Author: Marie Powers

Cancer Research Technology (CRT), the commercialization arm of the U.K. research charity, has signed an exclusive agreement with Cephalon, Inc., to develop small molecule inhibitors of the protein kinase C superfamily of cell signaling proteins. The collaboration will advance lead compounds discovered at CRT’s Discovery Laboratories to the selection of preclinical candidates. Protein kinase C plays a pivotal role in cell signaling and the control of processes, including cell growth and division.

Under terms of the agreement, CRT will be entitled to significant up-front and milestone payments as well as royalties on product sales. Cephalon will contribute substantial resources for the work, which will take place at CRT’s Discovery Laboratories in London and Cephalon’s R&D facility in West Chester, PA. The agreement with Cephalon represents a major milestone for CRT’s Discovery Laboratories as the first of its small molecule discovery programs to partner with an international biopharmaceutical company, according to Keith Blundy, chief executive of CRT.

Source:  BioSpace

The University of Mississippi (UM) and the Agricultural Research Service — the principal intramural scientific research agency of the U.S. Department of Agriculture (USDA-ARS) — have licensed the rights for a botanical compound to Irvine, CA-based ChromaDex Corp. The company plans the commercial development of pterostilbene, a compound found in blueberries, grapes, and other small fruits as well as the bark of some trees. In laboratory tests, the compound shows promise for improving cardiovascular health, glucose levels, and cognitive function. “Pterostilbene has the potential to be one of the most significant new ingredients the dietary supplement field has seen in a long time,” says Frank L. Jaksch, Jr., co-founder and CEO of ChromaDex. The company plans to launch the first commercial application of the compound, marketed as pTeroPure pterostilbene, in the coming weeks.

Pterostilbene is chemically related to resveratrol, a compound that is plentiful in the skins of red grapes. Resveratrol is thought to be at least partly responsible for the health benefits attributed to red wine, which include cardiovascular health and cancer prevention. Agnes Rimando, PhD, a research chemist for the Natural Products Utilization Research Unit in the USDA-ARS at UM’s National Center for Natural Products Research, first encountered pterostilbene when she was a graduate student at the University of Chicago. Since 2003, Rimando and colleagues at UM and the USDA-ARS have collaborated on studies of the compound, targeting a particular protein found in cells that is involved in fatty acid metabolism and transport.

Source:  Neutraceuticals World

Writing on the blog Broken Symmetry, Michael F. Martin, senior attorney in the IP practice group at Drinker Biddle & Reath LLP in San Francisco, posts his response to the recent Office of Science and Technology Policy (OSTP) Request for Information (RFI) to work with tech transfer stakeholders, including universities, companies, federal research labs, entrepreneurs, investors, and nonprofits. The most important and difficult obstacle to commercializing university research is the financing gap between curious exploration and venture capital start-ups, Martin maintains. “Because new businesses provide the only sustainable mechanism for the United States to create jobs and wealth, this is also the most important and difficult problem for the United States to solve in its long-term bid to compete in the global economy,” he writes.

To increase the flow of inventions from universities and laboratories into commerce, academics must have more contact with — and more dependence upon — people in commerce, he argues. “Although intellectual property rights can and do facilitate multilateral agreements among universities, researchers, and industry, we must never forget this basic fact of nature,” Martin says. Given that fact, what is the biggest obstacle to increasing communication between universities and industry? In Martin’s view, an obsolete cultural norm impedes these relationships. “This obsolete cultural norm holds that academics must be independent from and disinterested in the consequences of their research,” he writes. “This norm is an ideal, which has never been realized in practice. But even as an ideal it is obsolete.”

Martin encourages the OSTP to bear in mind the extensive negative influence of this cultural norm in evaluating the merits of the various proposals to reform the technology transfer system. “What do all promising practices and successful models of technology transfer have in common?” he asks. “High-bandwidth feedback loops between the university and industry, promoted by fast, easy negotiations with technology transfer offices over intellectual property rights.” The most successful models seem to be subscription-based, nonexclusive licenses of IP, sometimes sweetened for the university with back-ended payments, such as warrants or reach-through royalties, Martin adds. If this model works, why does it not rule at most universities? In Martin’s view, university culture often forces faculty and students to choose between the institution and industry. “With limited administrative resources, inventors avoid the hassle either by ignoring their intellectual property rights or leaving to pursue them without interference by the university,” he writes.

