The Innovation Ecosystem in Australia is in a state of flux and transition according to the results of the 2015 National Survey of Research Commercialisation (NSRC).
While being mindful that metrics simply tell part of the story when it comes to trends across the research translation landscape, there are some notable points in the data that point to transition or turbulence in the space where public sector research meets industry.
Resources and Inventions
After plummeting from 490 to 306 (38% drop) between 2013 and 2014, the number of staff supporting commercialisation in universities has increased slightly to 333 in 2015. We suspect that this reflects changes in the University sector whereby more effort and resource is being directed towards industry research partnerships rather than commercialisation and that these new, industry focussed roles are not being captured in the NSRC data. Staff levels in the PFRAs and MRIs remained largely unchanged.
Invention disclosures follow exactly the same profile, dropping between 2013/14 before rising in 2015. Invention disclosures are a very short term metric that mirror staffing levels, so it is no surprise – if there is no one to seek out and record the invention, it doesn’t become part of the portfolio.
In contrast to staff and invention numbers, the number of LOAs executed showed the opposite trend, growing significantly (431 to 617) from 2013 to 2014 and then dropping significantly to 480 in 2015. We suspect that LOAs, being an indicator representing typically an 18-month timescale, is reflecting a drop in 2015 resulting from resource cuts in 2014.
University LOA income shows a relatively flat trend, but LOA income tends to develop over a period of 5 or more years and we may anticipate a future drop in LOA income as a result of short term resource cuts. Interestingly, over the 2013/15 period, LOA income for both PFRAs and MRIs have increased significantly (211% and 438% respectively) with PFRAs overtaking the university sector in terms of total income ($89m vs $60m)
Other Industry Engagement
As we have stressed a number of times, whilst important, the relative scale of commercialisation is small relative to all other industry engagement mechanisms. For the whole sector the LOA total was $183m, whereas the total of other engagements was a massive $1.8b. For the University sector the comparison is even more stark, with commercialisation income of $60m and other industry income at $1.2bn, suggesting that commercialisation income represents 5% of the universities’ total revenue, and that the highest value return to the community continues to arise from collaborative partnerships between research and business.
Interestingly, the data mirrors the mindsets of today’s research commercialisation practitioners. The 2016 KCA study exploring the professionalisation of the practice found that 82% of practitioners see the main aim of what they do as being a way to generate relationships with industry and stakeholders. The 2015 NSRC data supports this notion, reflecting a trending a shift in focus from IP commercialisation towards industry engagement, and the realisation that it is collaboration rather than commercialisation, which is the higher value return translation mechanism.
The research sector maintained its commitment to working with industry, as is reflected in the steady growth of researcher training in industry engagement each year. The vast majority of research organisations now offer training to their research staff on how to work with industry, 2015 seeing over 10 000 researchers undertaking some kind of formal training.
The proof of the pudding is in the eating.
UNSW secured $20 million in capital investment from Chinese corporation Hangzhou Cable Co. Ltd. (HCCL). They have established a joint venture with UNSW called Zhejian Handian Graphene Tech, which aims to commercialise the new power cables. This is the flagship collaboration of the new Torch Innovation Precinct at UNSW – an unprecedented partnership with the Chinese government and leading Chinese businesses, expected to deliver more than $100 million to the University over the next 5 years. More here.
Monash University and Woodside have come together to create a globally connected innovation hub that rapidly accelerates advances in Materials Engineering, Additive Manufacturing and Data Science. Woodside will donate $10 million over the next five years in the biggest corporate philanthropic gift in the university’s history. More information here.
Woodside have also partnered with Curtin University to build the Cisco Internet of Everything Innovation Centre to bring together start-ups, industry experts, developers and researchers in an open environment to create ground-breaking and innovative solutions that foster growth, provide jobs and help build sustainable economies. More information here.
La Trobe University and Optus Business have established a strategic alliance designed to deliver an integrated, digitally connected campus; a state-of-the-art Sports Precinct of the Future; and creation of a market leading Cyber Security tertiary degree. More here.
Release of the 2015 data set
The 2015 data set, now available for review via an effective visual comparison tool, and represented by a symbolic infographic depicting some of the 2015 highlights, was released today by the Department of Industry, Innovation and Science.
