November 2-3, 2011

New Delhi

BACKGROUND PAPER

Disclaimer :
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representation or warranty expressed is made to their accuracy, completeness or correctness. This document is for information purpose only. The
information contained in this document is published for the assistance of the recipient but is not to be relied upon as authoritative or taken in
substitution for the exercise of judgment by any recipient. This document is not intended to be a substitute for professional, technical or legal
advice. All opinions expressed in this document are subject to change without notice.
FICCI, Battelle India and ISB are not liable for any direct or consequential loss howsoever arising from use of this document or its contents or
otherwise arising in connection herewith.

Introduction
Federation of Indian Chamber of Commerce & Industrys S&T / Innovation Committee is pleased
to present the Background Paper, which is being released at the commencement of the
conference: India R&D 2011 Industry & Academia Linkages.

Dr. Makarand Phadke

Considering the emerging competitive landscape since economic liberation, the paper argues
that the Indian industry needs to enhance its efforts towards developing new products/
processes and develop R&D capabilities, which will be a key success factor towards this mission.
The paper further articulates that having strong Industry & Academia Linkages will lead to
creation of an ecosystem that will allow the Industry to achieve its objectives.
The paper should therefore serve as a basis for the conference deliberations and we hope that
the discussions at this conference will build on the foundation laid down in the paper.
We are thankful to Mr. Shalendra Porwal & his team at Battelle India and Dr. Nita Sachan &
Dr. Charles Dhanraj of Indian School of Business for their commendable efforts in bringing out
this paper.

Dr. Makarand Phadke

Chairman - S&T / Innovation Committee
Federation of Indian Chambers of
Commerce and Industry

Foreword
Traditionally, academia and industry had a mere producer-consumer relationship, wherein, the
former produces knowledge and trained human capacity for consumption of the later. However,
beginning with the advent of industrial era and its rapid proliferation across the world, needs of
the industry, both in terms of type of new knowledge creation and kind of manpower
requirement, started shifting gears. This was precisely when the erstwhile status-quo position of
industry-academia relation began to quiver and called for transformation in its underlying
philosophy and function.

Dr. Rajiv Kumar

Although, history of technological evolution conclusively shows that most breakthrough
industrial innovations had come through advancement in fundamental academic research,
industry in general, remains apprehensive that majority of academic research bears no or little
relevance for them. An objective analysis of this dichotomy, particularly in context of developed
countries, reveals that while it serves best for academic research to be driven primarily by
academic needs alone, it is still possible to reap industrial dividends of pure scientific discoveries
by skillfully converting them into sizeable technological opportunities through well coordinated
and mutually orchestrated efforts between academia and industry.
Having ushered into a new era of economic and industrial development, it is probably the most
opportune point in time for us to relook at our existing industry-academia dynamics, take stock
of benefits and bottlenecks and initiate collective efforts to improve in ways that might best
serve the need of the time.
I am confident that India R&D 2011, under the theme 'Industry-Academia Linkages' will serve a
valuable purpose in creating the right forum for discussion, debate and delineation among all
stakeholders towards fostering a more fulfilling collaboration among Indian academia and
industry that could possibly catalyse the economy towards even greater heights.

Sincerely

(Dr. Rajiv Kumar)

Secretary General
Federation of Indian Chambers of
Commerce and Industry

Preface
To sustain a high rate of growth of economy and to establish itself as a global R&D and
innovation hub, India needs to pay serious attention to Applied R&D. The Indian
companies have to strengthen their in-house R&D and develop original products and
technologies of global standard. Industry-academia linkages will have critical role in
supporting this transformation. Industry needs to move away from the mentality of
quick acquisition of technology and invest in internal R&D and the academia has to revector its goals and increase its participation in applied research.
The government also has a vital role in this transformation. While the earlier Five Year
Plans have strengthened R&D, the 12th Five Year Plan needs to re-emphasize the role of
applied R&D and propagate policies that incentivize organizations that invest in internal
R&D and make efforts to develop and commercialize new, indigenous products and
technologies. As the spending on R&D goes up from current 0.9% of GDP to projected
2% of GDP in the next few years, it will be necessary to channelize a higher fraction of
the R&D funds toward applied R&D.
This Background Paper highlights various challenges facing applied R&D in India and
briefly discusses a few examples of different types of consortia and R&D models that
can be useful in India. We believe that selected recommendations we put forth will pave
the way for creating a balance between the collaborative research efforts of industry
and academia.
Battelle India Swapnil Gawade, Deepti Srivastava,
Christeena Thomas, and Shalendra Porwal
Indian School of Business Nita Sachan, Charles Dhanaraj