The latter claim might sound incredible, Martin admits, but rough estimates show that universities realize only a fraction of the potential value of their research through IP licensing or spinoffs. Top research universities that employ thousands of researchers who publish thousands of papers file only a few hundred invention disclosures with their TTOs. The same universities spend billions on buildings and equipment, pay only modest salaries, and see only about 2% or 3% come back through licensing revenue. “Comparison against for-profit benchmarks suggests that this percentage could be doubled, tripled, or quadrupled with no additional capital expenditures,” he writes. “Public universities ought to pay attention to these numbers, given the impending credit crisis for many state and local governments.”

Perhaps only the federal government has the authority necessary to bring about large-scale radical changes, Martin suggests. “When universities are easy to deal with, investors will risk money, and entrepreneurs time, to complete the customer discovery work necessary to identify commercial opportunities,” he writes. “There is no one-size-fits-all answer to the question of how research can be commercialized. Rather, commercializing research is an iterative process of asking and answering that question over and over again.”

Source:  Broken Symmetry

The 2009 angel investor market exhibited a modest decrease in investment dollars but little change in the number of investments, while significant changes occurred in the critical seed and start-up stages, according to the 2009 Angel Market Analysis by the Center for Venture Research at the University of New Hampshire (UNH). Total investments in 2009 were $17.6 billion, a decrease of 8.3% over 2008, when investments totaled $19.2 billion. However, 57,225 entrepreneurial ventures received angel funding in 2009, a 3.1% increase from 2008, when 55,480 entrepreneurial ventures received angel funding. Active investors in 2009 totaled 259,480 individuals, compared to 260,500 individuals in 2008. The small decline in total dollars, coupled with the increase in investments, resulted in an 11.1% decline in deal size from 2008, according to Jeffrey Sohl, PhD, MBA, professor and director of the Center for Venture Research in UNH’s Whittemore School of Business and Economics.

At 19%, software accounted for the largest share of angel investments in 2009, followed by health care services/medical devices and equipment (17%), industrial/energy (17%), retail (9%), and biotech (8%). “Industrial and energy investing saw a significant increase from 2008, reflecting a growing appetite for green technologies,” Sohl says. Mergers and acquisitions represented 54% of angel exits in 2009, while bankruptcies accounted for 40% of exits. Annual returns for angel exits (mergers and acquisitions and IPOs) varied from 23% to 38%.

Overall, angels decreased their investments of seed and start-up capital. Thirty-five percent of 2009 angel investments occurred during the seed and start-up stage, a 10% decrease percent from 2008. First sequence investments in 2009 also represented a significant decline from the previous two years, at 47% of angel activity. However, angels exhibited increased interest in post-seed/start-up investing, with 62% of investments in the early and expansion stage — an increase over 2008 commitments. “This decrease in seed/start-up stage and first sequence investing is the unfortunate reality of a difficult economy and little or no support for angels — or the companies they invest in — from the various legislative initiatives enacted to stimulate the economy,” Sohl says. To read the report, “The Angel Investor Market in 2009: Holding Steady but Changes in Seed and Startup Investments,” click here.

Source: News Blaze

2Market Information Inc., publisher or Tech Transfer E-News, has just released the latest targeted edition in its growing series of royalty rate references. Royalty Rates for Technology: Computers and Communications Edition, offers more than 140 pages of benchmarks focused on computer hardware, software, semiconductor, internet, and communications technologies. By deriving all computer and communications entries from the more comprehensive — and more costly — technology edition, we are making these unique data more affordable for those whose interest is focused on these sectors. This new edition is available for immediate download. For more detail, including a complete table of contents, and to order, CLICK HERE.

Writing on his public blog, USPTO director David Kappos explains a streamlined procedure the USPTO has instituted for review of briefs filed in ex parte appeals in patent applications. Under the procedure, the Chief Judge of the Board of Patent Appeals and Interferences (BPAI) will have the sole responsibility for determining whether appeal briefs comply with the formality requirements governing the content of these briefs. The new procedure eliminates two layers of review. Only the Chief Judge and his staff will conduct a compliance review of appeal briefs at the time they are filed. If a brief is determined not to comply with the applicable regulations, the Chief Judge will promptly send the appellant a notice and provide a time period within which an appellant can file a corrected brief. The Chief Judge also will have the sole responsibility for determining whether corrected briefs comply with the applicable regulations and addressing any inquiries and petitions regarding notices of noncompliant briefs. The USPTO expects this procedure to reduce appeal pendency from the filing of a notice of appeal to the docketing of the appeal. To further reduce the number of noncompliant appeal briefs, the Chief Judge has posted on the USPTO website the “Top Eight Reasons Appeal Briefs are Non-Compliant,” which include:

1. Related appeals and interferences – missing or defective: Appellant must provide “a statement identifying by application, appeal or interference number all other prior and pending appeals, interferences, or judicial proceedings known to appellant, the appellant’s legal representative, or assignee which may be related to, directly affect or be directly affected by or having a bearing on the Board’s decision in the pending appeal.”

