1

OTT-- The First Five Years:

Summary and Road Forward

Wayne E. Swann

December 2004Patents and Pizza Seminar Series

Technology Transfer at APL

2

• Broaden the public benefits derived from APL technology;

• Create jobs and improve the economy of the community, state and nation;

• Enhance APL’s image as a creative and innovative institution, and attract new talent and challenging work; and

• Acquire unrestricted funds for future scientific research and technology development at APL and within JHU.

Technology Transfer Summary

APL 1998 Study - Benefits of Technology Transfer:

3

Technology Transfer Summary

Operations Staff/Organization; Scope of Activities

Performance Metrics Historical Perspective; Comparisons

The Environment APL; JHU; County; State

Income and Expenditures Review; Self-Sufficiency

4

OTT Operations

Staff

Organization

Scope of Activities

Technology Transfer Summary

5

John Bacon, Technology Manager

Donna Couturiaux, Office of Technology Transfer Coordinator

Susan Furney, Technology Programs Assistant

Kristin Gray, Assistant Director of Technology Transfer

Leslie Martinelli, Administrative Assistant (part time)

Heather Prettyman, Technology and Marketing Associate

Randall Slagle, Technology Manager

Wayne Swann, Director of Technology Transfer

Norma Lee Todd, Director of Technology Programs

OTT Operations: Staff

6

OTT: Functional Organization Chart

DIRECTOR OF TECHNOLOGY TRANSFER

WAYNE SWANN

ASSISTANT DIRECTOR

OF TECHNOLOGY

TRANSFER KRISTIN GRAY

ADMINISTRATIVE ASSISTANT & OTT

COORDINATOR DONNA COUTURIAUX

TECHNOLOGY

PROGRAMS DIRECTOR NORMA LEE TODD

SENIOR TECHNOLOGY

PROGRAMS SPECIALIST SUSAN FURNEY

TECHNOLOGY/MARKETING ASSOCIATE

BIOMEDICAL AND MATERIALS & STRUCTURES

HEATHER PRETTYMAN

TECHNOLOGY MANAGER

INFORMATION, COMMUNICATION, MODELING AND SYSTEMS

RANDALL SLAGLE

TECHNOLOGY MANAGER

SENSORS, ELECTRONICS

INSTRUMENTATION JOHN BACON

INTELLECTUAL

PROPERTY TEAM

TECH TRANSFER

DEPARTMENT

TEAM

MARKETING

TEAM

APL LEADERSHIP TEAM SCIENCE AND TECHNOLOGY COUNCIL

BUSINESS REVIEW COUNCIL IP POLICY ADMINISTRATION

TECHNOLOGY/MARKETING

MANAGER VEHICLE AND SPACE &

ENVIRONMENTAL PHYSICS NORMA LEE TODD

SENIOR TECHNOLOGY

ADMINISTRATION

SPECIALIST LESLIE MARTINELLI

IN-REACH PROGRAMS

7

In-Reach

• Recognize, Reward, Promote Innovation and Innovative Work Environment

• Dept. Tech Transfer Team; Teach Class• WSE – Student Technology Commercialization

and Entrepreneurship program

Outreach/Economic Development

• State: TEDCO/DBED;Tech Councils

• HCEDA (NeoTech, Missions)

• Businesses/Organizations

• Enhance APL’s High-Tech Image - New APL CD Bus. Card

APL Leadership Activities

• Technology CompetitivenessInnovation Output Metric analysisInnovation Outcome Proxies – Licenses

and Patent Citations Analysis

• Science and Technology CouncilS&T Staff CapabilitiesAPL/Business Area Profiles

Technology Transfer

• Technology Licensing

• Fund Technology Development

• Facilitate Interactions with Industry

• Facilitate New Company Formation

• Improving Technology Transition – to USG Contractors - FST as Model

Tech Transfer Operations – Scope of Activities

8

Performance Metrics

Historical Perspective

Comparisons

Technology Transfer Summary

9

Innovation Output Comparison APL/AUTM Invention Comparison

50

58 56 56 5862

69 72 7276

80 8187

76

64

44

24

40 41

4853

67

143

126 125 124

151

0

20

40

60

80

100

120

140

160

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

AUTM - Average Invention Disclosures

APL- Invention Disclosures

10

Innovation Output ComparisonAPL/AUTM Issued Patents

11

1312

14

17

20

2223

22

20

10

12

8

65

2

54

5

12

10

14

22

31

22

0

5

10

15

20

25

30

35

40

45

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

AUTM - Average US Patents

APL - US Patents

An Additional 23 US Patents had already been allowed, and were awaiting issuance, by the USPTO at the end of GFY 2004

11

Innovation Outcome Comparison

APL/AUTM Technology Licenses

11

15 1517 17 17

2123 24 25

23 24 25

3 3

0 0 0 1 2

12

1618

35

49

0

10

20

30

40

50

60

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

AUTM - Average License Agreements

APL License Agreements

12

• Inventions 151* 669• Licenses 49* 130• Total US Patent Applications 238* 902• Issued US Patents 31* 89• Start-up Companies 4* 14• License Income (Millions Received) $2.0 $9.4• Associated R&D (Millions Committed) $2.7* $9.6

(~60% of R&D commitments already received)

Performance Metric 2004 5-Yr Total

* Denotes all time high

Technology Transfer Summary

13

2004 Performance Metrics Update1

Metric AUTM Rank Percentile

• Inventions 23rd 15th

• Licenses 23rd 15th

• Total US Patent Applications 6th 4th

• Issued US Patents 30th 19th

• Start-up Companies 21st 14th

• License Income 56th 36th

• Associated R&D Income 14th 9th1 Latest AUTM Survey Data - Where APL would Rank out of 151 Research Universities in the US (including 94 of the top 100).

