Linda Benedict | 6/2/2009 8:48:10 PM
The LSU AgCenter has the most successful record of commercialization of intellectual property within the LSU System and, in fact, within higher education in Louisiana. Since 2000, nine new companies have been started based on licensing technology from the AgCenter. Royalties from these companies and from other licensing agreements have generated more than $29 million since 1999. This income is distributed among the LSU System, the inventors and the AgCenter, where it is funneled back into more research. The most lucrative of these licensing agreements has been with the international chemical company BASF for a herbicide-resistant line of rice varieties known as Clearfield.
The successful commercialization of intellectual property has come about because of the research culture within the LSU AgCenter. This culture has focused on applied research – research conducted with practical implications for the clientele. Since 1887, when research first began in the Louisiana Agricultural Experiment Station – the research arm of the AgCenter – scientists have aimed their efforts at practical solutions for the problems of growing food and fiber and raising livestock in a subtropical climate. To advance the adoption of new technology, the research culture in the AgCenter also has involved close working relationships with businesses and industry.
Crop variety development has historically been one of the principal research activities of the LSU AgCenter. The LSU AgCenter’s Rice Research Station, which celebrates its 100th birthday this year, was established for the purpose of developing rice varieties that could grow in Louisiana. Clearfield rice is a recent example. Development of a variety of rice that could be grown to withstand the use of a herbicide that would kill the rice-like weed known as "red rice," which plagued southwest Louisiana and much of the rice-growing area in the South, began in the 1980s. Finally in 2002, a high-yielding variety of rice that allowed for the use of this revolutionary technology was released for commercialization. This would not have happened without a collaborative partnership with industry – in this case, BASF. Clearfield rice now accounts for about 60 percent of the rice grown in the southeastern United States.
An example of how crop variety development saved an industry in Louisiana is the sweet potato. This crop can be highly profitable but difficult to grow. By the 1980s, the once-thriving sweet potato industry was dying in the state because of destructive diseases and insects. In 1987, however, the Louisiana Agricultural Experiment Station released a variety resistant to pests, attractive and good-tasting. It was named the Beauregard and has been hailed as the savior of the sweet potato industry in Louisiana. It is still the most widely grown sweet potato in the country.
The Beauregard sweet potato is an example of technology released before there was a coordinated system for such technology to be licensed. Since then, LSU policies have been updated so that the university, individual inventors and the state’s economy can benefit from technology transfer. The licensing of technology to private businesses, which have the resources that universities do not have, makes it possible for these inventions and discoveries to be further developed, manufactured and brought to market. The newer releases of sweet potato, such as Evangeline, are being licensed for production in other states.
Not only are the researchers highly productive, but in 2007, the percent return of royalty income based on direct research expenditures of $62.9 million was 6.86 percent. When all research expenditures, including indirect costs and unrecovered indirect costs associated with research, are considered, the AgCenter’s return on research expenditures was 4.87 percent. When comparing this return (based on figures from the Association of University Technology Managers) with Tulane, which spent $162 million for a return of 4.12 percent; Harvard, which spent $630 million for a return of 1.97 percent; and MIT, which spent $1.2 billion for a return of 5.06 percent, the AgCenter fares very well. Certainly, these statistics change each year, and the returns may not always be as great; however, for the past few years, the returns have been relatively consistent.
The LSU AgCenter is one of the nation’s best examples of how an institution of higher education can serve as a stimulus to economic growth. Our history is one of keeping the agriculture industry in the state alive and thriving. Our record is one of conducting research with practical, immediate application and in collaborative partnerships with business and industry.
Facts about LSU AgCenter intellectual property:
Start-up companies resulting from LSU AgCenter licensing agreements so far are:
University Products (2000). This company, based in Baton Rouge, produces vaccines for the cattle industry.
Reprostat (2001). This Baton Rouge company produces veterinary drugs that can be used to sterilize dogs and cats.
TransGenRx (2003). This biotechnology company produces specialized proteins, including vaccines and growth hormones, and is housed in the Louisiana Emerging Technology Center.
TermiTech (2003). This Baton Rouge-based company licenses pop-up technology developed as an inexpensive, efficient way to monitor termites. The pop-up devices are available at a major national "big-box" store.
OX-B (2003). This company produces cold sterilants used in the dental industry to sterilize dental equipment. The company is in Baton Rouge.
NanoSolutions (2006). This company produces fabric dyes from miniscule amounts of precious metals. This dyeing technique creates lush colors that are permanent and not susceptible to bleaching or fading. The company is in Baton Rouge.
Esperance (2006). This biotechnology company, housed in the Louisiana Emerging Technology Center, produces cancer-treating drugs.
Energenetics (2006). This company produces resistant-starch products with the same cooking quality as regular food starch. The resistant starches have many health benefits such as preventing colon cancer and lowering the risk of heart disease. The technology will also allow for the introduction of recipes containing rice into low-carbohydrate diet programs, increasing the demand for rice and rice products, which will have a beneficial impact on Louisiana’s economy.
D&S Electrostatic Samples (2008). This Baton Rouge-based company has developed air-sampling technology that can screen for disease-causing spores.
Linda Foster Benedict
(This article was published in the spring 2009 issue of Louisiana Agriculture.)