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Business Incubation Through Technology

The technology transfer offices of Alabama’s research universities increasingly use innovations to incubate homegrown startup companies.

The University of Alabama at Birmingham’s Dugald Hall is responsible for making sure good ideas from UAB can find their way to market.

The University of Alabama at Birmingham’s Dugald Hall is responsible for making sure good ideas from UAB can find their way to market.

Gone is the image of the university as an ivory tower, that metaphoric turret where professors and researchers labor in isolation far removed from the harsh realities of daily life.

Academia has been plunged into the world at large. 

But publishing research — the time-honored way of sharing academic discovery — doesn’t guarantee that the discovery will reach consumers or even get noticed. 

Today, innovation is moved into the marketplace thanks to the wonder of the technology transfer pipeline. 

Technology is transferred through a license agreement, which leaves ownership of the intellectual property with the university, while giving the industrial partner conditional rights to use and develop it. Before a technology transfer occurs, inventors define and disclose their invention to the institution’s technology transfer office. 

Breakthroughs made at universities are playing an increasingly important role in economic development and the public good. And it’s happening with gusto at Alabama’s top research campuses.  

At the University of Alabama at Birmingham’s Institute for Innovation and Entrepreneurship, new therapies, vaccines, diagnostics and devices are being unleashed to address unmet medical and environmental needs. 

Intellectual Property Manager Dugald Hall says UAB takes a proactive approach to technology transfer and commercialization through community engagement — working to create an innovative and entrepreneurial ecosystem within the UAB community that fosters commercial development of UAB intellectual property. 

As a result, the Institute provides economic opportunities through licensing products and technologies and forming start-up companies. UAB holds about 223 active license agreements and collects an average of $4 million annually in license income from university-generated research. 

Richard Swatloski, director of the University of Alabama’s Office for Technology Transfer, says part of UA’s research mission is to develop solutions to improve the quality of life and solve major problems that confront society, while expanding the base of available knowledge and technologies. 

“Basic research is vital, but there is a gap between basic research and the application of that research,” Swatloski observes. “Many of the things we do in the Office of Technology Transfer try to narrow that gap.” 

Technology is licensed to other companies for further development and also developed through launching campus startup companies — at present, says Swatloski, UA is home to a dozen or more. The university currently holds about 20 licenses and, over the past eight years, has averaged about $39,000 annually in license income. 

Though technology transfer at the University of Alabama in Huntsville is similar to other universities, they differ in areas of expertise, notes Director Kannan Grant, of UAH’s Office of Technology Development. UAH is more focused on physical sciences, for example, compared to UAB, which focuses more on biotechnology.

“We actively engage with our faculty, staff and students to continuously educate them on intellectual property issues, the process of discovery, protecting discoveries and ultimately having such discoveries find their way into the marketplace,” says Grant. “We do this as part of the process to mine those discoveries.”

Grant says researchers don’t always think of protecting their discoveries or how they can benefit from their discoveries. Innovators disclose their discoveries to UAH’s Office of Technology Commercialization, which conducts a series of evaluations to determine whether patenting the discovery is viable. UAH currently holds about 20 active licenses, with licensing revenue at just over $1 million a year. 

Auburn University’s Office of Technology Transfer supports research by providing a proactive program for the application and commercial development of intellectual property through patents, copyrights and licenses. 

Responsibilities include evaluating invention disclosures, managing the patent process, marketing AU’s intellectual properties and working with start-up companies that license AU technologies. Auburn University currently holds 87 active licenses and licensing income in FY2014 was $863,344.  

Andrew Byrd, the University of South Alabama’s marketing and licensing associate for Intellectual Property Management, says the university’s intellectual property portfolio reflects its core research competencies. 

Launching a new idea in the 21st century can be a “slow and sometimes dysfunctional process,” says Byrd, adding that only about 20 percent of the proposals received each year for patent consideration are presented for consideration, compared to the 50 percent nationwide average. USA has launched six startups in recent years.  

USA holds 16 active licenses, with licensing income just over $2 million a year. In 2008, Forbes ranked USA in the top 15 patent-revenue generating universities in the nation. Lynne Chronister, USA’s vice president of research and economic development, says the university has made it a priority to build a vibrant innovation culture in the region. 

Walter Valdivia, a fellow in the Center for Technology Innovation at Brookings, who focuses on technology transfer and the governance of emerging technologies, says university technology transfer has largely been dominated by a business model of licensing university patents to the highest bidder, which has yielded high income for only a few universities. 