2. Status of claims – missing or defective: Appellant must provide “a statement of the status of all claims in the proceeding and an identification of those claims that are being appealed.”

3. Status of amendments – missing or incomplete: Appellant must provide “a statement of the status of any amendment filed subsequent to final rejection” in the brief.

4. Summary of claimed subject matter – missing or incomplete: Appellant must provide “a concise explanation of the subject matter defined in each of the independent claims involved in the appeal, which must refer to the specification by page and line number, and to the drawing, if any, by reference characters.”

5. Claims appendix – missing or incomplete: Appellant must provide “an appendix containing a copy of the claims involved in the appeal.”

6. Evidence filed under 37 CFR 41.33(d)(1) and (d)(2) – untimely filed: “An affidavit or other evidence filed after the date of filing an appeal and prior to the date of filing a brief may be admitted if the examiner determines that the affidavit or other evidence overcomes all rejections under appeal and that a showing of good and sufficient reasons why the affidavit or other evidence is necessary and was not earlier presented has been made.”

7. Evidence appendix – missing: In the brief, appellant must provide “an appendix containing copies of any evidence submitted or of any other evidence entered by the examiner and relied on by appellant in the appeal, along with a statement setting forth where in the record that evidence was entered in the record by the examiner.”

8. Related proceedings appendix – missing: Appellant must provide “an appendix containing copies of decisions rendered by a court or the Board in any proceeding identified pursuant to 37 CFR 41.37(c)(1)(ii).”

Additional details about the USPTO procedure are outlined in the Federal Register .

In addition, the USPTO is seeking public comment on a proposed change that would effectively provide a 12‑month extension to the existing 12-month provisional application period. The change would be implemented through the missing parts practice in nonprovisional applications. The proposal would benefit applicants by giving them additional time to determine if patent protection should be sought, enabling IP holders to defer additional fees and enabling applicants to focus efforts on commercialization during the expanded provisional period, according to Kappos. The proposal would add publications to the body of prior art and remove from the USPTO’s workload nonprovisional applications for which applicants decide not to pursue examination.

“The existing 12-month provisional period may provide too little time for inventors to test the marketplace,” Kappos says. “Giving applicants a 12-month period to reply to a missing parts notice would effectively give applicants more time to evaluate the value and market potential of their inventions.” The USPTO published a request for comments on the proposed change in the Federal Register.

Sources:  USPTO Director’s Forum and USPTO Press Releases

The University of Georgia (UGA) Research Foundation has reached an out-of-court settlement in a long legal battle with former UGA researcher Renee Kaswan, DVM. The $20.2 million settlement ends a seven-year dispute over money UGA received from a pharmaceutical company to market Kaswan’s invention, the prescription treatment Restasis, which alleviates chronically dry eyes. The pharmaceutical company Allergan bought the right to develop and market the drug from the research foundation in the 1990s, but Kaswan said in court that UGA lost more than $200 million in fees from the company in 2003 by negotiating a new deal for the drug without her knowledge. The deal gave UGA more money up front, but a lot less in the long run, according to Kaswan.

UGA had little comment on the settlement. “The University of Georgia Research Foundation is pleased that it has reached a settlement agreement with Dr. Renee Kaswan,” UGA lawyer Edward Tolley said in a prepared statement. “We believe the $20.2 million to be fair to both parties, and we wish Dr. Kaswan the best as she continues her academic research.” Under the settlement, Kaswan agrees to release both the drug company and the research foundation from future claims, although Kaswan maintains she’s still in the right. UGA just wore her down, and she wants to move on with her life, she says. “There’s no way they won this case on its merits,” says Kaswan, a former professor in the UGA College of Veterinary Medicine’s small animal medicine department. “They didn’t really win. They just beat me.” The big winner is Allergan, which has racked up more than $1 billion in sales for Restasis, she adds. Source:  http://www.onlineathens.com/stories/040310/uga_600934241.shtml.

A team of cardiologists, materials scientists, and bioengineers has created and tested an implantable device to measure the heart’s electrical output that they say represents the first use of flexible silicon technology for a medical application. “This technology may herald a new generation of active, flexible, implantable devices for applications in many areas of the body,” says Brian Litt, MD, associate professor of neurology in the School of Medicine and associate professor of bioengineering in the School of Engineering and Applied Science at the University of Pennsylvania. Initially, the researchers plan to apply their findings to the design of devices for localizing and treating abnormal heart rhythms. “We believe these new devices will allow doctors to more quickly, safely, and accurately target and destroy abnormal areas of the heart that are responsible for life-threatening cardiac arrhythmias,” Litt says.

