Russ: This is The BusinessMakers Show, heard on the radio, seen online at TheBusinessMakers.com. Coming to you today from the Wolff Center for Entrepreneurship at the Bauer School of Business at the University of Houston and my guest is Dr. Mark Clarke. Mark, welcome to The Business Maker Show.
Mark: Great to be here, Russ.
Russ: You bet, so you got on our radar because your mission here is to commercialize the intellectual property that has been created here at the university, correct?
Russ: OK, now before we go down that path, and for my audience, I don't normally do this but I'm going to read his background. He has a master's in pharmacology and a PhD in cell biology and biochemistry from Manchester Metropolitan University. Is that in Ireland?
Mark: Actually in mainland Britain, but I grew up in Ireland.
Russ: Mainland Britain, grew up in Ireland. Did post-doctorate training in the department of cell biology and anatomy at Harvard Medical School, then joined the life sciences directorate at NASA Johnson Space Center, as a National Research Council Fellow in the muscle research laboratory, has taught graduate level classes here at the University of Houston in the philosophy of science, exercise physiology, and advanced muscle physiology as well as being a founder, member and current director of the laboratory for integrated physiology. He developed a multidisciplinary master's of science degree in human space exploration science and as I already pointed out, today heads up the University of Houston's sty of intellectual proportion commercialization amongst several other things. Do you sleep at night?
Mark: Yes [laughter].
Russ: My goodness, what an impressive background and I think there are future interviews perhaps in some of those other categories, but tell us, how did you land in this position of championing the cause of commercializing the intellectual property here at the University of Houston?
Mark: Really it's my own interest and passion in innovation and invention, in that I hold 12 US patents and several others that are in the pipeline. As a faculty member, I know what it's like to deal with the university technology transfer office, sometimes that's a great experience, sometimes not. My interest in innovation and entrepreneurship is – I had that interest most of my professional career. I've had two startup companies of my own, one of them failed, one of them is still looking for series A funding in orthobiologics in the bone area. Our leadership here, the president, President Renu Khator, and my boss who's the VP for research and technology transfer identified my as somebody that could help our faculty sort-of navigate through that process and help create a culture of innovation and entrepreneurship here at U of H.
Russ: I have the perspective that the University of Houston has a significant volume of intellectual property compared, probably, to other universities and sort-of based on this getting focused more today, was never real aggressive at commercializing it, would that be accurate?
Mark: I think that's a fair statement. I would say since our strategic 2020 goals that incorporate this concept of helping to create and support a culture of innovation and entrepreneurship on campus came into play I would say in the last couple of years and it began when we hired Roth Bose as the VP for research and technology transfer, he has a background in this and has done – created ecosystems, entrepreneurial ecosystems at other universities. I would say the university had done a good job of protecting its IP.
Russ: Which is important.
Mark: Which is important, but we hadn't done a really good job on the technology transfer and commercialization side in that we really didn't have an infrastructure and I would also say not necessarily the attitude needed to bring products to market from the basic research aspect of the house. So that's – has become my job, which is to try and generate pathways where both our students and our faculty can be successful in creating spinoff companies and taking their technologies to market.
Russ: Give me an overview of the IP portfolio here.
Mark: Presently, the University of Houston has approximately 170 issued US patents and associated foreign patents and over 220 pending patents that have been filed with the USPTO, and that covers the whole waterfront of technologies, everything from advanced materials, renewable energy, health care and biotech, pharmaceuticals, software, and optics in that that's one area that is a growing area of technology here at the university in that we do have a school of optometry and our faculty in that school are very innovative when it comes to a variety of technologies associated with eyes and health care.
Mark: And very recently we won the first worldwide nano-medicine technology awarded, in Vienna, at a conference with a technology that was spun out of the University of Houston. That company is Endomagnetics and they have a product in the European market, clinical product called a centimag system. That's a technology which allows you to assess lymph node involvement specifically in breast cancer using a particle tracer molecule based on some high temperature superconducting particles. Another success story recently was the recent winning of the Garate award here in Houston by another one of our spinoff companies, C Voltaics, for a technology – coding technology that is based on a nano-particle system that is highly hydrophobic and shuns water, in fact it's name is the shun, is the product itself.
Russ: Really cool. Now, as you know, The Business Makers champions entrepreneurship, we are sort-of pure capitalist, free enterprise people, but always when I've heard that term technology transfer from universities it's always sort-of been, well, wait a minute? What does that mean and does that mean they just have this intellectual property that they like to sell that people run out, does it mean that they partner with others that can do it, does it mean that they just develop it on their own or does it mean all of the above?
