What is Technology Transfer?

Publishing your research results online will not guarantee that someone will notice your discovery or invention. Technology needs to be studied and developed, oftentimes in collaboration with partners from different industries, who may help refine either scientific or technological aspects of your work. This can be achieved via Technology Transfer.  But, what exactly is Technology Transfer and why is it important?

This article explores the process of how technology may be transferred from laboratory results into practical uses in industry and in homes.

What is Technology Transfer?

Technology transfer, or Tech Transfer a.k.a. transfer of technology (ToT), is a process in which technology or knowledge developed at one organization is transferred to another, typically for the purpose of commercialization. Technology transfer can be accomplished through a variety of methods including licenses to use protected intellectual property, and may also include exchange of know-how and materials. Commercializing technology requires the ability to identify potential markets, develop products that satisfy those needs, and manage distribution channels.

Technology transfer can be done between universities, businesses, and governments, to share skills, knowledge, technologies, manufacturing methods, and more. This form of knowledge sharing helps ensure that scientific and technological developments are available to a wider range of users who can then help develop it.

The Process Of Technology Transfer

It’s hard to invent a new product. The process of invention translation is complex and long. Here you can find an overview of the process of technology transfer and a short description of each step involved in this process.

  • Research and Discovery – The first step of commercializing a university invention is discovering it in the research labs. Without this, there would be no new ideas or technologies to commercialize. This early stage of the process is facilitated by both faculty members and students at research labs located across different academic disciplines.
  • Invention and Disclosure – If professors, staff, or students realize that a project may have commercial value, they should submit an Invention Disclosure Form (IDF) to the office on their campus responsible for managing inventions, usually named the Office of Technology Transfer (OTT), although some universities have different names for it. This is an important document for declaring your invention internally. It will allow the OTT to initiate the process of technology transfer. The OTT cannot initiate the evaluation process for any inventions until it receives an IDF from the inventor(s). It is important to remember that while this document can be used internally, it does not offer any legal protection to protect intellectual property (IP) outside of the institution.
  • Evaluation by OTT – The OTT staff will evaluate the invention based on information submitted by the researchers. This includes aspects of novelty, patentability, and future commercial viability, commercial value, and other factors to determine whether the university should pursue IP protection and further development.
  • Protection of IP – If the organization decides to invest in the IP and it has been through initial evaluation, they will start working with outside attorneys to file appropriate documents. One of the attorneys’ main responsibilities is to ensure that the proper individuals are named as inventors; this is a significant legal issue, and it’s worth noting that invention and authorship are two separate elements of involvement in a research project. Incorrect designation of inventors could result in invalidation of resulting patents. The next step may be to file a provisional US application in the US Patent and Trademark Office, which may be followed by filing a nonprovisional and/ or Patent Cooperation Treaty (PCT) application within 12 months of the provisional one. The inventor(s) will be consulted throughout all this.
  • Commercialization – After initiating protection of the IP, the OTT staff will create a marketing plan for commercializing the technology. In order to best determine the commercialization path for your research, the organization will work with external corporate collaborators, as well as the inventors themselves, and consider a variety of factors such as the technology’s stage of development or whether it is ready for market. Once this information has been taken into consideration, a decision on which corporate collaborators should be involved in developing and marketing will be done after consulting with the inventor(s).
  • Revenue Management – If the external corporate collaborator generates revenue by commercializing the technology developed at the university, a predetermined percentage of that income should be shared with that university. The specific percentage is determined following negotiations between the OTT and the corporate collaborator. The specifics for how revenue paid to the institution by the corporate partner (typically referred to as royalties) will be distributed within the institution are listed in employee handbooks, on websites detailing institutional policies, or in the “Important Documents” section on the OTT webpage.

The Importance of Technology Transfer

What is Tech Transfer? Video from AUTM

The ability to transfer technology and develop innovative products is a key component of business success. It is through this mechanism that cutting-edge goods can get onto the market, allowing a firm to generate income and prosper. Technology transfer is important to ensure that the company’s innovation becomes commercialized.

