Creations Can Push Career Into Overdrive Texas Institutions Fall Behind As More Universities Seek Windfall From Profit-Minded Professors

Creations can push career into overdrive Texas institutions fall behind as more universities seek windfall from profit-minded professors. By Eric Dexheimer AMERICAN-STATESMAN STAFF Sunday, October 15, 2006 HOUSTON As a new faculty member at Texas A&M University 17 years ago, chemical engineer Mark Holtzapple was scolded during a tenure review: Too much of an inventor. That criticism was a distant memory when Holtzapple stood before a roomful of potential investors at the InterContinental Stephen F. Austin Hotel recently, presenting his latest research into superefficient compressors and engines. After a few PowerPoint technicalities, the now-tenured professor, dapper in a beige suit and tie, moved in for the close. We want to develop a cash cow, he said. A company that spews out money like a cash machine. Oh, yeah, he added. We want to save the world. He stepped down to enthusiastic applause. He's one of our superstars, an A&M spokeswoman gushed as venture capitalists gathered around a display of Holtzapple's latest work. Once shunned as sell-outs slumming in the real world, profit-minded professors such as Holtzapple are now being warmly embraced by research universities that covet the potential riches from patents, licenses and spinoff companies born of faculty inventions. Many schools see creating wealth and jobs as a modern extension of their mission to serve society. But withsteep tuition increases, cuts in state higher education funding and fierce competition for federal research grants,commercializing faculty inventions known as technology transfer is also becoming part of academia's bottom line. Some universities earn hundreds of millions of dollars licensing their faculty's work, typically splitting royalties with the inventors. But despite their size and the billions of dollars they spend on research, Texas schools have lagged by most measures of success. As a system, the University of Texas earns barely half the national average of income per research dollar it spends. In a report on university biotech commercialization released last month, no single Texas public university was listed among the top schools. In 2004, Texas' public universities together collected $38 million from faculty inventions but spent almost $17 million on administrative and legal costs doing it. Only nine schools of 19 earned more money than they spent trying to commercialize faculty inventions; two of those earned less than $20,000. The University of Texas Medical Branch at Galveston reported a $750,000 deficit, the largest among Texas public schools. Income is creeping up at some campuses University of Texas-Southwestern Medical Center ranked 19th in 2004 income among U.S. universities and school officials insist that they are working hard to improve. (Robert Barnhill, vice chancellor of research and technology transfer for the UT system, resigned this month after only 18 months on the job; he and the university declined comment.) A&M, in particular, has embraced capitalism with a vengeance. This summer, the school became the first in the nation to formally begin considering patents or commercialization of research along with traditional yardsticks such as teaching and publication when deciding whether to grant tenure. We want to send a message that Texas A&M is open for business, explained Chancellor Robert McTeer, a former Federal Reserve Bank president. Yet squeezing cash from university research is fraught with high obstacles, low odds and ambiguous ethics.