Mark: I would say in most universities it's the latter, which is that – I should say the former, which is the standard out licensing model, where the university sees a partnership where they essentially just license the technology and take no real active role in helping to push that technology forward. At the University of Houston we've embraced all of the above in that we have a standard out licensing model and have over 25 active licenses that bear license revenue for the university. We also have a strong program where we partner with commercial partners, our industry partners, where the actual basic research is part and parcel of the relationship with the entity. So for example, we have an industrial partnership with a high temperature superconductor wire manufacturer where we have a manufacturing facility in our energy research park. That's a true partnership with a commercial entity and we have several other examples of that, some of them more mature than others. The third leg of the stool is to actually utilize the intellectual capital and the expertise that we have internally to the U of H. Today, we're coming from the Wolff Center for Entrepreneurship in the Bauer School of Business. This is a program that trains the next generation of entrepreneurs. We've had a very successful relationship with the faculty in the program here in that we believe that if by pairing these young entrepreneurs with our faculty inventors who are not necessarily entrepreneurs, then that allows both of them to generate an opportunity to bring their technology to market.
Russ: Well, I mentioned already that that's how you got on my radar that it was really through the Wolff Center. The Wolff Center is excited about partnering with you as I'm sure the students that are part of the Wolff Center are. Man there's some fascinating technologies that are happening in that partnership today, maybe share a few of those with us.
Mark: This particular cohort of technologies, there are eight separate technologies that are all patent protected and they range from real time MRI guided robotic surgery technology to a water filter system for use in the third world based on a nano-membrane system, all the way to a image analysis system that was originally developed to go on a smartphone to help with screening for melanoma.
Russ: Impressive I might say. I've always thought that it really is interesting how sometimes entrepreneurs which are just hard working, make it happen people, that have to have some good articulation skills and some broad understanding skills, can partner with a scientist, an engineer, that has come up with these ideas, and boy when that partnership works well, it produces significant results.
Mark: And that's what we hope for our partnership with the Wolff Center. We've had some initial successes with our students have gone out and utilized live IP here at U of H and won some national business competitions, we see it as a model that not only provides an academic experience for our students here in the Wolff Center but it also provides a potential pathway for both our faculty and our students to be successful in terms of taking a technology to market and generating a spinoff. Our view is – the strategic view of the university is that this is part and parcel of our research and education missing and as such, we're willing to support our students and faculty to be successful.
Russ: Interesting. So selecting the path for a particular technology obviously is critically important. I almost compare it to a venture capitalist in evaluating what they do, where they make investments. But so how does the process go, in any of those categories, even if you're just licensing? You don't just license it to anybody. If you're actually partnering with a commercial entity, it's critical that you partner with the right one. I assume there's competition sometimes amongst people. So and then even when you bring things here to the Wolff Center, how do you decide, well, that would be a good category there?
Mark: Well, if we answer the first part of that question which is what is the process here at U of H, the vast majority of our technology is what we call unattached technologies. They come from the basic research that our faculty members are doing in their labs, and that's captured through the IP process here in my office, OIPM. Sorry the acronyms come from when I worked at NASA.
Russ: I understand.
Mark: The office of intellectual property management. That process is essentially a back office operation. We protect that and at that point, we start looking for partners. For the other part of the – mentioned the fact that what we call unattached technologies, we also have attached technologies. Those are technologies that are more – have been funded primarily from what we call a sponsored research agreement from industry partners and those technologies have been developed to solve operational problems. So it's not necessarily some new, basic research concept that has been generated as IP. Once we've protected it, we then, as I say, start to look for potential licensing opportunities or potential partners that would like to help us continue to develop the technology. One of o the new programs that we've initiated over the last year is a program – an internal funding program called the UH gap – technology gap fund, and that is essentially a fund where our inventors can compete for funding to help them with the development of a prototype or specifically reduction to practice of their IP. That's not a science project, it's not a research project, the faculty members are funded for a period of six months with milestones associated solely with developing prototypes or reducing to practice. So that their technology becomes more attractive to a potential commercial partner.
Russ: And that funding comes through the university?
Mark: Through the university, it's an internal fund that was set up specifically for this function.
Russ: I'm interested in this category, this topic that we're talking about, because partnering becomes so critical, ultimately, to success. I remember when I was raising venture funds, people – entrepreneurs would always say, "Well how do you know which one to choose?" to which my answer was, "Well, I'm going to choose the one that is willing to fund me," [laughter] and that's what intrigues me about doing it at the university level. I'm curious, also, though, when you're selecting a path for an intellectual property and does the inventor scientist themselves have a say in it?
Mark: Yes. We strongly believe that our faculty, when they create this IP, they're part and parcel and I'm sure you know that certainly in the early stages of a startup company, if the inventor's not involved the chances of success are significantly reduced, especially when it comes to technology based efforts. I think that to be clear about the process at U of H, with regard to the UH gap – technology gap fund, is that those decisions are actually made by external entities. We do have a standing committee, the IP committee, here at the university, which is part of that process, but the score is weighted much more highly for a group of external reviewers that are experts in that particular commercial sector and we believe that the university should not be picking winners and losers. What we should be doing is asking the rest of the community what do you think is a viable technology and how can you help us get it to market? So we're the – hopefully facilitating that process.