KCA would like to thank the Department and the research translation community for all their efforts in compiling this information each year since 2000, as we continue to build on a highly useful data set depicting trends across research translation mechanisms.
NSRC is the Department’s commitment to recording and tracking Australia’s progress in converting scientific outcomes, and using this information to inform policy, and in the design, creation, and continuation of, programs to support Australia’s vibrant innovation ecosystem.
KCA Executive Director
KCA welcomes the publication of the National Survey of Research Commercialisation by the Department of Industry, Innovation and Science.
The National Survey of Research Commercialisation (NSRC) has been collecting data relating to the sale of public sector intellectual property since 2000. The data collected for 2014 can be used in conjunction with previous year’s data to paint a picture of some of the outcomes resulting from Australian research engaging with business and government both locally and internationally.
In terms of high level indications from the data, we note that:
- Company creation has fallen significantly
- Commercialisation activity remains stable and
- Industry partnerships have grown significantly
The approach to company creation within universities has changed tangibly over the past few years, with less of a focus now on spin-out creation (where the university would have a licensing and equity interest in the company), and now more of a focus on supporting the surge in student startup activity. These are considerably different activities for universities to be involved with, and are often carried out in different parts of the university. We will work with the Department to explore how all startup activity is appropriately captured in future years.
Given the long lead/lag-time on IP commercialisation, which is often ten years or more, the recent outcomes we see for commercialisation tend to result from activity which occurred quite some time ago. It is also important to note that the influence of Government policy and support programs takes a significantly long time to feed into the system, and current data reflects the end product of programs past.
On the other hand, company creation and research partnerships happen across a much shorter timescale (typically 1 to 3 years) and the data may be suggesting a trend that has been anecdotal until now. That is, the sector has been moving over the past few years, from having a very strong focus on IP commercialisation and spin-out company creation, towards one of research partnerships with industry.
There are two particular data sets that we want to highlight:
Income from commercialisation
Table 5.1.3: Income yielded from active LOAs (AU$ Million)*
Table 5.1.3. shows that the university sector, as a whole, generated AU$61million of income from licences in 2014.
Income from other engagement mechanisms
Table 5.5: Value of contracts, consultancies and collaborations (AU$ Million)*
Whereas when we look at table 5.5, we see that the university sector generated AU$1.3billion of combined income from consultancies, contract research and development and collaborations, which are activities which reflect research organisations working with industry. Interestingly, this figure of income which relates to money earnt from industry for our research and consultancy is two orders of magnitude greater than commercialisation income – and it’s growing at a continuous rate.
The data therefore suggests that engagement mechanisms such as consultancies, contract research and collaborations appear to be much more accurate reflection of activity and engagement between business and research compared to the traditional measure of commercialisation of IP.
But is this a unique feature of the Australian system? The answer is no. Data from the UK analysing HEIF data on university/industry engagement shows the spread of activity across the range of engagement mechanisms:
|Knowledge exchange mechanism||% Revenue|
|CPD and continuing education||20|
|Regeneration and development programmes||5|
|Facilities and equipment services||4|
|Intellectual property (including sale of shares)||2|
TOMAS COATES ULRICHSEN: Knowledge Exchange Performance and the Impact of HEIF in the English Higher Education Sector Report for HEFCE April 2014
This table surprises many, but not those of us in the Technology Transfer community. We know that while IP commercialisation is very important, it is in fact a relatively small activity in terms of overall university revenue from industry. Taking the data from the NSRC and considering our commercialisation income to be the last category and research contracts and consultancies to represent all of the others combined, the Australian data would suggest:
|Knowledge exchange mechanism||% Revenue|
|All other Engagement mechanisms||95.5|
|Intellectual property (including sale of shares)||4.5|
It’s the same order of magnitude and, if we really wanted to, we could argue that we are twice as good as the UK at commercialising IP – but we aren’t going to do that.
What we will say though is that we need a broader view of university/industry engagement beyond a single OECD chart and beyond IP commercialisation income. Let’s recognise that university/industry engagement happens in many ways, most of them bigger and more effective than commercialisation. Let’s recognise them and reward them as these are the ways that our research actually gets translated into the economy to deliver benefits to the tax-payer who funded it.
Dr Kevin Cullen
KCA Vice-Chair, Metrics
CEO, UNSW Innovations
*These tables have been sourced from the data summary report produced by the Department of Industry, Innovation and Science available here.