Entrepreneurship and Industry Relations (E&IR) Working Group Report

Kathi Durdon, Chair; Christopher Neville, Eric Smith, Juntao Luo, Kelsey Moody, Matthew Mroz, Richard Uhlig, Steven Hanes, William Kerr, Eain Murphy, Doug Buerkle

INTRODUCTION:

The Upstate Research Strategic Plan seeks to implement changes to increase Upstate’s intellectual property (IP) portfolio and engagement with companies that drive early innovation to the market. This represents a promising option for funding research outside the traditional federal funding model. The revenue potential both to support faculty research and support growth of research operations and the research portfolio is promising. The E&IR Working Group was tasked with the charge to develop solutions and strategy to achieve proposed goals.

The E&IR Working Group’s first step was to understand current industry engagement. We surveyed faculty and students to: 1) gain an understanding of our current industry relations, 2) understand how best to deepen those relationships and 3) how to form new impactful relationships. Faculty and students who indicated they were working with industry identified engagement in the following ways; speaking engagements, grant partnerships, material transfer agreements, bringing innovation to market, and through consulting arrangements. The identified reasons for not working with industry included: not knowing who the industry contacts were or how to make connections, lack of interest, lack of time, and an environment that was “too punitive.” Also remarked was that Upstate’s restrictive policies were developed due to a culture where industry was considered “unethical.”

There were only a few industry partner survey respondents and they were primarily involved with universities through business development and education. To develop lasting relationships, industry respondents said that universities needed “clean partnership and contract agreements” and a nimble Tech Transfer Office. To that end, industry partners would like to see flexible and reasonable licensing agreements, clear non-disclosure and intellectual property agreements, and upper management support. They also commented that overhead was too high and key inventors were not willing to fully commit to startup generation or relinquish control. One of our working group members had conducted their own industry-level survey previously that presented the following persistent partnership gaps when working with universities:

• Limited/no availability of proof-of-concept funding

• Lack of business expertise and/or access to entrepreneurs

• Poor understanding of holistic customer needs

• Misalignment between universities and industry (objectives, risk tolerance, etc.)

• Limited time and awareness of industrial contacts hindering proactive marketing/business development (Tech Transfer Offices)

• PI interest (conflict of Interest rules)

One barrier mentioned in our survey responses included confusion about Upstate’s Conflict of Interest (COI) process. During this working group process we met with Upstate COI officers who agreed to combine the three existing COI-related policies into one policy and implement a one-stop shop with a single point of contact, combined review committee, decision tree and interactive form. There are, however, several additional barriers to overcome at Upstate, such as the lack of entrepreneurial human capital:

• Limited postdocs who often are the drivers moving technology out of the lab (e.g., must target faculty or graduate students)

• Lack of interest and empowerment (cultural legacy of anti-entrepreneurship)

• Entrepreneurship not included in tenure process

• Current process for entrepreneurship is unclear (e.g., tech transfer)

• Fee-for-service or contract work issues with SUNY Upstate as non-profit tax exempt and need to define sponsored research rates ad hoc

• Lack of start-up funding support

• Limited venues to present ideas and attract investment

This report provides recommendations to sustain an Upstate entrepreneurial culture and advance industry relationships with strategic pathways for involvement and innovation.

UPSTATE ENTREPRENEURSHIP

We define “entrepreneurship” as student or faculty-initiated business activities that aim to commercialize one or more techniques, methodologies, or technologies. The scope of Upstate Entrepreneurship is distinct from other commercialization initiatives in that the focus is on promoting student and faculty-initiated business activities, as compared to sponsored research, out licensing, etc. There are two main categories of activities existing at SUNY Upstate that form the basis of a viable business: 1) Novel Technology: student or facultyinitiated technology that is patentable and, 2) Contract Research Services – technical know-how that can be sold as fee-for-service.

To support and sustain Upstate Entrepreneurship, we must provide incentives for faculty and student involvement and invest in resources to support these endeavors, inclusive of wet laboratory facilities. Effective use of wet lab space within Upstate needs to be strategic based on entrepreneurship goals. Upstate’s incubator, CNYBAC hosts seven wet labs but is currently full with clients seeking expansion space. By utilizing vacant or underutilized laboratory space at the Institute of Human Performance (IHP) and existing faculty laboratories, we can support an Upstate Entrepreneurship footprint as an undeniable value proposition. The university will support faculty and student pathways to involvement and market and align with industry through product development and commercialization, licensing, internships, training, consultancy and funded fellowships for directed research and development.

PATHWAY TO INVOLVEMENT/PATHWAY TO MARKET

Upstate’s intellectual property portfolio is a product of the university’s research portfolio, which is largely comprised of federal research grants. On average, over the last five fiscal years Upstate’s sponsored programs expenditures were $33 million of which $22 million or 64% were from federal sources and $2.5 million were from industry partners.2 From this research activity, the Upstate research community discloses an average of eight new inventions per year, with FY20 setting a five-year record of 12 new technology disclosures. While the numbers may change from year to year, the early stage nature of the inventions disclosed does not. A majority of technologies invented by Upstate faculty fall within the medical diagnostic and therapeutic sector. They are risky, costly to commercialize, and have a lengthy product-launch timeline. We need to de-risk transitioning the results of Upstate’s research portfolio (i.e., innovation) into marketable products and services that transform and save lives. A key barrier limiting the growth of faculty and industry relationships is lack of an organized Pathway to Involvement/Pathway to Market. Fortunately, this is addressable with the following directed action items.

