Medical College gets support to expand technology commercialization

Medical College gets support to expand technology commercialization

MILWAUKEE — Five Wisconsin-based businesses and organizations have formed a unique $2.5 million loan pool that will support the efforts of the Medical College of Wisconsin Research Foundation (MCWRF) to expand its technology transfer and commercialization activities. The foundation announced the funding along with the formation of a new Division of Marketing and Licensing, whose primary purpose will be to increase revenue for the Medical College through an aggressive program to commercially license the college’s intellectual property portfolio.
The financing for the new program will be drawn from the newly created MCWRF Technology Development Fund, with the bulk of the dollars committed by Milwaukee-based organizations. The supporters have collectively committed $500,000 annually for the next five years. In addition to the Medical College, the consortium includes Robert W. Baird & Co., the Helen Bader Foundation, Inc., Milwaukee Economic Development Corporation and Madison-based Promega Corporation.
According to Joe Hill, director of the MCWRF, the investment is in the form a $2.5 million fund that will serve as a line of credit with an 8 percent interest rate. Initially the funds will be drawn upon to hire staff and create marketing programs that support the foundation’s efforts to expand visibility for the inventions, discoveries, intellectual property and related technologies developed at the school. “The loans will be repaid based on the success of the program,” Hill said.
“This unique strategy for accelerating technology transfer of intellectual property to products in the market place could serve as a model for other academic institutions,” added Hill.
“Technology transfer organizations are usually self-funded and are often cited as cost centers for colleges said Tim Mathison, vice president of Baird Venture Partners. “We are not aware of other educational institutions that have partnered with local businesses and associations to accelerate technology transfer.”
A little help from their friends
The idea to enhance the foundation’s revenues and resulting creation of the loan consortium has been in the works for almost two years.
“We looked at where we were at in terms of our revenue, staff and licensing activity and compared our foundation to comparable free-standing medical institutions throughout the country,” Hill said. “Based on our research, we estimated that our revenue should be $4 million per year. Then we developed a business plan in which we calculated how much cash would be needed to meet that goal.”
A number of individuals from Baird and the other investors organizations serve on the MCWRF board of directors and were instrumental in looking at reports from the Association of University Technology Managers. They learned first hand of how the Medical College compared with its peers, according to Mathison.
The consortium members represent a diverse group of companies with complimentary backgrounds and experience. “Each of the participants will have representatives on the new division’s advisory board that will assist it with technology assessment and valuation,” Mathison said.
The Medical College has gained a reputation as a leading national research center whose 4,150 faculty and staff direct or collaborate on more than 1,500 research studies annually. The school ranks 44th among all the nations 125 medical schools for National Institute of Health research and training grants for the fiscal year 2002-2003. Last year the college spent $119 million on research with the NIH contributing $78 million in research grants awarded to Medical College.
Due to limited resources and a small staff, the Medical College has not been able to fully leverage the value of intellectual property portfolio. Its yearly licensing revenues have only been about $1 million per year and are not keeping up other medical schools for technology transfer revenues and new company formation. The MCWRF manages a portfolio of U.S. and foreign patents covering 50 core technologies, with patents pending for 45 additional discoveries. The Medical College technologies are currently licensed to 40 companies.
According to Hill, “The launch of the new division will enable MCWRF to more proactively market and license our intellectual property and core discoveries into the commercial marketplace. This effort has the potential to create a major impact on the Medical College as we improve our visibility internationally, increase licensing revenues and continue to attract and retain world class scientists who want their discoveries translated into new pharmaceuticals and medical devices.”
The increase in revenues that are forecasted to come from the new initiative will be used to offset any debt that will be incurred by hiring staff, supporting marketing activities and paying for legal and administrative fees associated with the increase in patent and licensing activities, Hill said.
Ready to go
The MCWRF is not wasting any time in getting stated. A search has already been initiated for a director of licensing who will head the division.
The first priority for the new division will be to commercialize and sell technology licenses to major pharmaceutical, biotechnology, medical device and informatics companies such as GE Health or Pfizer, Hill said. He indicated he has an aggressive schedule of upcoming meeting and presentations with companies in Southeastern Wisconsin and throughout the state.
“The increased licensing activity will have the impact of increasing the research budget at the Medical College as well as the lead to the creation of new start-ups,” Mathison suggested.
In addition to soliciting and negotiating new technology license agreements, the division staffs’ responsibilities will include identifying and assessing Medical College inventions, discoveries and related technologies that may have commercial potential as well as providing general guidance to Medical College researchers and staff on the commercial viability of technologies that might form the basis for new businesses.
Funds will also be used to improve existing “back office” systems and standard operating procedures for identifying, assessing, protecting, marketing and licensing Medical College technologies.
Helping to grow the state’s economy
According to those familiar with technology transfer programs, the MCWRF’s new Division of Marketing and Licensing will play an important role furthering the development of Southeastern Wisconsin’s and the state’s technology related industries which could result in the creation of more high-paying technology jobs.
“The impact of our expanded technology commercialization activities will be seen in the health of our citizens and the economy in the city of Milwaukee, Southeastern Wisconsin and the state,” said T. Michael Bolger, president and CEO of the Medical College of Wisconsin.
Carl Gulbrandsen, managing director of the Wisconsin Alumni Research Foundation commented, “This is a wise investment that is in all of our interests. Joe Hill, the executive director of the MCWRF, will make great use of this opportunity. I believe that there is valuable technology being developed at the Medical College of Wisconsin that will benefit the state economy and so this is the right thing to do.”
“Baird and the other Fund investors are providing growth capital to MCWRF to finance their efforts to build a more significant, self-sustaining commercialization effort,” said Paul E. Purcell, Baird’s president and CEO. “Technologies being developed at the Medical College will help develop Wisconsin’s technology base and will play an important role in improving patient care, ultimately benefiting all of us.”