Turning Research into Patents

In South Dakota’s heartland, where farmers thresh wheat and soybeans and send hogs and steers to market, Denichiro Otsuga harvests a different kind of crop: ideas.

Research by Assistant Professor Weiping Zhang, left, and Professor David Francis could lead to a new technology to protect pigs against a deadly form of E. coli. Currently, there are no preventative solutions offered by major veterinary biological companies to combat the E. coli bacteria (enterotoxic E. coli) that has been the focus of the scientists.

Otsuga, who has a Ph.D. in devotemental molecular genetics from the University of Utah, was hired July 1, 2008, to set up and direct SDSU’s Technology Transfer Office.

That was the first step in a strategy to create a path to move discoveries out of SDSU’s laboratories, through the patent process, and into the hands of private industry partners who will help develop and market those inventions. The result, ultimately, is that the company, SDSU, and the inventors all benefit from making a new product that can make life better for the customers who want to buy it.

For example?

SDSU discoveries have led to new agreements with various companies to develop:

• Technologies that can protect baby pigs against a deadly form of E. coli;

• An improved means of testing for a respiratory and reproductive illness in pigs;

• A new “nanoparticle” technology that can deliver a variety of drugs to where they are needed in the body; and

• A new device for measuring the efficiency of solar cells.

Clichés notwithstanding, the sky is not the limit for one SDSU technology. Scientists just received funding from the National Aeronautics and Space Administration that uses blue-green algae to make ethanol and other drop-in fuels, but could also make it easier for human colonies in space to clean wastewater and produce oxygen.

The project started with an idea from the SDSU inventors, which was supplemented with proof-of-concept funding from the Technology Transfer Office to show an idea’s feasibility, which lead to a much larger grant award from NASA.

Otsuga concentrated first on setting up a process and making scientists aware of what’s involved in commercializing inventions. He likens his first years on the job to building a road that leads from the lab to the marketplace. Now that the process is in place, he’s placing more emphasis on moving specific projects toward commercialization. In farm-to-market terms, it’s the equivalent of tarping down the loads and getting the trucks on the road.

But not every good idea gets the green light to proceed.

“I think every technology has commercial value. It’s just a matter of where you set your bar or threshold. If I’m investing tens of thousands of dollars to have a technology patented, I have to be very, very selective about which projects will move forward toward the patent process,” Otsuga says. “I don’t think that’s necessarily a bad thing. It forces everyone to be more thoughtful.”

The statistics from Otsuga’s office show what he is talking about: compared to peer institutions around the country that harvest one idea from $3.2 million in research expenditures for every invention disclosure they file, SDSU spends $1.4 million per disclosure.

But SDSU’s Technology Transfer Office is far more selective in what inventions it chooses to patent by selecting 20 percent of the invention disclosures into the patent process thus far. In comparison, peer institutions file patents on about 60 percent of disclosures.

Otsuga created the traffic signal system to move the good ideas toward the market and the first few ideas put on the road have successfully reached the destination efficiently. In some cases, they came back with goods in return, in the form of additional funding from federal agencies and private investment.

After the initial harvest and sending out the product to the market, the profit must be put back in to the system to make it sustainable.

Because it takes a long time and lots of money to obtain a patent and then commercialize the technology (see sidebar), the system needs continuous investment. For the fiscal year ending June 30, 2010, the Technology Transfer Office generated a record $1.2 million in revenue. Half of the revenue is shared with the inventors and the other half is retained by SDSU.

As SDSU expands the Technology Transfer Office operation, it needs to survey the field, Otsuga says.

It is too soon to say which departments at SDSU generate the most valuable intellectual properties. Otsuga says there are key colleges that generate a lot of invention disclosures—among them Agriculture and Biological Sciences, Engineering, and Pharmacy—but the good ideas might come from anywhere. The number of inventions from a particular college or department might fluctuate widely from one year to the next depending on where researchers stand in the research process.

“The bottom line is that a very efficient path and system has been created at SDSU to commercialize SDSU inventions,” Otsuga says. “SDSU now has a challenge to keep this path open and then expand it.”




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