Partnerships

Module 1. Partnerships
There are many global good practices from institutes in developed countries with a long tradition of university (or research institute)/industry relations which will be meaningful for developing countries. For example, linkages are strongly influenced by the existing national IP policy framework as well as by the patent and licensing policies of individual institutions. An IP policy that encourages technology transfer and commercialization of university research results has proved to be important to establish the right set of incentives for cooperation with industry. There will a number of institutional issues that need to be addressed to make sure that the “cultural gap” can be bridged, including potential conflict of interests, familiarity with the invention disclosure process, financial issues, and other aspects that may condition the success of cooperative R&D and product development.

Global good practices include, for example:

Using research partnerships with companies to help drive innovation, either by directly funding research or by co-locating research centers on or near university campuses or institutes). Currently, core research capabilities of industries are being reduced at the same time as the demand from industry for research that drives more than incremental innovation is increasing. This drives international competition to provide technologies, workforce, and overall research infrastructure. While there may be advantages to forming partnerships in the geographic area where a company maintains its headquarters, there are increased opportunities and incentives to form research partnerships with high-quality universities around the globe.

The partnership models described next are more complex and time consuming solutions to technology commercialization, and may only be considered when an evaluation of resources which need to be committed plus risk versus potential impact or return on investment is judged to be sufficiently substantial.

The principle of the partnership model is that any developing country team which is commercializing a new technology, adapting (sometimes referred to as “translating”) an existing technology for new uses, or developing a solution to a need, will typically lack the capacity to produce a fully marketable product or service. A partner is needed, or perhaps more than one partner, which has the necessary skills which the development team needs. These partners may be located in the team’s country or may be elsewhere in the world. For example, if the product or service is aimed at markets outside the country then the partner may be in a targeted country. In addition to market access, partners may provide services such as product development, product design, and testing to meet standards. Having a partner in a stable developed country may also be a conduit for investment; investors may feel more comfortable knowing their investment, and investment returns, will flow through such a partner. Another advantage of the partnership model is that it can reduce overhead costs and at the same time increase flexibility.

There are several possible variations on the partnership model. For example: the Distributed Partnering Model which has been proposed by the Kauffman Foundation and developed for US needs, but could relevant to developing countries. This model emphasizes the importance of advancing innovative technologies and products rather than building individual companies around new technologies. This model has four independent entities that work collectively to advance innovation, each with its own rational investment risks and rewards.


 * 1) Discovery: A research institute that focuses on new discoveries.
 * 2) Definition: A company that invests in defining the initial product(s) from the research-based discoveries in a given field of expertise.
 * 3) Development: A company with responsibility for funding and advancing product development.
 * 4) Delivery: A company with a significant marketing and distribution channel.

The new feature of this model is that it focuses on these independent groups to collectively contribute to advancing products from research discovery to commercialization.

The Distributed Partnering Model has been proposed by the Ewing Marion Kauffman Foundation Kauffman Foundation for an alternative approach to US drug development needs. @http://www.kauffman.org/uploadedFiles/distributed-partnership-model_12510.pdf

Another variation is to have a single partner entity, inside or outside the developing country, responsible for defining products, identifying market needs (or the possibility of creating a new market), advancing product development, and marketing. Typically, a contract research organization (CRO) carries out these functions for its industrial clients and would be best suited for this role.

Both these variations propose a more efficient use of infrastructure and product development expertise provided by professional service providers (PSP). Potential investors in the product definition company would include angels, large corporations, venture capital funds, foundations, etc., and investor focus would be on their field of interest and the expertise of the operating team. Instead of investing in infrastructure, as was the norm for the venture capital start-up company model, the translational experiments to reach “proof of relevancy” would be contracted to PSPs to perform the key development activities. In this model the PSPs would become a significant force for providing expertise in a given area. Developing country governments can be investors alongside the private sector and take a share of the profits.