BioPontis Alliance’s business model. Credit: BioPontis Alliance.
I don’t know how generic the situation is (but I suspect it’s similar in materials fields), but a story in Nature Biotechnology—”New models emerge for commercializing university assets,” by Nuala Moran (doi:10.1038/nbt0911-774)—describes some of the dilemmas and responses universities and private industries engaged in biotech development are coming up with to cope with some of the fallout of the limping economy, such as less venture capital funding, less early-stage research funding and all around greater fears about investment risk.
What caught my eye is that Moran profiles an interesting commercialization model being executed by an entity called BioPontis Alliance, based in the Raleigh-Durham (N.C.) Research Triangle Park, which acts as something of a tech transfer accelerant between academia and industry in the field of pharmaceutical research.
BioPontis’ website describes itself as a “hybrid business structure combining asset-based fund investment with industry-experienced asset development.” There are several key components to the model, split between its work with universities and its work with industry:
• On the academic side, BioPontis works simultaneously with several universities, prenegotiating master license agreements. BioPontis obtains nonexclusive rights to examine the school’s IP portfolio and interview relevant faculty and investigators. The schools retain the right to limit what BioPontis can examine. When BioPontis identifies a specific IP asset of interest, a 45-day exclusivity clock starts ticking, when it must make a go/no-go commitment to run with the asset. No immediate payments are made to the university, but at some point before or at the point when it decides to pick up an IP property (the timing is not exactly clear from the story) BioPontis has to stipulate how “mature” it thinks the school’s asset is. This agreed-to level of maturity will determine the university’s ultimate share of the value after BioPontis develops it further and licenses it to an end-user company. BioPontis officials say the cash flow back to it and the school will be determined by the business end of things: It says market demand will determine it’s value.
• On the industry side, BioPontis also prenegotiates agreements with end-use companies. The company has already done so with three big pharma companies. They have the option to acquire assets once they are developed by BioPontis to a “human proof of concept” stage (and here is where the model may not apply directly to nonbiotech materials).
So how do the assets get developed in between the university and end-user licensee? BioPontis uses the inventing scientists as the core for continuing to develop the product. It also uses a network of R&D contract research organizations to develop and validate the technology to the point where it can be marketed to a bigger fish.
Penn State, one of the universities BioPontis has signed up, says it likes the agreement because it can control what the firm initially sees and can limit BioPontis’ term of exclusivity. One school official is quoted by Moran as saying, “We give them early-stage IP, which they work on with access to our professors. They validate the technology under standard terms. It’s a fabulous model.”
Besides Penn State, BioPontis has partnership arrangements with Columbia University, Memorial Sloan Kettering Cancer Center, New York University, University of Florida, University of North Carolina at Chapel Hill, University of Pennsylvania and University of Virginia.
Moran also mentions that similar models are being used in by at least one enterprise in London.