A seminar offering advice on academic startups for potential CEOs at the University City Science Center — hosted by Bio Strategy Partners, a Montgomeryville, Pennsylvania incubator for emerging and early stage life sciences companies — addressed funding realities and the roles of the university and technology transfer office.
Karen Hanson, the executive director of Bio Strategy partners, discussed some of the findings from the panel discussion which included Kenneth Blank of Temple University, Jennifer Hartt of Ben Franklin Technology Partners of Southeastern Pennsylvania, Teri Willey of Mt. Sinai School of Medicine and Dick Woodward of Vascular Magnetics.
The university is the stakeholder. Sometimes the relationship can be adversarial, but it’s important that everyone involved in the business recognizes their interests are aligned.
When Investment Rhymes with Canada
Canada has a proud history of achievement in the areas of science and technology, and the field of biomanufacturing and life sciences is no exception.
What is the university’s commercialization policy? Increasingly, universities will discourage the principal investigator from being part of the startup, not only because of the potential for conflict of interest, but also, it takes the researcher or faculty member away from doing what they do best. The reality is the university owns the intellectual property of its employees. The inventor is generally not a part of the day-to-day running of the business. Different models are being explored, though, like Penn’s Upstart model.
A good startup CEO is hard to find. The reality of the life sciences sector is that start-ups are formed around ideas for products and technologies that may be several years away from being approved. A company may be formed around the kernel of an idea, so finding the right person is key. He or she is expected to work without pay and has to be willing or able to work for equity.
Funding realities. Investment is so much influenced by what is going on further downstream. Early stage investors have to be assured there will be another exit for them later on. From an investment perspective, there needs to be an understanding of the trends influencing the likelihood of funding. In a decision between whether to fund an oncology medical device startup or one with a health IT product, the critical factor is how easy it will be to exit. When it comes to life science startups, an economic development funder like Ben Franklin Technology Partners’ funding decisions are influenced by many factors, not just the worthiness of the invention.
The role of the technology transfer office. The role of the technology transfer office has broadened in recent years. Traditionally it has been about securing the intellectual property, developing patents, and marketing and licensing the technology. But some are beginning to play a much larger role in the development and commercialization of the idea or product that can include identifying sources of funding and looking at what the market is like for the product. It can also help find sources of funding for translational research.
