What potential financial conflicts of interest could arise at universities in the technology transfer process, and what steps have universities taken to deal with them?

  1. Conflicts of time and commitment--an over-involvement of the investigator with the company to the detriment of teaching and university research obligations. Most universities have regulations regarding the faculty member's time obligations to the university. For example, some universities state that the "academic year salary" covers 80% of the faculty member's time during the nine months of the academic year. Faculty are free to consult "up to 20% of the time" (usually understood to be one day per week) during the academic year. Payment for the "summer months" is often under a separate, negotiated arrangement. The issue is further controlled by regular reporting of the investigator's consulting and other outside commitments.
  2. Misuse of university resources on the company's behalf--this includes university facilities, equipment, supplies and involvement of graduate students and other paid researchers. University policies should make it clear that work done at the university must be publishable in the open literature and that any intellectual property such as data, patents and software, developed with university resources belongs to the university. In addition, periodic reports to research sponsors assure that grant money is used for legitimate research ends. Periodic performance review by academic administration and an "appeal path" for employees further controls the process.
  3. Confusion in ownership of intellectual property--The question: "Who owns Professor X's patent?" could become a common source of dispute, unless there are clear university policies and definitions within research agreements of sponsor's rights. University policies commonly state that the university owns all patents and software developed using university facilities or developed under a sponsored research agreement. Industrial sponsors are commonly granted first options to license patens arising from research, and the federal government is granted a nonexclusive license to patents from federally funded research.
  4. There may be a potential or perceived conflict of interest where an inventor holds an equity position in a company, which the university has licensed to market and distribute the invention. Most universities believe that bringing such financial holdings into the sunlight, through public disclosure, is preferable to a hard and fast rule prohibiting the taking of equity together.

Universities also understand the potential unethical conduct may arise from an investigator's financial interest in a company. Universities have separate rules in place to prevent, discovery or sanction fraudulent activities. Scientific misconduct, however, is not to be equated of confused with conflicts of interest.