Executive Summary
Coupled with the vast scientific infrastructure seeded since post independence days
with sophisticated academic institutions, such as IITs, IIScs, and public research
institutions, such as CSIR, the twenty first century has ushered India into a technology
era. According to the 12th Five Year Plan, the total R&D expenditure in India is
estimated at about 0.9% of the national GDP of Rs. 78, 58,305 crores. Of this threefourths of the funding was done through the public sector (Rs.53, 044 crores) and the
rest was from private sector (Rs. 17, 681 crores). In 2009, R&D spending of the largest
100 Indian companies was about Rs 11,500 crores.
The growing talent pool has been a significant draw for an increasing number of R&D
investments by major Multinational Companies (MNCs) like GE, Texas Instruments,
Astra Zeneca, DuPont, Motorola, Intel, etc. Sectors such as pharmaceuticals,
biotechnology, automobiles, and telecommunications have seen not only MNCs leading
technology development, but also a large number of domestic players such as the Tatas,
Birlas, Biocon, Godrej, and others, who are redefining R&D with a unique focus on mass
markets in India. Tata Nano, Tata Swatch, and Godrej Chotucool, are just some of the
names that have served to strengthen the image of Indian R&D around the world.
Despite this strong accolade, there are serious issues that plague the R&D landscape in
India. These threaten the long-term growth prospect for the country and reach its full
potential. Despite the growing talent pool, Indian R&D base remains globally noncompetitive. India has an estimate of full time equivalent R&D professional strength of
only 150 professionals per million as compared to that of China (1,180 per Million),
Korea (2900 per Million), USA (4300 per Million), UK (2880 per Million), and Finland
(7300 per Million)1. Indian research capacity is mostly skewed towards basic research
and lacks in application oriented R&D. While we have several exemplars in highly
innovative R&D, the vast majority of organizations would rather go for quick acquisition
of technology rather than invest in internal R&D. On the other hand, academic
institutions and many of the public research centers focus on advancing the science,
focusing on patenting and publishing, with very little systematic attention being spent in
applied R&D.

Annual Report of DST 2010-11

This paper aims to provide an overview of the need for applied R&D in India, and its
potential to enable India to continue its growth trajectory and to enhance India's global
stature. Ironically, academia industry linkages can serve as the best way to realize this
true potential. The paper identifies the most significant challenges in promoting such
R&D, and presents a way forward for action by the industry, policy makers, and
businesses.
A systematic study of the R&D management issues suggests seven major challenges,
listed below:

Lack of an appropriate mindset

Insufficient resource base

Lack of commercialization capabilities

Lack of intellectual property infrastructure

Lack of incentives

Absence of collaboration across companies

Absence of regulatory framework for academia-industry collaboration

There are challenges at every step and a single solution may not be feasible for all
situations. But an integrated approach can help in bringing technologies to the market
at a faster pace required by the growing economy.
Institutes like IIT's and IIM's are already building incubation centers and working
towards an applied R&D model. But more needs to be done to fill in the gaps existing in
these models and look further beyond the campus for improvement in the incubation
model. There are several such models existing around the world such as Silicon Valley
and its association with Stanford University, TechColumbus in Central Ohio in United
States and more recently the technology parks set up at the Universities in Brazil. Exact
replication of these models is not feasible due to variation in the local industry
dynamics, but there are some takeaways to strengthen academia-industry linkage in
India.
A brief listing of selected recommendations is provided below.

Increase awareness of incubation cells and their utility

Improve integration for better access to resources

Establish industry R&D centers at university campuses

Establish technology transfer offices

Establish contract R&D institutions

Establish knowledge network

Provide incentives for scientists, academia, research institutes, and private

companies involved in applied R&D

Establish R&D management courses for mid-level managers

We urge the reader to browse through the Recommendations section of this paper for a
more detailed discussion of these and other recommendations.

Contents
1.

2.

3.

The Emerging R&D Landscape in India

1.1.

Basic vs. Applied R&D

1.2.

Applied R&D and Product Development Process

1.3.

Roles of Academia and Industry in Applied R&D

12

Status of Applied R&D in India

17

2.1.

Academia

18

2.2.

Public Funded R&D

21

2.3.

Patenting Trends

23

2.4.

Incentives in Applied R&D

26

2.5.