The new devices bring electronic circuits right to the tissue, rather than having them located remotely inside a sealed can placed elsewhere in the body, Litt explains. “This enables the devices to process signals right at the tissues, which allows them to have a much higher number of electrodes for sensing or stimulation than is currently possible in medical devices,” he says. The implantable silicon-based devices also have the potential to serve as tools for mapping and treating epileptic seizures as well as providing more precise control over deep brain stimulation and other neurological applications, says Story Landis, PhD, director of the National Institute of Neurological Disorders and Stroke, which provided support for the study.

The team tested the new devices — made of nanoscale, flexible ribbons of silicon embedded with electrodes that form a lattice-like array of connections — on the heart of a porcine animal model. In their experiment, the researchers built a device using 288 contacts and more than 2,000 transistors spaced closely together. Standard clinical systems usually use five to 10 contacts and no active transistors. “We demonstrated high-density maps of electrical activity on the heart recorded from the device, during both natural and paced beats,” says team member David Callans, MD, professor of medicine at U-Penn. The team described its proof-of-principle findings in Science Translational Medicine. “The next big step in this new generation of implantable devices will be to find a way to move the power source onto them,” says John Rogers, PhD, Lee J. Flory founding chair in engineering innovation at the University of Illinois. “We’re still working on a solution to that problem.”

Source: ScienceBlog.com

A renewable energy research project developed at the University of Nevada, Reno is moving from the lab to the field in a demonstration-scale system to turn wastewater sludge into electricity. The patent-pending, low-cost, energy-efficient technology will be assembled in the Truckee Meadows Water Reclamation Facility near Reno and Sparks, NV. “Our plan is to test the unit by about May 15,” says Chuck Coronella, PhD, PE, principal investigator for the research project and associate professor of chemical engineering at U-Nevada. “We’re designing, building, and assembling a continuous-feed system that will ultimately be used to generate electricity. We’ll run experiments throughout the summer, creating a usable dried product from the sludge.”

The experimental carbon-neutral system will process 20 pounds of sludge per hour, drying it at modest temperatures into solid that will be analyzed for its suitability to be used for fuel through gasification and, in a commercial operation, ultimately converted to electricity. The refrigerator-size demonstration unit will help researchers determine the optimum conditions for a commercial-sized operation. “The beauty of this process is that it’s designed to be all on-site, saving trucking costs and disposal fees for the sludge,” explains Victor Vasquez, PhD, associate professor of chemical engineering. “It uses waste heat from the process to drive the electrical generation. It also keeps the sludge out of the landfill.” Estimates, which will be refined through the research, show that a full-scale system could potentially generate 600 kilowatts of electricity a day to help power the reclamation facility plant. U-Nevada’s TTO, with assistance from the College of Business, is supporting the project with plans to make the system available to hundreds of communities around the country that operate water treatment plants.

Source:  PhysOrg.com

For cash-strapped TTOs, industry can be more than a licensee or research sponsor — these companies can be a wellspring of needed resources and funds for you operational budget too — as Mike Rondelli, director of technology transfer and commercialization at San Diego State University, has proven. Rondelli has made it his mission to offset tight money constraints by forging corporate partnerships and utilizing industry funding to further the office’s aims and bolster its budget. Tomorrow, April 8th, you and your staff can find out how SDSU has thrived even in a recession-wracked environment in part by supplementing its funding using corporate dollars and resources. CLICK HERE for details and to register for Stretch Your TTO’s Budget: Tap Into Industry Resources and Partnerships.

PLUS, Coming April 29th: Working Effectively with University Counsel to Speed the Licensing Process. CLICK HERE for complete information.

Tarun Goswami, DSc, associate professor of biomedical and orthopaedics at Wright State University in Dayton, OH, is approaching local manufacturing companies to commercialize his artificial joint research. “We have to create some local interest so this can actually see the market,” says Goswami, who worked with students to develop toe brace and total toe joint replacement technologies for which patent applications have been submitted. Goswami also collaborated with students and with Richard Laughlin, MD, who chairs the department of orthopaedic surgery at Wright State’s Boonshoft School of Medicine, on a total ankle replacement system. The researchers also have submitted a patent application for that technology.

It’s not clear how much revenue the artificial joint technology could generate. However, the decision by Wright State’s Office of Technology Transfer and Development to seek patents is a vote of confidence in the technology’s commercial potential, says Reid Smith, interim director of the OTTD. “This is a growing market, and it’s going to continue to grow as the population ages,” Smith points out. Goswami sees strong potential for collaboration in the Dayton region. “Dayton is famous for materials research,” he says. “The base is here, as well as very strong industry support that we have developing new surgical-grade materials for these kinds of implants.” Promising materials include a polymer known as PEEK and a nickel-titanium alloy. The technology could improve the longevity of artificial joints, Goswami says, which, in turn, could cut health care costs. The technology’s commercialization could mean good jobs for the region, he adds.