This helps early-stage intellectual property to become tools for research. It can also be used as a base for new products and services for public use. In addition, the financial returns afforded by a successful product can be reinvested into further research to begin the cycle again.

The Benefits of Technology Transfer

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Technology transfer has benefits for universities, companies, regional and national economies, and society at large.

For universities, technology transfer may help improve research and the prestige of the institution, its scientists and their innovations. This helps with faculty recruitment and grant funding. It may also provide revenue to support existing or new research activities. For companies, benefits include gaining access to technological advances created in leading research institutes, thus leveraging the investments and expertise performed by world-leading scientists and engineers.

Tech transfer can be good for an economy through innovation, new ventures, and job creation. For society at large, the benefits are incalculable in terms of lives saved, improved health, a cleaner environment, and countless technological advances that bring not only new capabilities but that drive local, regional, national, and global economies forward through innovation. A good example of this is the modern biotechnology industry, which was developed as a result of university technology transfer.

Technology is continuously changing and advancing, and there are countless benefits that have come because of these advancements.

How Technology Transfer Works

The technology transfer process typically starts with technology identification, followed by contractual agreements between parties, such as licenses to use protected IP.

In industrial settings, technology identification is the first step in the technology transfer process, and it can be accomplished through a variety of methods including reverse engineering, researching patents for new inventions, scanning journals for technological advancements, performing company inventories to see what technologies are available within your organization or doing market research to see what kind of products consumers would like you to create. Once identified, these technologies may be included in either license agreements or be transferred from one company to another.

Technology licenses involve providing rights to use within certain territories and time frames but not transferring ownership between parties. In contrast, technology transfers involve exchange of ownership as well along with intellectual property rights.

In university technology transfer, by far the most usual practice involves the issuance of licenses from the university to a commercialization partner, the licensee. Universities are typically prohibited from transferring outright ownership of their IP to outside parties.

Types of Technology Transfer

Technology transfer can be categorized into three basic types:

  1. Technology push. This takes place when a company or university patents its invention and licenses it to other companies. This process is common with university-related inventions because universities are not in charge of manufacturing the inventions themselves, but they want to get their inventions out into the market
  2. Market pull. This is when new technologies are developed in response to demand for a product or service. This is the most common way of technology transfer as it pulls up innovation in order to meet the demands of the market.
  3. Technological spillover. This takes place when new advances in one area stimulate progress in another. It’s called a “spillover” because it’s like ideas spilling from one subject to another, or technology being transferred between countries.

How Tech Transfer Generates Revenue

Technology transfer can help generate revenue by providing financial support for future research.

Technology transfer can help you generate revenue for your business by providing financial support for future research, obtaining an intellectual monopoly on ideas, strategizing cross-marketing opportunities, strengthening ties between organizations through strategic alliances and partnerships as well as licensing patents that have been awarded to your organization in order to create additional income streams outside of traditional products. Technology transfers are typically used when there’s no need for ownership anymore because enough time has passed since its creation where it doesn’t really matter who owns it anymore but still offers the technology to others in order for them to benefit from it.

Technology Transfer at Universities

Universities can also benefit from technology transfer

The Federal Government spends billions of dollars every year on universities to do research. The research helps us learn more about the world and helps us educate people who will be the leaders of science and technology. The discoveries from university research form the basis of many new products and processes that benefit the nation and its citizens. Scientific research is vital for much of the nation’s productivity growth in a knowledge economy.

The Bayh-Dole Act, passed in 1980, has been described as the backbone of America’s research and innovation ecosystem.

Scientific research is often the starting point for new products and processes, but they do not just spring to life. Whether it be a laboratory at a university or an independent lab, these organizations use technology transfer in order to move their findings into the private sector.

Often, the human capital aspect of technology transfer is overlooked. But students and faculty are the best way to translate research discoveries into new technologies. Many university-industry collaborations that have proven to be successful are based on the education or training received by students who have the knowledge and skills necessary to meet industry needs or the relationships that the faculty have established with different businesses.