Russ: Right, and that's kind-of like opening it up to the market, so to speak.
Russ: To a degree. Do you have faculty inventors that insist or that want to be the CEO of this new entity?
Mark: Yes, I would say that it's interesting that I'm an inventor. I would say that I'm not necessarily an entrepreneur. I didn't give up my tenured faculty position to go out into the world.
Russ: Like a real entrepreneur would.
Mark: Like a real – entrepreneurs have a very interesting perspective so I have some parts of that, but I am an inventor so we have lots of faculty members who are inventors who really don't want to be entrepreneurs in the true sense. What's – just as an aside, we're heavily involved with the National Science Foundation's program called the Innovation Core or I Core, and one of the things that NSF has sort-of observed over the years is that a lot of the technologies that they've funded in the basic part of the process, a lot of the faculty members are not really interested in taking those technologies to market. However, they are very interested in having their students do it, in that they want their students to be successful and this is another pathway which students can be successful. So NSF has developed this program, the Innovation Core, the I Core, where they entrepreneurial lead is not the faculty inventor, it's actually one of the students. That's another part of this concept of trying to develop the entrepreneurial workforce that we need not only at U of H, but actually for the region and the greater Houston area I think is important part of this.
Russ: When we talk about faculty inventors, are there some category of student inventors that have IP here?
Mark: Until very recently students and specifically undergraduate students in that most graduate students are actually considered an employee. But a student did not have the opportunity to essentially commercialize their technology through the university. Beginning last year, we put a program in place where that pathway is now open to our students, if the student wishes they can assign their rights to IP that they've generated as part of their academic training here at U of H and U of H will then treat them like a faculty member. So we have a – quite a – I would say generous policy when it comes to sharing any upside or any revenue that's generated from our technologies. 40 percent of it goes back to the inventor and the university essentially takes care of the IP protection process and then provides a variety of help to the inventor in terms of trying to get it commercialized.
Russ: I would assume that all of this IP is fairly sophisticated coming out of a university and so forth, so this question might be non-applicable but is there ever a time where you go, "My goodness, we have these five million ideas here and we're not certain what to do with them, but let's sort-of have an open forum almost like an open bid, if you're interested in any of these, let us know," does that ever happen?
Mark: Not as yet. I would say that as you indicated, a lot of the technology that we have are on the high technology side and as a consequence the commercial partner arena is pretty limited for some of those. So for example, resistive memory, we know which industry sector is interested. But we do have a very productive industrial design group here that comes up with what I would consider to be on the consumer side of electronics or packaging and those are some things that we've recently got into in that they come through the student side of the IP flow and those potentially are going to be just opened up in terms of here's – and that the IP is usually more around the design rather than a fundamental discovery.
Russ: Right, real interesting. So before I let you go, I have to ask you if you would tell us what your invention is and I assume it's this active one now, that's still sort-of in business and you have to kind-of – you kind-of have to low grade the technology so I can understand it [laughter] so what in the world is that, Mark?
Mark: We have a small startup company that licensed the technology from U of H, it's called Osteosphere Inc., it is a orthobiologics company, orthobiologics meaning bone and materials that can be used to treat various bone diseases. Specifically this is a system utilizing a technology that was developed originally at NASA which I called the rotating vessel or the bioreactor which allows us to assemble individual cells that we harvest from a patient from their blood and from their bone marrow, to put them together into a three-dimensional construct that eventually – three-dimensional construct being all the cells, which then self assembles into a structure that looks and behaves like real human bone, except we're doing it outside of the body, and that technology – our main focus is the use of that material in reconstructive bone surgery, in that you can shape it, meld it, and one of its advantages is that it makes a lot of growth factors that are essential for the process of bone healing. So in those individuals that have what is known as non-union, which is essentially for no apparent reason the bone will not heal, this is one of the approaches that they've tried to use in the past clinically is to put certain growth factors known as bone morphogenic proteins into the system. We do it using material that was actually generated externally to the body and allows you to stimulate that bone growth in a way which doesn't happen in that particular patient.
Russ: Could be extremely important to a lot of people.
Mark: I hope so, as I say, we're in the process of searching for series A funding. We've had some big brother help from some of our larger orthopedic companies to do some of the basic research associated with it but.
Russ: Well Mark, I really appreciate you giving us some of your time and the perspective of what you're doing here at the University of Houston.
Mark: Great, thanks Russ.
Russ: You bet.
Mark: Pleasure to be here.
Russ: You bet, and that wraps up my discussion with Dr. Mark Clarke, the head of intellectually property commercialization here at the University of Houston. This is The BusinessMakers Show, heard on the radio and seen online at TheBusinessMakers.com.