Source: Science Business

Researchers at Scotland’s Edinburgh University have outlicensed rights to commercialize self-sustaining treatment for active remediation (STAR), a technology developed to remove toxic chemicals from soil and groundwater. The researchers say the technique will reduce the cost of cleaning areas contaminated with industrial waste by approximately 50% compared to existing methods. STAR safely burns away substances such as oils and petrochemicals in a controlled combustion reaction. The process stops once the contaminants are removed, leaving the original soil or groundwater behind.

The university has entered an exclusive license agreement with U.S. engineering firm Geosyntec Consultants to commercialize the technology. “We see STAR technology as a real game-changer for certain types of sites,” says David Major, environmental scientist at Geosyntec. “We are committed to making this technology available worldwide and especially to establishing a Scottish operation to serve the European marketplace.” Edinburgh Research and Innovation (ERI), the university’s commercialization arm, negotiated the license agreement.

Source:  Science Business

Boise, ID, professional services company Bioscience Bridge, LLC, has been launched to accelerate connections between university-based bioscience research and commercial developers. Michelle Travis and Mark Stinson — former executives of Chicago-based Stinson Brand Innovation, Inc. — formed Bioscience Bridge, which is supported by a team of consultants with backgrounds in product strategy, marketing, business development, life science, legal, licensing, and commercialization. “We know that some of the best bioscience research comes from universities,” says Travis, who serves as principal and managing director. “Bioscience Bridge helps tech transfer offices at these universities get the technology out into the marketplace in the form of a start-up company or licensing agreements.”

University TTOs may contact Bioscience Bridge when they have a technology that is “stuck” or they’re looking for a technology portfolio evaluation, Travis adds. Bioscience Bridge uses several proprietary processes to assist OTTs:

• Evaluation: Using “B.E.A.M.S.” to analyze a university’s technology or portfolio — measuring its breakthrough potential, ease of development, advantages over competitive technologies, marketability, and sampling or prototyping for evaluation.
• Strategy: Facilitating a Strategic GPS navigation process to guide early-stage technologies by identifying key targets, articulating the current situation, defining the desired objective, conveying the over-arching strategy, delineating the milestones, outlining the key tactics, and bridging the science and business in a comfortable atmosphere.
• Promotion: Positioning the right message in the right medium to the right people.
• Negotiation: Assisting with contract terms leading to commercial agreements.

Source: PR Newswire

A charter group of private and public universities that includes New York University, the University of Florida, the University of North Carolina at Chapel Hill, and the University of Pennsylvania has entered into memorandums of understanding with BioPontis Alliance LLC of Raleigh, NC, to advance promising research discoveries. A biomedical development partnership, BioPontis will conduct intermediary technical and patent development work to attract downstream development partners in the biopharmaceutical industry. BioPontis also will work with participating faculty inventors so that all parties can benefit from research and knowledge gains as projects advance toward commercialization. The BioPontis model promotes collaboration on testing and validation as well as on patent enhancements. “The BioPontis Alliance model brings desperately needed financial resources and development expertise to bear at one of the most critical and delicate stages of university-based technology validation and commercialization,” says Michael J. Cleare, PhD, associate vice provost and executive director of the Center for Technology Transfer at U-Penn.

“Universities need a palette of mechanisms to choose from as we work to meet our commitment to achieving public good from our innovative science,” adds David Day, director of U-Florida’s Office of Technology Licensing. “BioPontis Alliance is a model that could be reiterated across many scientific fields and many institutions.” BioPontis is raising a $35 million fund. Co-investment by private investors also is expected “as we deploy capital extremely efficiently across the portfolio, avoiding fixed costs by employing almost exclusively contracted R&D facilities and expertise,” says Barbara Handelin, PhD, president of BioPontis Alliance. “We have figured out how to de-risk this space starting with the right applied science and patenting expertise.” The partnership expects to close the fund in Q3 and immediately begin development on initial assets identified by the university alliance partners.

Source: PharmaLive

The ongoing effort to build a better mousetrap for commercializing university IP has spawned a new concept its developers have dubbed “The Distributed Partnering Model (DPM).” The model was recently described in a white paper available here. Duane Roth, CEO of the San Diego-based nonprofit business accelerator CONNECT, and Pedro Cuatrecasas, MD, adjunct professor of pharmacology and medicine at the University of California, San Diego (UCSD), offer an approach that focuses more on advancing products and technologies than on developing individual start-ups. Although designed for life sciences innovation, the model also can be applied to other technology sectors, according to the authors.

