Busch report on Novartis/Berkeley research arrangement

Under the Bayh-Dole Act of 1980, a university may grant an exclusive or non-exclusive license to patents obtained with federal funding, subject to certain rights of the funding agency. The idea is that the university is to identify the best entity to commercialize the invention, with preference to be given to small, American companies. In the Novartis/Berkeley arrangment, Novartis was given the right of first refusal over inventions of an academic department, including those obtained with federal funds. In effect, the decision-making capacity about licensing resided with Novartis, not with Berkeley. Neither Novartis, nor the successor-in-interest, Syngenta, are small American companies.

I had written about the Novartis/Berkeley interaction in "Implicitly Zurko," Intellectual Property Today, p. 22 (July 1999), and in "The Things We Lean On Are Things That Don't Last," Intellectual Property Today (February 2003), both available on LEXIS.

A review by Michigan State University sociology Professor Lawrence Busch (who lead a group of 10 people at MSU) is scheduled for release on August 1, 2004.
[available: http://www.berkeley.edu/news/media/releases/2004/07/external_novartis_review.pdf]

It appears that the Busch report may have overlooked issues that I raised in my 1999 article.


From San Francisco Chronicle. Saturday, July 31, 2004.

BERKELEY/Probe of research pact at Cal released/While no harm was done, avoiding such deals in future urged
Charles Burress, Chronicle Staff Writer


UC Berkeley's $25 million deal with the giant Novartis drug company, a lightning-rod symbol of corporate sponsorship of university research, did not wreak the harm feared by critics, but such broad agreements should be avoided, according to a long-awaited independent review.
While the report found that the deal did not compromise research, it did find there was "little doubt" the pact played a role in another controversy that cast a cloud over the university -- the denial of tenure to Assistant Professor Ignacio Chapela, a vocal critic of the agreement.
"The greatest hopes of its supporters and the greatest fears of its detractors have not come to pass," notes the 188-page report written by Michigan State University sociology Professor Lawrence Busch. He led a team of 10 Michigan State researchers commissioned by the Berkeley faculty and funded by the Berkeley campus.
Supporters said at the time that the 1998 deal could generate
important licensing and patent breakthroughs, and provide much-needed funding at a time when public support for higher education was declining.
The study found Novartis did not license any research stemming from the pact. Funding for plant biology at Cal rose significantly under the contract, but the report found another biology department at Berkeley and one at Michigan without such a contract also saw significant income jumps during the same period.
The review, which took two years, is scheduled to be released
Sunday.
The five-year deal, which offered $25 million to Cal's Department of Plant and Microbial Biology for research and operations, drew heavy criticism from those who saw the university selling itself to commercial interests.
It played prominently in the "The Kept University," an article in the
March 2000 issue of Atlantic magazine.
The sponsor was Novartis' research arm, Novartis Agricultural
Discovery Institute, later taken over by Swiss-based Syngenta.
Novartis opened its databases to Berkeley and was given seats on the department's research-review committee and first rights to bid on
licensing research from the department -- even that sponsored by
government funds.
The report said the contract, which expired in November, was "not
far from the norm" for corporate-academic cooperation but for two key features:

--> the questionable first-access to research that Novartis didn't finance and
--> the involvement of an entire university department.

Some faculty members and graduate students within UC Berkeley's
College of Natural Resources, which includes the plant biology department, felt tainted by the association, and there is "little rationale" for such a department-wide approach, according the report.

The report recommends that Cal avoid such arrangements in the
future.

Chapela, who chaired the College of Natural Resources' executive
committee, was a leading critic of the deal. The report details the
unusual process by which he lost his tenure bid despite a 32-1 vote in favor of tenure by his faculty colleagues in the environmental science,policy and management department and unanimous approval by a
five-member ad hoc tenure committee.
(...)
In a prepared statement, Executive Vice Chancellor and Provost Paul
Gray said the report "provides data to show that the (plant and microbial biology) department is healthier today than it was before the agreement was put into place." He noted an increase in funding from other sources
and a rise in graduate student applications.
(...)

Anne MacLachlan, a researcher for the Center for Studies in Higher
Education and the campus liaison to the study group at Michigan State, said she concurred with the report's conclusions, though she faulted it for some minor errors.
She also criticized the report for not placing greater emphasis on the secrecy surrounding the formation of the agreement, one reason "why the faculty was so angry" about it.
The report's conclusion that research and academic integrity was not contaminated echoed the results of an earlier internal review by the Office of the Vice Chancellor for Research released in January 2003. A June 2001 article in the Chronicle of Higher Education also reported that none of dozens of people interviewed could cite an instance of research compromised by the deal.