Carl Schramm of the Ewing Marion Kauffman Foundation writes that American universities are losing research money to overseas competitors because university technology transfer offices have become “ponderous bureaucracies” that “have frequently contravened contractual agreements to assert ownership over research that a company has sponsored and expects to profit from.”

We, the partners at TreMonti Consulting, LLC, an independent consulting firm specializing in intellectual property management, represent both U.S.-based research institutions and private industry in their technology commercialization efforts. Our university technology transfer colleagues are as professional, competent, and efficient as their counterparts in the private sector. Both have to answer for the deals they make, and with whom they make them.

It is essential to recognize that the work of a technology transfer office takes place in a complex matrix of university business procedures, institutional priorities, and regulatory concerns. Sponsorship agreements are typically managed by a university's sponsored research office, and the terms a university is able to offer corporate sponsors are constrained by the same factors that make universities such an appealing R & D partner in the first place. Typically, corporate sponsorship agreements cannot make an outright assignment of research deliverables to a sponsor. To preserve their eligibility for tax-exempt bonds, for example, universities must comply with IRS revenue procedure 2007-47, which stipulates that industry sponsors must pay a competitive price for the license or use of technology resulting from the project, and the price paid for that use must be determined at the time the license or other resulting technology is available for use (and not at the commencement of the work). Sponsored research agreements routinely grant industry sponsors a first option to negotiate for an exclusive license, and it is at this juncture that the technology transfer office comes into play.

True, companies would prefer not to have to negotiate licensing terms for research they sponsored. Entering into R & D arrangements with universities overseas may be a way to avoid those issues, except that the company is trusting that the host government will continue to lavish attention on the research infrastructure and will honor and enforce the licenses in the long term.

University-generated technology transfer in the U.S. remains the world’s gold standard. For example, according to a 2006 study by the Milken Institute, U.S. campuses have enjoyed great success as fountains of intellectual capital, innovation and advancement. Also, the Milken study found that, with respect to biotechnology, U.S. universities hold eight of the top 10 ranking slots worldwide for production of intellectual property. The key to continuing to unlock this potential is the patient work of professionals who understand both industry and academic concerns and are able to bridge those concerns in fair negotiation. We call on those who offer conjecture on if and why corporate sponsorship of intellectual-property development is going overseas to conduct a study of their own to establish a universal baseline of proof—and not offer simply guesswork or hearsay.