The biggest problem with the conventional startup model is the Valley of Death, “which is where I live” at CONNECT, Roth says. Although research funding has poured into biotechnology since the passage of the Bayh-Dole Act in 1980, driving a growing number of ideas and disclosures, the financing system to commercialize that IP “is just not functioning — especially in the start-up phase,” he maintains. Biotechnologies coming from university research labs now focus on small molecules, not proteins or antibodies. Although the technologies are innovative, they’re increasingly risky. VCs are shunning these early discoveries in favor of downstream technologies with well-identified lead compounds that are likely to succeed in clinical studies — even though this scenario almost never occurs, Roth notes. The DPM “describes a way to think a little differently — perhaps more rationally — about how we fund early-stage innovation,” he says.

The model is built around four independent steps of a collaborative process to advance discoveries by sharing, or “distributing,” the financial and technical R&D risks, based on the unique assets, expertise, culture, and risk tolerance of participating organizations. The four steps are:

1. Discovery. Universities and other research institutions would continue to play a leading role in applying their scientific expertise to generate new discoveries and technologies.

2. Definition. A new type of organization called a product definition company (PDC), which combines an experienced management team with investment capital, would assemble a portfolio of discoveries in a given field, define initial product(s) from the discoveries, and advance them through product definition for eventual sale to third parties.

3. Development. Well-defined products would be handed off to professional service providers (PSP), which would move product development to “proof of relevancy,” when products would be ready to advance to the marketplace.

4. Delivery. Companies, such as big pharmas, would acquire products from the VC owners when they emerge from development, then package and deliver them through their own distribution channels.

Instead of spending capital to build a company, DPM calls for independent PSPs to conduct the translational experiments and move a technology to the development stage. Hence, the majority of investment would fund continued product or technology development rather than operating and maintenance costs. “The difference here is that, instead of starting a company around every idea, you would start a company that takes 10 ideas forward in the given area of expertise of the team managing that product definition,” Roth says.

The white paper was underwritten by the Kansas City, MO-based Ewing Marion Kauffman Foundation, which has raised the hackles of many TTOs. Following Kauffman’s proposal for “free agent” faculty skewered university TTOs, the commercialization debate has continued to rage. And although Roth maintains that the ideas came solely from him and Cuatrecasas, tech transfer professionals have greeted the DPM idea with some skepticism. “Bluntly, I think this is an extremely ill-founded proposal,” says Lita Nelsen, director of the Technology Licensing Office at the Massachusetts Institute of Technology (MIT). Tech transfer is local, Nelsen points out. “The majority of important entrepreneurial deals are done with people we know in the faculty, so the distributed model doesn’t work,” she says. An in-depth article describing and debating the merits of the DPM appears in the March issue of Technology Transfer Tactics. To subscribe and access the full article, plus more than three years of archived back issues filled with tech transfer strategies and best practices, CLICK HERE.

The University of California Davis Health System in Sacramento has received a two-year, $600,000 National Science Foundation (NSF) Partnerships for Innovation grant to develop a Medical Technology Commercialization Clinic that will train students to translate innovative technologies developed in university laboratories into marketable products to advance patient health. The grant will fund a multidisciplinary, collaborative partnership of scientists, educators, and business leaders to stimulate economic development and build a suitable infrastructure to develop medical technology and a diverse workforce. The partnership includes the UC-Davis Center for Biophotonics Science and Technology (CBST) and other UC-Davis departments, Fisk University, Sacramento State University, Los Rios Community College District, Sacramento Area Regional Technology Alliance (SARTA) and its MedStart Initiative, PRIDE Industries, T2 Venture Capital, Wavepoint Ventures, and the cities of Sacramento and West Sacramento.

The Medical Technology Commercialization Clinic will use live and virtual forums to provide hands-on training to graduate and postdoctoral students in biomedical sciences, engineering, and business so they can convert research into treatments and products. The model is designed to overcome challenges to university tech transfer, which traditionally focuses more on discoveries than business development. One example of a project under development at the clinic is an endoscope that combines microscopic imaging and ultraviolet auto fluorescence for noninvasive, real-time detection of cells progressing toward cancer in the esophagus. “The clinic is an excellent way for students and scientists to gain entrepreneurship training and develop strategies to commercialize research projects,” says Gabriela Lee, CBST’s director of partnerships and new program development and manager of the clinic.

