Technology transfer companies open up university research

While publicly funded science is the bedrock on which many successful healthcare companies are built, accessing, translating and successfully commercialising research is often portrayed as serendipitous.

But in the past few years the UK has seen the emergence of a band of specialist companies that are replacing serendipity with well-defined and validated methods.

Crucially, these companies – which include MMI Group, Biofusion, IPSO Ventures, ULive and Imperial Innovations – are listed on London’s Alternative Investment Market (AIM).

This provides them with the funds to help universities capitalise on their intellectual property (IP), while giving investors an unprecedented opportunity to benefit from a broad range of valuable research.

This long-term partnership will make the process for spinning out companies quicker, simpler and better funded than we would have been able to deliver ourselves.

Steve Beaumont

Vice principal

Glasgow University

Rather than risk hand-picking individual enterprises, investors can take a stake in a number of spin-outs by buying shares in these quoted companies.

Equity stakes for specialists

While the precise model varies from one to another, the companies agree long-term – and often exclusive – deals with universities.

In return for providing technology transfer services – including spotting and packaging suitable IP, and setting up, financing and managing spin-outs – the tech commercialisation companies receive significant equity stakes.

In the most recent AIM listing, ULive raised £20 million, which it will devote to commercialising life sciences research from Liverpool University.

Commercialising university IP

The chairman of ULive, Iain Ross, believes the commercialisation of IP emerging from the UK’s universities is set to grow rapidly:

“The key to success will not only be the ability of experienced management to identify those assets which can become a commercial reality, but also to select the most appropriate route to value-creation.”

Meanwhile, one of the earliest of the breed, IP Group, has progressed from listing on AIM to joining the main market in London and now has ten university partnerships.

The most recent, signed with Glasgow University, gives IP Group access to intellectual property generated by 3,400 scientists and a research budget of £100 million per annum.

Accessing first-class research

Glasgow University’s vice principal Steve Beaumont comments, “This long-term partnership will make the process for spinning out companies quicker, simpler and better funded than we would have been able to deliver ourselves.”

Since its formation in 2001, IP Group has created 53 portfolio companies, of which two have been acquired in trade sales and eight have listed.

Two US tech commercialisation companies...have taken advantage of investors’ appetite for the model.

This highlights how the tech commercialisation companies are providing an unprecedented opportunity to access first-class research without the level of risk attached to making individual investments.

UK model admired

There are signs that the model is being admired from afar.

In a survey of the European technology transfer scene carried out in 2005, the European Investment Fund singled out the UK technology commercialisation companies as a model that should be applied elsewhere.

And two US tech commercialisation companies, Amphion Innovations and XL TechGroup, have taken advantage of investors’ appetite for the model by joining AIM.

While XL TechGroup focuses on US research, Amphion is commercialising IP in both the UK and the US.