The Bayh-Dole Act, passed in 1980, has been described as the backbone of America’s research and innovation ecosystem. The law enables academic and non-profit organizations to own patents resulting from discoveries made by their researchers, even if part of the work was funded by the federal government. This was not possible before the Act became law. Employees of the federally-funded institution (the ‘grantee’)must disclose each invention promptly, to their employer. In turn, the institution must disclose any new invention within two months of disclosure to the funding agency.

This is what has to be done:

  • Universities need to decide if they want to retain title over an invention or not
  • Within one year of electing for ownership, universities must file an initial patent application – (provisional, utility or PCT).
  • All patent applications must indicate that the invention was made with federal funding and that the government has certain rights in the invention.
  • A decision not to pursue issuance of a patent must be reported to the funding agency, which may take over prosecution of the patent.
  • Importantly, the grantee must agree that products manufactured by the grantee or an exclusive licensee using the invention must be manufactured substantially in the United States.

Universities must license their innovations to industry and share income with the inventor(s). The federal government retains a nonexclusive, royalty-free irrevocable license to the subject patent. Any remaining funds, after the institution’s technology management overhead costs have been covered, must go towards the support of scientific research or education at the institution such as supporting graduate students, buying research equipment, and funding additional research.

University technology transfer has helped develop new technologies and opened new markets and entire industry sectors. For example, some of the inventions that universities transferred include gene-splicing techniques which form the basis of the biotechnology sector, and include diagnostic tools for breast cancer and osteoporosis, and vaccines. Outside of the life sciences field, licensed university inventions include faster computer modems, new search engines that brought changes to the Internet, and improved building materials with environmentally friendly qualities.

Although there are some notable exceptions, licenses and royalties from the initial findings of university research are seldom high due to most of the technology being preliminary and risky, necessitating considerable time and funds for it to become a functional product or process. Larger fees and higher royalty rates may be commanded if the subject technology has clear potential in commercial applications and will be in high demand. Universities share royalty payments with university inventors and reinvest remaining revenues to support additional research.

Top 5 technology transfer universities

  1. Stanford University
  2. Massachusetts Institute of Technology (MIT)
  3. Harvard University
  4. University of Pennsylvania  
  5. University of Washington

Reuters 2019

Examples of Technology Transfer

Examples of technology transfer can be found across virtually every scientific and industrial area.

Lyrica (Pregabalin)

Lyrica (Pregabalin) box Technology Transfer example
Lyrica (pregabalin) has been called a “wonder drug,” capable of relieving feelings of despair.

Pregabalin, better known by its trade name, Lyrica, is a drug developed to treat  epilepsy and anxiety was found to be a potent treatment for neuropathic pain associated with diabetic peripheral neuropathy, postherpetic neuralgia and spinal cord injury. It was the first drug approved by the FDA for the treatment of fibromyalgia. It has touched and greatly improved the lives of millions since its 2005 debut on the market. It has since revolutionized pain treatment and created a continuous ripple effect that also creates new opportunities for research and collaborations, economic growth, and exciting academic possibilities.

For those suffering from fibromyalgia, a disease with no known cure, pregabalin has been called a “wonder drug,” capable of relieving feelings of despair.

Discovered by Northwestern University chemistry professor Richard Silverman and visiting colleague Ryszard Andruszkiewicz, Pregabalin was first funded by the National Institutes of Health in 1987, when the inventors received a $681,764 grant. Since its 2005 market introduction, Pregabalin has touched millions of people around the world, providing help while also encouraging future research and collaborations, fostering economic growth and creating exciting academic possibilities.

Pregabalin’s popularity has had a major influence on Northwestern, where Pfizer royalties account for about 18% of the University’s endowment. That money has helped to shape new circumstances for students, employees, and faculty alike, extending the impact of pregabalin’s invention in all sorts of directions from chemistry and the humanities to campus life. Overall, the NIH’s $681,764 investment has been a great success.

Memory Foam NASA

Hand on Pressing on Memory Foam Technology Transfer Example
The world has come to realize that there are no bounds to memory foam’s benefits.