Technology Transfer Summary

14

APL

Performance Metrics• New Invention Disclosures 15 • New Licenses 5.0 • Total US Patent Applications 24 • Issued US Patents 3.2 • Start-up Companies 0.4 • License Income (~$000) 200 • Associated R&D (~$000) 270

OTT Performance Comparisons Output Per Full Time Tech Transfer Staff

15

APL Inventions, Patents and License ProfileAPL Data by Category

All subcategories selectedas of October 31, 2004

0%

5%

10%

15%

20%

25%

30%

Biomedical/Biochem

ical Technology

Communications an

d Distributed

Systems

Electro

nics Technology

Information Processing and Managem

ent

Material

s and Structu

res

Modeling an

d Simulation

Sensors and Sensor S

ystems

Space an

d Environmental

Physics

System Analy

sis, Test

and Evaluation

Vehicle Tech

nology

Inventions

Patents

Licenses

16

Technology Transfer Status: Products

Survey Landform Analysis

(Optech >$100,000/year Royalties)

WAVES

(Shell; Multiple Licenses)

QTViewer (3-D Color Modeling)

(34 Licenses; Applied Imagery just formed)

Polyscore (Windows)

(Lafayette >$100,000/year Royalties)

17

The Environment

Applied Physics Laboratory

Johns Hopkins University

Howard County

State of Maryland

Technology Transfer Summary

18

County

• Local environment - Not Silicon Valley; center of B/W Tech Corridor

• APL is the big player in the County

• Focus on entrepreneurial environment

• Opportunities – HCEDA partnerships - new Tech Leadership Consortium

State

• TEDCO “Tech Trans. Improvement - all progress at JHU, all from APL”

• State - positive view of Howard Co.

• Gap Remains - Funding of Start-ups

• Significant Econ Dev. Value in TT

• Fed Lab Tech Transfer issue remains

JHU

• State of Tech Transfer at JHU National search for leader OTT/LTD - good relationship

• Building relationship with WSE Entrepreneurship

Technology Transfer: The Environment

APL

• Inventions, Patents and Licenses are at all time highs (6/7 metrics)

• Innovation is being recognized as being very important to APL

• Tech Transfer 5 years later…

generally good

19

APL Technology Transfer Benefit to the Public

Five Year Data 71 Different Technologies Licensed

15 Commercial Products/Processes

52 New Jobs Created From APL Start-ups

Economic Development Impact

One Piece: Salaries generated by new jobs

TEDCO New Job Multiplier and Average Salaries

>$5 Million Annual Salaries in Maryland Generated by APL Start-ups

20

Income and Expenditures:

5 Year Review

Licensing Income

Operational Expenditures

R&D Grants

Technology Transfer Summary

21

Royalties, R&D Income & Cost Reimbursements to APL

Total APL Receipts $ 22,705,291

OTT, OPC, Patents, APL Grants & Income Distribution Costs

Total Expenditures/Distributions $ 21,533,654

Net Income (loss) to APL $ 1,171,637

GFY 1999-2004 APL Income and Expenditure Summary Technology Transfer Program

Dev Fund for GFY 2004 = ($248,775)

22

Technology Transfer Status Income and Expenditures

Summary: Tech Transfer Grants to APL Staff (GFY 2000-2004)

APL Dev Fund Grants $ 1,503,183

Other Grant Funding (TEDCO, IRAD) $ 770,346

Total Received $ 2,273,529

Total of 119 Grants to APL Staff

23

OTT Overhead Costs

Percentage of OTT Administrative Costs Charged to Overhead

72% 74%

58%

46%41%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2000 2001 2002 2003 2004

Does not include Patent Costs or Tech Transfer Grants to Departments

24

Technology Transfer Status

DCAA/DCMA Disallowance has major impact on OTT/OPC

Average Licensing Income of $2 million/year is not enough for self-sufficiency

OTT needs to chart a different course on the road to self-sufficiency

25

Maintain Performance Metrics

Technology Transfer at APL

The Road Ahead

Achieve Self-Sufficiency

26

The Road Ahead: Achieve Self-Sufficiency

Reduce Short Term Costs Reduce activities that do not generate short term

income

Reduce/Delay the number of new patent applications

Reduce OTT Operational Costs

Generate Short Term Licensing Income

Director of TT/ Tech Managers “Top 10” List

Implemented effort with A&F to promptly invoice

Activity Focused on Recovering Costs: Recover Patent Costs – Improved A&F System; Terms Recover (Disallowed) Costs - 15% Administrative Fee

(Stanford, MIT); Licensing Expenses (IP Policy)

27

Summary

Financing Operations

• Income fluctuates (mostly fees)

• Royalty base (& equity) immature

• Transitioning costs to Dev. Fund

• Cost cutting measures underway

• DCAA allowance issues remain

• Self-sufficiency not yet achieved

The Environment

• Tech Transfer at APL – Generally good

• JHU/LTD Transition – APL/OTT Licensing Joint JHU Inventions

• County – Good Partnership with EDA

• State – Want More Tech Transfer Value From Universities/Govt. Labs;

and view APL as model

Inventions, Licenses, Patents

• Innovation increasing (very high)

• License rate maturing/matured

• Issued Patents maturing/costly

• Approaching 2X AUTM Averages

• Products are finding way to market

• Start-ups take time - nurture/mature

OTT Operations

• Administration, staffing, training, programs in place – workload high

• Infrastructure (databases, etc.) functioning/improved efficiency

• Expanding the impact (FST)

• Focusing on Licensing Income

28

OTT-- The First Five Years:

Summary and Road Forward

Questions

Technology Transfer at APL

The Road to Pizza!!!!