Page 16-Thursday, September 9, 1982-The Michigan Daily
YOU'RE ONE. YOU'RE IN
GGDD COMPANY

Profs ask 'U' 1o invest
in research corporation

By BARRY WITT
Should the University invest in a cor-
poration that will help professors turn
their research into commercial produc-
ts-a relationship which could bring
substantial sums of money to the finan-
cially strapped institution?
Or-in the belief that the profit
motive would corrupt some of the in-
stitution's intellectual ideals-should
the University avoid such an
organization?
THOSE questions will likely be an-
swered in the coming year, as the
faculty and the administration weigh
the benefits and the drawbacks of
establishing a Michigan Research Cor-
poration (MRC).
First proposed last year, the MRC
would provide both financial and
professional help to faculty members
who have developed ideas that could be
turned into profitable products.
Professors across the country are
discovering that their innovations in
areas such as micro-electronics and
bio-genetics could turn into financial
bonanzas. But proponents of the MRC
believe the great majority of professors
at the University are unaware of their
commercial potential.
"There are a number of ideas floating
around that the University is giving
away," said Walton Hancock, professor
of industrial and operations
engineering and a prime backer of the
MRC.
MANY MEMBERS of the faculty

concur that the University needs to put
a greater effort into encouraging'
faculty members to find ways to profit
from their "intellectual properties."
But agreement on the issue stops
there. Promoters of the MRC concept
believe a structure separate from the
University is necessary to accomplish
these goals. They say that the Univer-
sity's bureaucracy limits its ability to
respond to the needs of the market-
place.
But others say the University should
do the work within existing structures.
THE LEADERSHIP of the College of
Literature, Science, and the Arts said
they "oppose the University becoming
closely enmeshed in (a MRC) on both
academic and financial grounds.
"The University is fundamentally an
intellectual institution, not an en-
treprenurial one, with values and a
modus operandi in many ways an-
tithetical to an entreprenurial ven-
ture," stated the LSA dean and
executive committee in a May memo to
the administration.
They questioned whether the Univer-
sity could afford to finance an MRC in
financially troubled times.
HANCOCK, however, questioned how
the University could afford not to make
the effort. He said that he believes
profits from patents and licenses would
more than make up for any initial in-
vestment.
In his January report on the MRC,
Hancock also mentioned the possibility

of "profits from production operations"
of the company.
The dean of the engineering college
gave his endorsement to the MRC in
June, though he said he would prefer to
see the University use its present ad-
ministrative set up to assist in
developing "intellectual properties
with possible commercial applications.
His recommendation, which he said
he arrived at after consulting with
selected members of the college's
faculty, also said an internal program
should be "accompanied by the
liberalization of present policies abd
stronger incentives to encourage
faculty participation in these ac-
tivities."
FAILING SUCH changes, Duderstadt
said he supported the idea of "an i
dependent corporation... with th
mission of developing, identifying, and
marketing intellectual properties."
Although Hancock stated in January
that the University could provide such
incentives within its present structure,
he cautioned that the University's
bureaucratic tangles would make it far
more difficult to develop these research
projects.
Hancock has stressed that an effort to
increase commercialization of facultj
ideas must have the flexibility to
respond quickly to avenues of develop-
ment.
"THE bureaucracy of the University
does not seem to be such that it can fun-
See 'U,' Page 21

I

Industry filling research gap

WELCOME STUDENTS! Whether you're
brand new to campus or coming back for
more, we want you to know you're in the
good company of 300,000 living alumni
who share the Michigan experience in-
cluding Pulitzer Prize-winning playwright
Arthur Miller, CBS investigative reporter
Mike Wallace, opera singer Jessye Norman
and actress Gilda Radner.
As your Alumni Association, we'd like
you to share our good company as well.
We're not just your Michigan connection
after you leave campus-we're here
throughout your stay. We provide services

to the University such as recruiting top
scholars, providing tours of campus, of-
fering scholarships and teaching awards
and more. We invite you to become in-
volved in our Student Alumni Council
where students become a part of our com-
mitment to the University and to its stu-
dents, past, present and future.
Come see us in the new Alumni Center,
just north of the Michigan League, or give
us a call at 764-0384. We'd like you to be a
part of us. ,
You're one. You're In good
company.,

qI W

By SCOTT STUCKAL
Everhsince thea1950s, University
researchers could always count on the
federal government to sponsor quality
projects. But that time has ended.
While the government has by no
means disassociated itself from the
research business, federal grants and
contracts increasingly are becoming
hard to come by. To fill the gap, the
University-along with many in-
stitutions across the country-is tur-
ning to corporate sponsorship for
research support.
UNIVERSITIES are trying to find
businesses interested in supporting
research in return for the ideas of the
faculty members.
But there is a difference between
government and corporate sponsored
research, officials say.
Usually, government agencies, such
as the National Science Foundation and
the National Institutes of Health, award
a grant to a professor who will follow a
path of research in a broad area in or-
der to expand the frontier of knowledge
of a particular subject.
But corporations usually sponsor
professors to perform specific research

projects in which the company has an
economic interest, according to James
Lesch, director of the University's
Division of Research Development and
Administration. Such contracts are
really "a purchasing of services,"
Lesch said.
THE INCREASE in corporate-orien-
ted research has raised some questions
as to whether the research will con-
tribute to the University's general
benefit.
"Every sponsor has certain
regulationsand procedures to follow
that are set down in the contract,"~
Lesch said, "but in 999 cases out of 1,000
the patent (if there is one) is taken out
in the. name of the inventor by the
University." When a University
research project yields a patentable in-
novation, Lesch said, then the Univer-
sity encourages the researcher to
procure a patent.
"The University's patents are our
own, and we can do what we want with
them. The sponsor of the work would
not get anything," Lesch said.
AN EXCEPTION, he said, is resear-
ch for pharmaceutical firms, which
usually receive a three- to five-year

license on chemical discoveries the6
fund.
When the University does take out a
patent, 20 percent of any profits made
goes to the inventor, 40 percent to the
inventor's department, and 40 percent
to the University.
What is theresto protect the Univer-
sity if a professor wishes to withhold
knowledge of patentable discoveries in
their lab to claim as their own? "There
are a whole variety of conspirac
theories" on how professors can
withhold innovations for their own per-
sonal gain, but not much can be done to
police the problem, Lesch said.
Professors act on the honor system,
he said. At the end of a research
project, the professor is required to
make a statement of any patentable
discoveries he or she may have found,
Lesch said.
In the past, University researchers
have not been concerned with the a
plications and possible financial result
of their work, Lesch said. "Outside of
engineering, the tradition was the
faculty didn't care whether money was
going to be made," he noted. "But there
is a growing realization that they can
make money with their research."


c

*1

RENT

REFR IGER

AL
TOR.

I

0

DIP
,N~ tMP

'"*

for a day
$3000 per academic year*

C~OA JEV/6l6JT CAMIPUS /-CAT/OA(

I
Ii

CONTACT.
ANN ARBOR MUSIC MART
336 S. State - Ann Arbor, 48104
TIoaoan

2

r 1- tT' C
PG P

C' N.
CC
lUAT

I

I

I

)


I u m U uI