“Technology transfer is useful if it can spur entrepreneurship within its region,” says Valdivia. “A new ‘nurturing startups model’ is being adopted in which universities nurture their own startups and make available their patents to them.”

For this new model to work, Valdivia says the government must expand funding for the Small Business Technology Transfer program, designating funds specifically for university startups. Congress should authorize a patent use exemption for nonprofit research organizations for the purpose of exclusive experimental use. And government must create an equity rule for the distribution of funds among universities. 

“We’re not chasing the last dollar by any means, and the best company is often the small company,” says Director Jan Dowdle Thornton, of Auburn University’s Office of Technology Transfer. “We try to take cutting-edge research to where it can do the most good.” 

UA’s Swatloski notes that technology transfer is about more than just money. “We don’t want licensing royalty to be the determining success factor. It’s important, but it should not be the only driver.”

UAB’s Hall says that historically universities have licensed their patents to the “highest bidder.” With pharmaceutical companies downsizing their R&D groups and federal funding scarce, he says, universities must look for ways to develop their technologies further, rather than simply license them, to increase their value and therefore the return to the institution. 

Licensing technology to a university startup opens up additional avenues of funding, such as Small Business Technology Transfer and Small Business Innovation Research awards, Hall adds. It also provides opportunities to secure investment funding that may not be available if the technology is being developed with the university. 

“If the program is set up appropriately with the right support, we believe this (nurturing startups model) approach can be very successful and one that we are moving toward at UAB.”

New Technologies from the University of Alabama in Huntsville

A very smart pill bottle, real-time storm prediction, algorithms for teaching...

  • Adhere Tech was awarded a second U.S. patent in 2014 for a smart pill bottle. Adhere Tech’s first generation bottle is in use, and a smaller and a less expensive second generation bottle is planned for release this year. The bottle measures whether patients have taken their medication. Data is wirelessly sent from the bottles to Adhere Tech servers to be analyzed in real time. If a dose is missed, patients are reminded via automated phone calls or text messages, as well as by lights and chimes on the bottle. 
  • NextStorm Inc. is a startup that provides weather nowcasting, the accurate prediction of when and where storms will arise over a period of one to two hours. Products being developed use satellite data to discern which cloud will soon produce heavy rain, which will contain lightning and which have the highest potential to become severe storms.
  • GeneCapture began its design phase in 2013 to develop a device to provide physicians with one-hour pathogen capabilities. The product involves DNA probes that “capture” a genetic signature quickly to be used to identify the presence of one of many specific pathogens in a sample.
  • Dawn Research Inc. has patented an electrolytic process now available to the public as a single-component, low-cost and maintenance and environmentally adaptable plating process. The deposit obtained may be at any thickness for single-point diamond turning for optical and other precision applications.
  • Vastly Inc., formerly Complexity Engine, uses a sophisticated algorithm to search websites for content and delivers free, customized and age-appropriate reading materials to a user’s computer. This allows teachers and administrators to set parameters for the search results, and the reading experience can be either student self-directed or guided by the teacher. 

New Technologies from the University of Alabama at Birmingham

Virtual interactive how-to, genetic decoding, cyber security...

  • A UAB startup founded in 2010 has re-imagined how people get help over video. VIPAAR is a virtual interactive presence that enables people in separate locations to provide a virtual demonstration of a task. The technology has applications from surgery to fixing lawn mowers to making sushi.
  • Illumina Inc. is providing access to genetic information through nanopore sequencing, a method for determining the order in which nucleotides occur on a strand of DNA. Biologic nanopore is one component in the development of nanopore sequencing systems licensed in 2013. These systems are useful in personalizing medicine. 
  • IPG Photonics Corp. is providing the technology licensed in 2010 for the production of lasers in the mid-infrared spectrum — useful for plastic processing, laser scalpels, remote sensing and more. 
  • Gambro uses technology licensed in 2012 to provide better dialysis.
  • Soluble Therapeutics Inc. is a startup founded in 2008 around a technology for determining the best conditions for ensuring specific proteins remain soluble in solution. This benefits drug discovery and vaccine development.
  • Malcovery Security is a startup launched in 2013 based on research in cyber forensics conducted at UAB’s Center for Information Assurance and Joint Forensics Research. This licensed technology not only identifies and stops cybercrime activities, but also produces actionable intelligence to enable successful prosecution of cybercriminals. 

Vapor Wake-trained detection dogs are bred, selected and developed to detect the scent trail an explosive leaves in the air. Along with their handlers, they are a formidable tool in the battle against terrorism.
 

New Technologies from Auburn University

Sniffing out explosives, purifying rural water, reining in mad cow disease...

