Purdue takes $100 million that others rejected

INDIANAPOLIS – After more than a year of negotiations, Purdue University has accepted a $100 million gift from a billionaire’s foundation to commercialize basic biomedical research – a sum other schools have rejected amid questions about control of those innovations.\nPurdue President Martin Jischke, who’s scheduled to formally announce the gift Friday at a news conference with billionaire Alfred Mann and Gov. Mitch Daniels, said Thursday the deal with the Mann Foundation for Biomedical Engineering will be a boon for Purdue and the state.\nHe said the endowment agreement creates a nonprofit institute on the West Lafayette campus staffed by product development and industrial experts who will usher promising new biomedical technologies created at Purdue’s labs into the marketplace.\n“It represents for us a new model for technology development and technology transfer and a model frankly that we’re eager to pursue,” Jischke said.\nHe said Purdue’s Office of Technology Transfer, which holds patents on hundreds of technologies that have been successfully exploited in the private sector, simply doesn’t have the product development capability the new institute will specialize in.\nBut the money offered by the California-based foundation created by Mann – a prolific inventor of biomedical devices who Forbes magazine estimates has a net worth of $2.4 billion – has raised questions at other universities it courted.\nLast year, the University of North Carolina at Chapel Hill and North Carolina State University turned down a similar gift following disagreements over the control of intellectual property rights to university inventions.\nAmong those issues was the Mann Foundation’s insistence on deciding which of the schools’ inventions were most ripe for commercialization, something the universities feared would conflict with their other research agreements.\nJischke said he was not aware of the issues that prevented the foundation from reaching a deal with other universities. But he said that after 16 months of negotiations with the Mann Foundation, Purdue officials were satisfied with the deal to create an Alfred Mann Institute at the school.\n“We certainly were able to deal with the issues that were of concern to us and we came to a quite amicable agreement,” Jischke said. “I think it’s a very good arrangement.”\nHe said the agreement recognizes Purdue’s “existing relationships but allows us to continue to conduct contract research with other organizations.”\nWhen the institute’s endowment is fully funded, Jischke said its investment income will yield about $5 million a year to support the institute’s commercialization goals.\nJischke said a 10-member board of directors – half chosen by Purdue and half by the Mann Foundation – will decide what inventions or ideas will be moved along the development process.\nHowever, Bruce E. Seely, an editor with the journal, Comparative Technology Transfer and Society, said a host of complex questions are raised when private groups such as the Mann Foundation offer to finance the costs of moving universities’ research into commercial products.\nOne of those issues is what intellectual property rights a third party will obtain if it helps develop a potentially lucrative product from research financed through a mix of public money and funds from private sponsors.\n“There are ethical questions that surround all of this,” said Seely, the chairman of Michigan Technological University’s social sciences department.\nHe said biotechnology research seems “particularly fraught with questions” because emerging patents with unforeseen applications could prove more lucrative than ever anticipated.\nJischke said space will eventually be built for the institute at Purdue’s Discovery Park research complex, which includes a nanotechnology research center, a biosciences complex and plans for centers devoted to cancer and energy research.\nEventually, the institute could be staffed by about 40 people, most of whom will have product development and industrial design backgrounds.\nThe $100 million endowment is Purdue’s largest to date. It’s more than double the previous biggest endowment, a $45 million gift from 1962 Purdue graduate William Bindley to fund faculty chairs, student scholarships and fellowships, and academic programs.