Mo. Patent Fight Shows Perils Of Tech Transfer


Research

Now the school considers him a renegade scientist trying to keep the university from getting its fair share of profits from his inventions. Missouri is suing the professor in federal court.

Their deteriorating relationship points to the broader pitfalls of “technology transfer,” the growing enterprise in which university labs help incubate discoveries that can speed lifesaving drugs and modern conveniences to market.

Those innovations can line the pockets of scientists and their university employers with millions in royalties. A prime example is the University of Florida, where the creation of Gatorade nearly four decades ago launched the sports drink industry while earning the school more than $80 million.

But for every Gatorade success story, missteps or disputes like the one in Missouri are more typical.

Often, universities have inflated hopes about the money they can reap from technology transfer, said Joshua Powers, an Indiana State University professor who studies the subject. Powers has found that the top tier of universities such as Yale, Stanford and California-Berkeley account for 60 percent of all technology-driven profits earned on campuses nationwide. Many other schools lose money vying for their share, because applying for patents and trying to license them for commercial use is complex, costly and time-consuming.

“Universities are under enormous pressure to demonstrate their worth in economic terms,” Powers said. “By definition, they are involved at the early stage of the research process. They often dont know when a technology is going to be successful.”

Missouri says it is among those schools profiting from technology transfer. In the most recent fiscal year, the campus spent $1.4 million marketing intellectual property while earning $6.2 million in licensing income.

Making money with beneficial research was the goal of Suppes and his business partner, William “Rusty” Sutterlin, a former Missouri graduate student and postdoctoral fellow. In 2003, they formed a spin-off company, Renewable Alternatives, to develop dozens of inventions related to fuel cell technology, nontoxic diesel fuel additives and an eco-friendly antifreeze.

Suppes, 45, says that the university failed to recognize and pursue the commercial prospects for his research. Yet when he tried to reclaim his rights to those inventions that the university wouldnt pursue, Suppes says, the university obstructed him with onerous rules.

Among those requirements: that Suppes take out $1 million to $2 million in liability insurance. Suppes claims that isnt required of the private companies that sign deals with the university to license technology.

“The Missouri tech transfer program is totally broken and basically beyond repair,” he said.

At least some of Suppes colleagues concur. In the past two years, two faculty committees have recommended changes in how the university commercializes research. One panel pointed to several peer institutions, including Alabama and Texas A&M, that impose fewer restrictions on researchers.

However, Soderstrom acknowledged that Missouris lawsuit against Suppes “is extremely rare.”

A more common occurrence is an aggrieved professor suing his employer over intellectual property.

That was the case when Yale chemical engineering professor John Fenn – the 2002 Nobel Prize winner in chemistry – sued the university for the commercial rights to a new technique for analyzing complex biological molecules. The discovery propelled the development of new drugs and tools for diagnosing cancer.

A federal judge ruled against Fenn in 2005 after concluding he patented the invention on his own and licensed it to a private company founded by a former graduate student. The judge ordered Fenn to pay Yale $545,000 in royalties and penalties and another $500,000 for the universitys legal fees.

In Missouris lawsuit against Suppes, the university says the professor wont release the rights to more than 30 inventions and 11 potential patents it says were developed in his campus labs. The lawsuit doesnt assess the royalty income the school says it has lost.

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