Source:  California Healthline

A federal judge has struck down patents held by Salt Lake City-based Myriad Genetics and the University of Utah Research Foundation on two genes linked to breast and ovarian cancer. The decision, if upheld, could throw into doubt patents covering thousands of human genes and reshape IP law. U.S. District Court Judge Robert W. Sweet issued the 152-page decision, which invalidated seven patents related to the genes BRCA1 and BRCA2, whose mutations have been associated with cancer. The American Civil Liberties Union and the Public Patent Foundation at the Benjamin N. Cardozo School of Law at Yeshiva University in New York joined with patients and medical organizations to challenge the patents last May.

The plaintiffs argued that genes — as products of nature — fall outside of the realm of patentable materials. The patents, they argued, stifle research and innovation and limit testing options. Myriad asked the court to dismiss the case, claiming that the work of isolating the DNA from the body transforms it and makes it patentable. Such patents, the company argued, have been granted for decades. In fact, many in the patent field had predicted the courts would throw out the suit. Instead, Sweet ruled that the patents were “improperly granted” because they involved a “law of nature.” He said that critics of gene patents considered the idea that isolating a gene makes it patentable “a ‘lawyer’s trick’ that circumvents the prohibition on the direct patenting of the DNA in our bodies but which, in practice, reaches the same result.”

The ruling came in a long-running fight between scientists who believe that genes should not be exploited for commercial gain and companies that allege a patent is a reward for years of expensive research that moves science forward. The lawsuit contended that Myriad’s refusal to license the patents broadly has prevented women who fear they may be at risk of breast or ovarian cancers from seeking other sources of information about the genes in question. The decision is almost certain to be appealed to the 2nd U.S. Circuit Court of Appeals in Manhattan.

The final decision in the case will have far-reaching implications. About 20% of human genes have been patented, and multibillion-dollar industries have been built around the IP rights granted. “If a decision like this were upheld, it would have a pretty significant impact on the future of medicine,” says Kenneth Chahine, a visiting law professor at the University of Utah who filed an amicus brief on the side of Myriad. Medicine is becoming more personalized, with genetic tests used not only to diagnose diseases but also to determine which medicine is best for which patient, he points out. Chahine, who once ran a biotechnology company, also warns the decision could make it harder for young companies to raise money from investors. “The industry is going to have to get more creative about how to retain exclusivity and attract capital in the face of potentially weaker patent protection,” he says.

However, “the evidence has mounted that human gene patents are doing more harm than good,” and resulted more by accident than comprehensive policy, argues Jesse Reynolds, a policy analyst at the Center for Genetics and Society in Berkeley, CA. The Myriad patent “was particularly troublesome” because it was so broadly worded, Reynolds says. Reading the court ruling, “I saw nothing that limited it to Myriad’s patents,” he adds. Instead, the decision boiled down to a finding that “natural things aren’t patentable — inventions are,” Reynolds says.

Edward Reines, a patent attorney in the Silicon Valley office of Weil, Gotshal & Manges, notes that the loss of patent protection could diminish the incentives for genetic research. “The genetic tools to solve the major health problems of our time have not been found yet,” Reines says. “These are the discoveries we want to motivate by providing incentives to all the researchers out there.” Bryan Roberts, a Silicon Valley VC, says the decision could push more work aimed at discovering genes and diagnostic tests to universities. “The government is going to become the funder for content discovery because it’s going to be very hard to justify it outside of academia,” he says.

Sources:  The New York Times and The Washington Post

In light of the U.S. District Court ruling that invalidated patents related to the BRCA1 and BRCA2 genes that are held by Myriad Genetics (see previous item), the findings of a Duke University study estimating the reach of one of the claims involved are all the more instructive. The reseachers analyzed U.S. Patent No. 5,747,282 and compared a 15-mer oligonucleotide in the BRCA1 gene described by one of the patent’s claims against gene sequences in GenBank, the NIH genetic sequence database. They found that 80% of cDNA and mRNA in the database contain at least one oligonucleotide covered by the claim. Additionally, some 300,000 oligonucleotides in chromosome 1, which does not contain the BRCA1 gene, would be covered by the claim, according to the researchers, who conclude that “any ‘isolated’ DNA molecules that include such 15bp nucleotide sequences would fall under the claim as granted by the U.S. Patent and Trademark Office (USPTO). Anyone making, using, selling, or importing such a molecule for any purpose within the United States would thus be infringing the claim.”

Based on the timing of Myriad’s application for patent ‘282 and a patent application by the NIH that had previously been rejected due to the claimed 15-mer oligonucleotide being identified in existing DNA sequences, the researchers conclude that the USPTO may have erred in granting Myriad this far-reaching claim. The paper by Thomas Kepler, PhD, division chief of computational biology in Duke’s department of bioinformatics and biostatistics, attorney Colin Crossman, and Robert Cook-Deegan, MD, director of the Center for Genome Ethics, Law & Policy at the Duke Institute for Genome Sciences and Policy, was published in Genomics.

