U of M Sees Major Drop in Invention Royalties

Among universities that earned more than $2 million in royalties in 2009, the University of Minnesota reportedly saw the biggest drop during the subsequent two years.

The University of Minnesota’s revenue from invention royalties has reportedly dropped faster over the past two years than that at most other U.S. research institutions.
According to a recent USA Today report, the U of M’s revenue from the licensing of inventions that its researchers developed plummeted by $75 million between 2009 and 2011—to total $10 million last year. Among the nation’s institutions that earned more than $2 million in royalties in 2009, the university saw the biggest drop in revenue over the time period, the newspaper reported.
The drop was reportedly due largely to declining royalties from an anti-AIDS drug patent, which has expired in some countries and is set to expire in the United States in 2013. The drug, known as Ziagen, was developed by a U of M researcher in the 1980s and has generated more than $290 million in royalties for the university since 1999, the Star Tribune reported last year.
Nationally, licensing income earned by research universities has increased about 4 percent each year since 2009, according to USA Today. And Northwestern University in Illinois reportedly led all universities with $191 million in licensing income in 2011. But many universities reportedly struggle to maintain revenue from their inventions because intellectual property laws allow these institutions to charge royalties for only a few years.
“Royalty income really depends on the hot drugs, hot products or hot technologies, and where they are in the market and patent cycle,” Richard Bendis, CEO of Philadelphia-based nonprofit Innovation America, told USA Today.
Like many universities, the U of M has reportedly stepped up its emphasis on technology commercialization in recent years by increasingly seeking partnerships with companies and venture-capital firms. In September, the university announced that discoveries by its researchers launched a record 12 start-ups in fiscal 2012, which ended June 30. The previous record was set last year, when nine companies were launched.
To read the full USA Today story, click here.