies.”
To avoid controversies over conflicts of interest in tech transfer relationships, Dr. Gasson had the following advice: “Disclose, disclose, disclose.” —By Emma Yasinski
- U.S. Supreme Court. MAYO COLLABORATIVE SERVICES, DBA MAYO MEDICAL LABORATORIES, ET AL. v. PROMETHEUS LABORATORIES, INC., No. 566 (March 20, 2012). Accessed December 9, 2020, from https://www.supremecourt.gov/opinions/
- National Institutes of Health. Bayh-Dole Regulations. Accessed December 9, 2020, from https://grants.nih.gov/grants/bayh-dole.htm.
- AUTM. Guiding Principles of Technology Transfer. Accessed December 9, 2020, from https://autm.net/about-tech-transfer/principles-and-guidelines.
- Huggett B. Reinventing tech transfer. Nature Biotech. 2014;32:1184-1191.
- Brookings. How ‘innovation districts’ are continuing the fight against COVID-19. Accessed December 9, 2020, from https://www.brookings.edu/blog/the-avenue/2020/04/28/how-innovation-districts-are-continuing-the-fight-against-covid-19/.
- STAT. Exercising Bayh-Dole march-in rights would handicap Covid-19 innovation. Accessed December 9, 2020, from https://www.statnews.com/2020/05/04/bayh-dole-march-in-rights-handicap-covid-19-innovation/.
- Emory University. Obizur: A Life Saving Treatment for Acquired Hemophilia Twenty Years in the Making. Accessed December 9, 2020, from http://www.ott.emory.edu/about/success/Obizur.html.
- UCLA Technology Development Group. UCLA Startups. Accessed December 9, 2020, from https://tdg.ucla.edu/industry-investors/ucla-startups.
- UCLA Technology Development Group. Accessed December 9, 2020, from https://tdg.ucla.edu/biomarkers-identify-best-treatment-options-leukemia-patients.
- National Cancer Institute. How Imatinib Transformed Leukemia Treatment and Cancer Research. Accessed December 9, 2020, from https://www.cancer.gov/research/progress/discovery/gleevec.
- University of North Carolina. Conflicts of interest in technology transfer. Accessed December 9, 2020, from https://otc.unc.edu/inventors/patents-
AUTM published “Nine Points to Consider in Licensing University Technology,” in 2007, which included guidelines developed by representatives from the Association of American Medical Colleges and several licensing directors, to “encourage our colleagues in the academic technology transfer profession to analyze each licensing opportunity individually in a manner that reflects the business needs and values of their institution, but at the same time, to the extent appropriate, also to bear in mind the concepts articulated herein when crafting agreements with industry.”
- Universities should reserve the right to practice licensed inventions and to allow other non-profit and governmental organizations to do so
- Exclusive licenses should be structured in a manner that encourages technology development and use
- Strive to minimize the licensing of “future improvements”
- Universities should anticipate and help to manage technology transfer related conflicts of interest
- Ensure broad access to research tools
- Enforcement action should be carefully considered
- Be mindful of export regulations
- Be mindful of the implications of working with patent aggregators
- Consider including provisions that address unmet needs, such as those of neglected patient populations or geographic areas, giving particular attention to improved therapeutics, diagnostics, and agricultural technologies for the developing world
Source: Association of American Medical Colleges, AUTM, “In the Public Interest: Nine Points to Consider in Licensing University Technology.”