When the researchers examined the claims of the ‘282 patent, they found that one claim “seemed to us particularly broad, so we investigated it, doing simple calculations to estimate its reach, and testing our findings by direct analysis of the extent of its reach within parts of the human genome.” They concluded that certain claims, particularly claim 5, were so broad that the ‘282 patent could be enforced to cover portions of most genes in the human genome and likely most genes in nature. Claim 5 covers “an isolated DNA having at least 15 nucleotides” in the BRCA1 polypeptide — language that is essentially “a claim on any 15-mer oligonucleotide found in any such sequence,” Kepler and colleagues point out.

The USPTO granted Myriad and the University of Utah the ‘282 patent in 1998, but Myriad filed its patent application in 1995. A survey of GenBank performed by the Duke researchers showed that 568 of 713 mRNA coding sequences deposited in GenBank in 1994 contain at least one BRCA1-derived 15-mer oligonucleotide. “These findings suggest that there were already many sequences in GenBank covered by claim 5 at the time the patent application was filed,” the authors point out. “This further suggests that the claim should not have been granted, based on section 102 of the Patent Act (novelty).” In fact, a patent application by the NIH filed four years before Myriad’s ‘282 patent was rejected precisely because the patent claimed 15-mer oligonucleotides found to exist in other DNA sequences, according to the researchers.

“[We] believe the astounding breadth of the claim coupled with the fact that the DNA was already well known to researchers leaves this claim of the patent vulnerable to a court challenge,” the researchers said in a statement. Indeed, the Duke team determined that not only can Myriad’s claim be “significantly narrowed,” but that many genetic patents are similarly broad. As full-genome sequencing becomes more widespread, any kind of genomic sequencing will likely infringe such broad patents, the researchers conclude.

Source: GenomeWeb

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Writing on his blog The Next Big Thing, Google developer advocate Don Dodge explains some factors that drive angel investors. Angels love to help start companies, solve tough problems, build a great team, and be actively involved in finding customers, partners, and key employees, he says. They tend to invest in companies that are within a one-hour drive so they can be actively involved and leverage their network of friends and business associates. If they can’t be actively involved in a company, they probably will not invest.

Angels tend to invest like VCs except with smaller amounts — $200K to $2M — and typically complete 15 times as many deals, Dodge adds. The average angel group makes eight investments per year, totaling about $2M, with an average deal size (seed stage) of about $250K. “Angels are compassionate and have a soft spot for budding entrepreneurs, but they are not stupid,” Dodge writes. “They invest in what they know, where they can apply their experience, and in deals where their money can have impact.”

Because they invest at the seed stage, some angels use convertible notes to fund companies. Rather than haggle about valuation, angels will sometimes invest early and agree to convert their note at the price set by Series A investors. “The theory is that, at Series A, more will be known about the business, market, competition, and technology, and it will be easier for the founders and investors to agree on a valuation,” Dodge explains. In addition, convertible notes usually have simple terms and fixed interest rates, and may include warrants to purchase additional shares. Convertible notes can be assembled quickly by a lawyer for a small fee, while Series A docs are complicated, expensive, and time consuming. “If you are only raising $100K of seed money it doesn’t make sense to spend $25K to $50K on lawyer’s fees for Series A docs,” Dodge points out.

When everything goes according to plan, convertible notes are fine, but there are risks for angels. “The problems come when it takes much longer to raise the Series A, or you never raise a Series A,” Dodge says. For example, if an angel invests with the expectation that there will be a Series A within four to six months at a valuation somewhere around $2M, what happens if a year or more passes, the company excels, and the valuation goes to $6M without an A-round? The angel took all the risk, helped build the company, and waited a year or more yet gets none of the benefit of helping to build the company valuation, he points out. If the company is acquired for $10M or more before a Series A, the angel loses that value creation. In fact, the company may never raise a Series A if it fails, becomes cash flow positive and doesn’t need to raise money, or is acquired.

Having specific conversion values for each of these scenarios can solve these problems, Dodge says. For example, the note could stipulate, “If Series A is raised within six months, the notes convert at the same price as Series A investors. If Series A takes longer than six months, the notes convert at a valuation of $2M, regardless of the Series A valuation. If acquisition occurs within six months and prior to Series A, the notes convert at the lesser of $4M or the acquisition valuation.” The goal is to allow angel investors to participate in upside value creation in exchange for taking early risk and helping to build the company.

Source: The Next Big Thing