Models for Applied R&D

28

2.6.

Research and Development Consortia

31

2.7.

Open Source Models

35

2.8.

Proposed Actions in the 12th Five Year Plan

36

2.9.

Discussion

37

Challenges

41

3.1.

Mindset

42

3.2.

Lack of Resources

43

3.3.

Challenges in Intellectual Property Generation

45

3.4.

Challenges in Commercialization

50

3.5.

Challenges in R&D Consortia

50

3.6.

Regulatory Issues

51

3.6.1. Bayh-Dole Act

51

3.6.2. Protection and Utilization of Public Funded Intellectual

Property Bill (PUPFIP)

52

3.6.3. Intellectual Property Appellate Board

53

4.

Recommendations

55

4.1.

Academia/Industry Linkage

56

4.1.1. Increase Awareness of Incubation Cells and Their Utility

56

4.1.2. Improve Integration for Better Access to Resources

56

4.1.3. Establish Industry R&D Centers on University Campuses

57

4.1.4. Establish Technology Transfer Offices

57

4.2.

Establish Contract R&D Institutions

58

4.3.

Establish Knowledge Network

58

4.4.

Regulatory Recommendations

58

4.5.

R&D Consortia and Open Innovation

59

4.6.

Technology Transfer and Incubation

59

4.7.

IP Infrastructure and Regulation

60

4.8.

Incentives

60

4.8.1. Incentives for Scientists

61

4.8.2. Universities and Research Institutions

61

4.8.3. Incentives for Firms

62

Training

62

4.9.

List of Figures
Figure 1:

Indian Science and Technology Structure

Figure 2:

Trend in Growth of R&D Centers and R&D Talent Pool in India

Figure 3:

World of R&D 2010

Figure 4:

R&D Spend Structure in India in 2010

Figure 5:

Commercial & Industrial Technology Development Cycle

Figure 6:

Stages of Product/Technology Development in Applied R&D

10

Figure 7:

Stakeholders in New Product/Technology Development

11

Figure 8:

Need for Academy - Industry Linkage

13

Figure 9:

Models of Co-operation

14

Figure 10:

Various Funding Options Offered by Ministry of

Science and Technology

22

Figure 11.

Modes of financial assistance provided by TDB from 1997 to 2010

22

Figure 12:

Patent Application Trend in India

24

Figure 13:

Types of IP Applications in India

25

Figure 14:

Foreign Applications in India in 2009-2010

25

Figure 15.

Trend of International Applications from India

26

Figure 16:

Example of Technology Commercialization Model Integrating

Resources from Various Stakeholders

29

Figure 17:

CAR Work Flow Diagram

33

Figure 18:

Activities at Auto Cluster in Pune

33

Figure 19:

Graph showing focus on In-house R&D in emerging economies

like India, China and Brazil

39

Figure 20:

R&D Project Cost Break-up of DST in 2010-11

47

Figure 21:

R&D Projects Sanctioned During 2010-11 by DST

48

Figure 22:

Number of Cases Handled by IPAB

54

It is science alone that can solve the problems

of hunger and poverty, of insanitation and
illiteracy, of superstition and deadening of
custom and tradition, of vast resources running
to waste, or a rich country inhabited by
starving poor... Who indeed could afford to
ignore science today? At every turn we have to
seek its aid... The future belongs to science and
those who make friends with science.
Pandit Jawaharlal Nehru

The Emerging R&D Landscape in India

Indian economy has changed dramatically since the economic liberalization in 1991.
Over the last two decades, a quiet revolution has been unfolding in India, growing
slowly but steadily. Indian industry has been building up its technological capabilities.
The growth in the Information Technology (IT) sector unleashed a huge momentum in
human capital in India. The growing talent pool became a significant draw for an
increasing number of R&D investments by major Multinational Companies (MNCs) like
GE, Texas Instruments, Astra Zeneca, DuPont, Motorola, Intel, etc. In addition, a large
number of domestic players like the Tatas, Birlas, Biocon, Godrej, and others have
redefined R&D with a unique focus on mass markets in major sectors including
automobiles, biotechnology, pharmaceuticals, and telecommunications. Tata Nano, Tata
Swatch, and Godrej Chotucool are just some of the names that have served to
strengthen the image of Indian R&D around the world.
Multinational companies (MNCs) seriously began to explore India's potential as a
research destination more than a decade ago. In the late 1980s and early 1990s, some
MNCs set up research labs in India. However, this early wave largely consisted of what is
sometimes called "insourcing" -- MNCs opened research labs to serve their own local
manufacturing operations2.
Despite this strong accolade, there are serious issues that plague the R&D landscape in
India. These threaten the long-term growth prospect for the country and reach its full
potential. Despite the growing talent pool, Indian R&D base remains globally noncompetitive. India has an estimate full time equivalent R&D professional strength of
only 150 professions per million as compared to that of China (1,180 per Million), Korea
(2900 per Million), USA (4300 per Million), UK (2880 per Million), and Finland (7300 per
Million)3. Indian research capacity is mostly skewed towards basic research and lacks in
application oriented R&D. While we have several exemplars in highly innovative R&D,
the vast majority of organizations would rather go for quick acquisition of technology
rather than invest in internal R&D. On the other hand, academic institutions and many
of the public research centers focus on advancing the science, focusing on patenting
and publishing, with very little systematic attention being spent in applied R&D.