  • Vapor Wake Technology trains canines to detect the scent an explosive leaves in the air.  The “underwear bomber” escaped security detection but wouldn’t get past an Auburn dog. Called a “game changer” by a counter-terrorism official, Vapor Wake canines are used by the Transportation Security Administration, the U.S. Capitol Police, Amtrak and law enforcement agencies nationwide. Vapor Wake was licensed in 2013. 
  • HaloPure BR Water Disinfection brings clean drinking water to countries where people are dying from waterborne diseases. Licensed in 1998, this low-cost system for point-of-use water disinfection is being sold through HaloSource Inc., in India, China and Brazil.
  • CytoViva Ultra Resolution Imaging is a light microscope adaptor that enables researchers to observe living cells in extremely fine detail without the time consuming or invasive steps typical of other high-technology microscopes. Introduced to the market by Aetos Technologies, CytoViva was licensed in 2003 and has won several national awards.
  • Animal Feed Test Kits are helping to prevent the spread of mad cow disease and were licensed in 2009. The kits are used to detect ruminant tissues in meat and bone meals and animal feeds that can spread bovine spongiform encephalopathy or mad cow disease. Kits are sold by Neogen Corp., and a kit for more rigorous testing is available through ELISA Technologies Inc.
  • PGPR is a plant growth-promoting rhizobacteria. PGPR was licensed in 2011, and in 2014 the commercial application to enhance plant development resulted in two license agreements and three option agreements with different companies. 

New Technologies from the University of Alabama

Testing for chronic disease, keeping plants from freezing, capturing carbon emissions...

  • Innovative Med Concepts is a Tuscaloosa-based biotech company that has had a licensing agreement with UA since 2012 and is partnering to create a diagnostic test for fibromyalgia, irritable bowel syndrome and other chronic ailments. The company plans a phase-three clinical trial for a drug combination that has shown promising results in treating debilitating illnesses.
  • BASF is licensing UA patents using iconic liquids to dissolve, regenerate and process cellulose found in the cell walls of trees and other plants. The Licensing Executives Society named the agreement between UA and chemical giant BASF one of its 2006 Deals of Distinction.
  • Frost Protect is a spray-on formula that improves plants’ freeze tolerance up to 9.4 degrees, helping prevent damage and death. Frost Protect was licensed to Oregon-based Gro-Tech in 2008. The spray won Best in Show at the 2009 Independent Garden Center Show in Chicago. 
  • ION Engineering, a leading developer of technology to reduce CO2 emission from industrial and fossil power sources, has teamed with UA to develop a cheaper and more efficient way to clean industrial emissions. UA has been granted two patents for carbon capture research. 
  • Magnn Pro, a UA startup company, is the only company with a patent for a nanowire-based solution to address health and quality concerns with current contrast agents used in MRIs. The technology will significantly improve the imaging efficiency at a much lower dose. The company received a federal grant in 2013 for further development.

New Technologies from the University of South Alabama

Cosmetics to fight skin cancer, early screen for ovarian cancer, mitochondrial repair...

  • Tatva BioSciences is one of six USA-affiliated startups in recent years. These companies are based on USA patents and technologies around which faculty inventors have structured a startup company. Formed in 2014, Tatva BioSciences is a personal care and cosmetics company using silver nanoparticles as a topical cream for ultraviolet radiation protection against skin cancer.
  • ADP Therapeutics is a cancer drug startup company formed in 2015 targeting inhibition of Ras protein family members, which belong to a class of protein that are involved in transmitting signals within cells. 
  • Swift Biotechnology in 2010 licensed a USA Mitchell Cancer Institute technology, which uses a unique set of protein biomarkers to screen and diagnose early stage endometrial and ovarian cancer. 
  • SpectraCyte is a medical device startup company formed in 2014 seeking to improve endoscopic imaging capabilities using an approach that filters light before it reaches the camera over a series of wavelengths. This result is a multi-dimensional image that could allow physicians to better detect cancerous and precancerous cells, and improve the ability to remove those tissues during colonoscopies and other endoscopic procedures. 
  • Millitherm is a medical device startup formed in 2010 that is currently developing technology for non-invasive measurement of blood flow in human skin — a useful indicator of circulatory function. 
  • Exscien Corp. was started in 2010 to develop drugs to repair damage to mitochondrial DNA, thus providing treatment ranging from organ transplant to multi-organ system failure. The company is working on studies in the lung, stroke and cardiac model. 

Jessica Armstrong and Art Meripol are freelance contributors to Business Alabama.  She is based in Auburn and he in Birmingham.

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