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Executive Summary

INDUSTRY/ACADEMIA BIOTECHNOLOGY RESEARCH ACCOUNTED FOR 23% OF PATENTS applications filed by companies in the biotechnology field in the last five years, according to a survey of 106 biotechnology companies conducted jointly by Harvard and the University of Massachusetts. The report, published in the Jan. 17 issue of Science, states that "university research accounted for 23% of all biotechnology patent applications resulting from the work of involved firms." The report, which breaks down the companies responding to the survey by size, said that university research was responsible for 27% of all biotechnology patent applications filed by non-Fortune 500 companies. In addition, "41% of biotechnology firms involved in university-industry research relationships have derived at least one trade secret from the biotechnology work they support in universities." The biotechnology industry's investment in university R&D totaled nearly $121 mil. during 1984, according to the report. The report concludes that industry spends more on university research in biotechnology than in most other fields, accounting for 16-24% of all funds for biotechnology R&D available to institutions of higher learning in 1984. By comparison, industry supports "only 3 to 4 percent" of all university-based research, and only 3% of such research on health, the report says. Nevertheless, the authors state, "industry funding remains small compared to government support of biotechnology research on the nation's campuses. This suggests that, even in research areas offering the possibility of great, short-term commercial application, government funding remains the cornerstone of academic research. It follows that any substantial reduction in federal support is likely to reduce the total amount of biotechnology research conducted in institutions of higher education. "For example," the authors continue, "if the federal government reduced its funding of biotechnology research by roughly 10% ($60 mil.), and if we assume that one-half of those funds would have gone to universities, as it usually has, industry would have to increase its support by roughly 25% to make up the difference. This seems unlikely, at least in the near future." The authors, led by David Blumenthal, executive director of Harvard's Center for Health Policy and Management, found that almost half (46%) of all biotechnology firms fund research in universities, but that Fortune 500 companies are "significantly . . . more likely" to support these activities than are their smaller counterparts. Of the 35 Fortune 500 companies queried, 29 (83%) said they supported university R&D in biotechnology, compared to 27 (38%) of the non-Fortune 500 firms. Total spending by Fortune 500 businesses on biotechnology research in universities on average was about $1.1 mil. in 1984, the authors estimate, with the average expenditure per project being about $108,000. In contrast, research funds from smaller biotechnology companies averaged approximately $106,000, with an average expenditure of $19,000 per project.

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