FYI: The AIP Bulletin of Science Policy News

House Science Committee Considers Legislation on Improving Technology Transfer

Aline D. McNaull
Number 139 - September 20, 2013  |  Search FYI  |   FYI Archives  |   Subscribe to FYI

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On July 24 the Subcommittee on Research and Technology held a hearing to examine innovative approaches to technology transfer at universities, research institutes, and national laboratories.  The subcommittee also focused on a discussion draft of HR 2981, the “Innovative Approaches to Technology Transfer Act of 2013.”  The legislation would establish a grant program using funding from the Small Business Technology Transfer (STTR) program and would encourage the development of innovative technology transfer programs at universities, research institutes, and national laboratories. 

Small businesses have been a topic of discussion about the transfer of technology from research institutions to private industry.  Funding for research and development that is carried out between small businesses and a researcher in a non-profit research institution was allocated as part of the STTR program.  STTR was most recently reauthorized in the National Defense Authorization Act for Fiscal Year 2012.  In 2011, the Science, Space and Technology Committee approved H.R. 1425, the Creating Jobs Through Small Business Innovation Act of 2011, which reauthorized the STTR and Small Business Innovation Research programs. 

The draft legislation discussed in the July 24 hearing drew on a series of recent reports published by think tanks, including one covered in a previous FYI, that have called for improving technology transfer at federally funded research universities and institutions.  The legislation requires the federal agencies and departments mandated by the Small Business Act to establish STTR programs to institute merit-based grant competitions aimed at facilitating and accelerating the transfer of federally funded research.  The legislation also requires program evaluation and data collection to assess the effectiveness of proposed methods for technology transfer. 

In his opening statement, Subcommittee Chairman Larry Bucshon (R-IN) noted that “the Bayh-Dole Act, passed in 1980, changed the incentive structure for universities and research institutes to work with commercial entities, including small businesses, to license and patent technologies”  as he emphasized the effects that STTR has had on the creation of new technologies and jobs.  While he was encouraged that “the rate of technology transfer at our nation’s research universities, research institutes and national laboratories has increased” he believes “we can do even better.”  

Ranking Member Dan Lipinski (D-IL) noted that “a big part of our future competitiveness depends on our ability to move new and emerging technologies out of the lab and into the mainstream of commerce.  Accelerating technology transfer from our universities and national labs has been one of my highest priorities since coming to Congress.  I believe the potential for job creation emanating from research being performed at these institutions is immense.”  He recognized that “the path from the lab to a successful business is anything but straightforward” as he emphasized that “it depends on an integrated network of private companies, scientists and engineers, universities, venture capitalists, startups, and entrepreneurs.” 

Members on both sides of the aisle were interested in improving the path to commercialization for technology developed with Federal taxpayer resources.  As Bucshon stated, “more than half of all basic research conducted at our nation’s colleges and universities is funded by the Federal Government.”  Building on that, Lipinski stressed “when technologies have been developed with Federal taxpayer resources, we should explore whether there is a role for the government to play in aiding potential commercialization.”  Lipinski was particularly interested in learning about the use of funds from the STTR program to support the transfer of technology; he also wanted to learn about the reporting obligations, best practices, model programs, and policies that contribute to the transfer of technology.  Members on both sides were interested in discussing the proposed legislation. 


Three witnesses testified.  Brian Wamhoff, Vice President of Research and Development and co-founder of HemoShear, LLC called attention to the high failure rate in clinical trials and the adverse financial effect of these failures on the biotechnology and pharmaceutical industries.  He supported the idea of using a portion of the STTR program for proof-of concept funding and other technology transfer programs at universities, research institutions, and national laboratories.  He noted that “the failure to commercialize academic research is not for the lack of entrepreneurial faculty wanting to do so… rather it is due in part to the lack of institutional support to assist faculty in these endeavors and sometimes, creating unintended barriers of entry.”  Regarding the proposed legislation, he suggested that “establishing ‘hands-on’ oversight committees or boards to monitor accountability of the funded institutions is imperative.” 


Elizabeth Hart-Wells, Assistant Vice President for Research and Associate Director of the Burton D. Morgan Center for Entrepreneurship at Purdue University commented on innovative practices to develop federally funded research projects at Purdue University.  She highlighted the Trask Innovation Fund and the Emerging Innovations Fund as examples of programs to promote innovation taking place at the university.  Of note, was a 40 percent increased licensing rate of the Purdue research funded by the Trask Venture Fund. 


Erik Lium, Assistant Vice Chancellor for Innovation of Technology & Alliances at the University of California, San Francisco focused his testimony on proof-of-concept issues in the life sciences.  He strongly advocated for the dedication of a portion of STTR program funding for proof-of-concept and other technology transfer programs.  Difficulties associated with the valley of death, the phase between early-stage research and the development of a commercialized product, require federal funding.   Regarding the draft legislation, he enthusiastically supported the establishment of the STTR grant programs to support technology transfer of federally funded basic research.  In addition, he advocated for the expansion of the National Science Foundation’s Innovation Corps program “to additional agencies and the addition of phased [proof of concept] funding.”  He also supported “including the requirements for the collection and analysis of data on the performance of funded programs to identify those that may warrant expansion” though he cautioned against including “excessively burdensome and costly administrative requirements.”

Following the testimony, Bucshon asked Hart-Wells to expand on the increased licensing rate of the proof of concept funded projects.  In her response, she described the targeted partnership between businesses communities and university leadership, who share the goal of funding experiments that transfer technology out of the universities into products and services in the commercial sector.  Bucshon then asked Wamhoff about the strengths and weaknesses of the STTR program.  Wamhoff spoke of the critical seed money for proof of concept studies and the role of industry advisors in the process. 

Lipinski was interested in learning about other areas that can assist in the commercialization process for federal research that could be included in the legislation.  Lium described the benefit of the flexibility provided to the agencies while Hart-Wells emphasized the benefit to student entrepreneurship programs and benefit to the universities for the business support services available through the grant program.  Wamhoff then spoke about the advisory role of the private sector that is promoted in this legislation.   

Chris Collins (R-NY) was concerned about the return on investment from the perspective of the taxpayer in addressing the valley of death through the funds from the proposed legislation.  Wamhoff emphasized that any opportunity to reduce the valley of death is a good return on investment.  Collins inquired whether the movement of funds, as proposed in the legislation, would have a positive effect on reducing the valley of death.      

Elizabeth Esty (D-CT) was interested in learning whether the proposed grants would help in the deployment of resources to improve the transfer of technology to market.  In his response, Lium weighed the benefit of conducting proof-of-concept studies at the universities rather than waiting for the technology to reach market.  Esty was also interested in aiding universities in the technology transfer process.  Lium suggested that engaging external boards and mentorship from the commercial community with venture capitalists would benefit universities. 

Throughout the hearing, the witnesses showed support for the ideas in the legislation.  The bi-partisan interest in helping universities with the transfer of technology and the benefit this would have to the industrial community was an on-going theme throughout the hearing.

Aline D. McNaull
Government Relations Division
American Institute of Physics
amcnaull@aip.org
301-209-3094