• ACTION ITEM 1. RAISE THE BRAND OF UPSTATE RESEARCH AND INNOVATION TO INTERNALLY IMPROVE A CULTURE OF ENTREPRENEURSHIP, AND EXTERNALLY TO ATTRACT AND ENHANCE INDUSTRY PARTNERSHIPS.

o Enhance externally facing webpage to catalog and showcase unique expertise, equipment, and space.

• Identify and describe in-house startups and licensing opportunities derived from Upstate intellectual property and broadcast sponsored research opportunities exploiting the unique skill sets of current faculty to specific industry targets.

• Include statistics such as: number of patents, number of faculty/postdoc founders, amount of follow-on funding raised for each successful startup, jobs created, etc.

o Leverage all media platforms to tell the story of Upstate research and innovation.

• Create and distribute a slide deck and informational brochure to be sent to faculty, students and industry.

• Establish an advertising campaign highlighting benefits of a Central NY technology hub, to possibly include Rochester, Rensselaer and Binghamton.

• Share success stories, sharing industry partner collaborations via their social media.

• ACTION ITEM 2. INCENTIVIZE INNOVATION AND INDUSTRY ENGAGEMENT.

2 See: Sponsored Programs Administration tab on the RF Systems Dashboard

o Target the needs of Upstate innovators:

• Provide faculty and students the tools and knowledge to understand the intellectual property disclosure process (e.g., mandatory IP 101 for new hires), how to engage with industry, and the support structures (i.e., people, technology, infrastructure) that exist related to industry engagement and innovation.

• Include entrepreneurship goals in tenure.

• Galvanize alumni engagement as a key cornerstone providing mentorship, start-up founding interests, advisory board membership, consultant, investor, etc.

• Allow utilization of faculty labs for entrepreneurial purposes.

• Implement recognition programs for Upstate innovators and entrepreneurs (e.g., most promising inventor, first patent granted).

• Host seed-fund award competitions.

o Target the needs of industry to increase industry sponsored research engagement and enhance translational and applied research opportunities.

• Utilize the CNY Biotech Accelerator to promote business development, commercialization education, match services support, and startup partnership generation.

• Proactively market Upstate’s experimental capacity and ability to function as a CRO as well as other services available to industry.

• Recruit faculty who align with industry pipeline targets, institute faculty positions that are co-shared with industry, and develop industry-supported fellowships.

• Grow investment funding options with the potential for “first right of refusal.”

• Host an industry recruitment day.

• Action Item 3. Expedite transaction time with industry partners

o Communicate and make publicly available the process and procedures for engaging with industry to address “who is doing what by when” to get the engagement finalized.

o Adopt contracting models to accelerate the contracting process for industry sponsored research and intellectual property licensing.

o Produce a flowchart-styled resource page describing the steps needed to establish a successful working relationship with matched industry partners with separate “paths” to navigate the “gradient of involvement” outlined in the UIDP “Partnership Continuum” which includes awareness, involvement, support, sponsorship and strategic partner engagements.

• Action Item 4. Invest in development of service-oriented resources and events.

o Launch Upstate Proof-of-Concept Program to support early stage technology development to de-risk early stage technology, encourage licensing and startup formation incorporating CNY Biotech Accelerator education, mentorship and expansive innovation ecosystem.

o Implement an institutional resource for submission of SBIR/STTR based grants, maintaining a repository of redacted funded examples to educate existing faculty of the requirements for securing funding from these mechanisms.

o Engage Central New York economic business development partner, CenterState CEO (CCEO) in initiatives to attract investment and government support.

o Involve full-time technology transfer support on campus.

o Partner with established university programs such as the SU Whitman School entrepreneurship programs to: involve students in industry collaborations, formalize curriculum to support student transition from trainee to industry track positions, provide resource support of engineering programs to meld with Upstate biomed strengths for ideation and product development.

o Provide funding to support industry-driven projects, not basic research:

• Internal grants of $50,000 to $100,000 to faculty or graduate student

• Employ SUNY TAF and other commercialization programs in the ecosystem (internal to SUNY and beyond, see below)

• Utilize CNYBAC assistance in location of additional funding opportunities.

ASPIRATIONAL GOALS

1. Upstate’s award-winning postdoc program promotes technology transfer out of the university and provides career pathways for our graduates.

2. Best-in-class industry-partnered entrepreneurship programs showcase Upstate’s strengths in discovery, therapeutic advancement and game-changing technology disruption, generating significant outside funding via SBIR/STTR mechanisms, increased patents, licensing and material transfer agreements.

3. Upstate’s CRO services, CORE facilities, education programs and technology transfer fee- for-service operations expand offerings to facilities that lack support services.

4. Upstate invests a percentage of equity back into programming to purchase additional CORE equipment, build additional resources, and expand seed funding opportunities.

5. The CNY Biotech Accelerator expands to include a second facility for startup companies serving as the regional biomedical commercialization hub.