Perhaps the most widely recognized NASA spinoff, memory foam was invented by NASA-funded researchers looking for ways to keep test pilots cushioned during flights. During take-off and landing, astronauts are subjected to massive gravitational (or “G”) forces that can cause pain and discomfort. Charles Yost, an aeronautical engineer with North American Aviation, Inc.’s Systems Dynamics Group, was engaged by NASA to assist in the improvement of airline seat designs for crash and vibration protection as well as energy-absorbing techniques for increased survivability. He developed a memory foam product with distinct viscoelastic characteristics, which means it has both high-energy absorption and softness. Ultimately, he invented a material that could adapt to any space-bound body: visco-elastic, a.k.a. “memory” or “temper” foam.

Today, memory foam makes for more comfortable beds, couches and chairs, not to mention better shoes, movie theater seats and even football helmets.

Today, over four decades since its invention, considered a NASA “spinoff” technology, memory foam makes for more comfortable beds, couches and chairs, not to mention better shoes, movie theater seats and even football helmets. Although numerous producers have obtained rights to the technology, the original product maker is still active and pushing temper foam into new applications, such as automobiles, amusement parks, prosthetics, and contemporary art.

Gatorade

Florida Gators helmets Gatorade technology transfer example
Gatorade was created to help athletes by acting as a replacement for body fluids lost during physical exertion

Following a request from Florida Gators football head coach Ray Graves, Gatorade was created to help athletes by acting as a replacement for body fluids lost during physical exertion. Dr. Robert Cade and other University of Florida researchers began investigating dehydration on the sports field, a topic on which no reliable data existed. They came up with a formulation that restored electrolytes. The formulation worked and is credited with helping the Gators improve on the field, hence the name “Gator-aid”, which later became “Gatorade” as we know it.

The invention of Gatorade made an impact on tech transfer at the University of Florida. Part of that impact can be measured in dollars and cents. The University of Florida has benefited from Gatorade’s royalties for more than $250 million, which have allowed the school to support thousands of research projects and often provide seed money for faculty who were able to leverage it into millions in government grants. UF’s tech transfer culture is deeply embedded in the university, where the faculty secured $861 million in research awards in 2021.

Google

Derived from “googol”, Google became the world’s largest search engine

In 1996, two Stanford University students, Larry Page and Sergey Brin, created an internet search engine they called Page Rank. Today we know that invention as Google, one of the largest and most profitable tech companies in the world and one of the most financially successful inventions ever licensed by a university.

They launched their new search engine on the Stanford University website in that year. In six months, Page Rank’s popularity had overloaded Stanford’s bandwidth, shutting down the university’s internet access several times. They shared their invention with Stanford University’s Office of Technology Licensing (OTL), who helped market the technology to prospective business partners. A technology company then approached the OTL about Page Rank and obtained a non-exclusive license for the program for a very attractive royalty payment.

Because the investors were not recognizing the value of their product, Page and Brin founded Google (derived from “googol”, the name for the numeral 1 followed by 100 zeroes) to market and commercialize their search engine. After Google incorporated in September 1998, Stanford licensed the PageRank algorithm to the new startup. In just two years, Google became the world’s largest search engine. Inspired by the same insatiable curiosity of its founders, Google continues to create innovative products that make the world a better place.

More examples

Medical breakthroughs, for example, are often transferred from one technology company to another in order to help spread this technology and make it more accessible to other people around the world who may be able to use it for their purposes or need it for a different reason.

There are thousands of others that have impacted virtually every scientific field and every walk of life: life-saving drugs and medical devices, alternative energy solutions, computer hardware and software, new modes of transportation, blockchain technologies, artificial intelligence, vaccines, robotics, cybersecurity, environmental solutions, agricultural innovations, aerospace, and countless others.

Frequently Asked Questions

Additional Technology Transfer Resources

You will definitely encounter some unfamiliar terms with regards to Tech transfer.  Here are additional resources to check out to get a more ideas about Tech Transfer:

Conclusion

Technology transfer combines research with real world products that can provide benefits for society and solutions to problems. At the same time, it generates income that can be used to fund further research and development. It is beneficial for small to medium enterprises, who can leverage outside expertise, and research.