http://knowledge.wharton.upenn.edu/article.cfm?articleid=1272&specialid=40

Annual Report of DST 2010-11

Industry-academia collaborations play an important role in mechanism for initiating

technological or knowledge spillovers i.e., such information sharing results in
technological improvement. It also results in increased patenting, licensing and also
spin-out firms.
This paper aims to provide an overview of the need for applied R&D in India, and its
potential to enable India to continue its growth trajectory and to enhance India's global
stature. Ironically, academy industry linkages can serve as the best way to realize this
true potential. The paper identifies the most significant challenges in promoting such
R&D, and presents a way forward for action by the industry, policy makers, and
businesses.

Source: India Gate

Universities

IISc

IITs

AICTE

UGC

Ministry of
HRD

Food
Research
Institutes

DRDO
Research
Institutes

Indian
Council
of
Medical
Research

Ministry of
Health &
Welfare

Medical
Research
Institutes

Indian
Council
of
Forestry
Research
&
Development

Ministry of
Environment
& Forest

Planning Commission

DBT
aided
Institutes

DRDO

Ministry
of
Defense

DST
CSIR
DIT
research Research
aided
Institutes Institutes
Institutes

CSIR

DIT

DAE

ISRO

Department
of Space

ICAR

Ministry of
Agriculture

Earth
ICAR
ISRO
Science Institutes
Institutes
Research
Institutes

Ministry of
Earth
Science

Scientific Advisory

Principal Scientific

Ministry of
Communication
&
Information
Technology

DBT DST DSIR

Ministry of
Science &
Technology

PRIME MINISTER

Council of Ministers

INDIAN S&T STRUCTURE

Figure 1: Indian Science and Technology Structure4

DAE
Institutes

Figure 1 shows schematic representation of Indian science and technology (S&T)

organizational structure.

The Figure 2 shows that the number of R&D centers in India and the R&D talent pool
have grown at a CAGR of 30% and 15.7%, respectively, from 2004 to 2010. With the vast
talent pool that India has, we are capable of expanding the R&D activities here, by
multiple folds. But a quick analysis shows that the majority of quality R&D work in India
is being done in the big MNCs for their internal benefit. The rest of the work being
carried out is mostly in the academic background and pertains to fundamental or basic
research that has little or no market value by itself. Overall, India still lags behind many
developed and developing economies (as shown in Figure 3). What India needs badly is
a shift of focus to Applied R&D.

Figure 2: Trend in Growth of R&D Centers and R&D Talent Pool in India5
250000

600
459

200000

479

421

400

173000
152000

260

500

202530
187000

346

150000

498

300

131500

100000
105200

200

84160
50000

100
103

0
2004

2005

2006

2007

2008

2009

2010

Year
R&D Talent Pool

No. of R&D Centers

http://yourstory.in/2011/02/time-for-india-rd-centers-to-maximize-value-from-globalization-says-zinnov/

Figure 3: World of R&D 20106

The size of R&D base in India is assessed to be globally non-competitive. Indian research
is mostly oriented towards basic research and lacks in application oriented R&D.
Recently this scenario is observed to be changing slowly with the advent of foreign
investments in research in India. Foreign money for R&D in India is mostly contributed
by MNCs. The share of R&D facilities located outside home markets of MNCs has been
increasing7. MNCs increased their total R&D sites by 6% of which 83% were in China and
India In 2009, the R&D spending of the 100 biggest Indian companies was about Rs
11,500 Crores. The researches carried out by R&D facilities of MNCs are mostly market
and application oriented8.
According to the draft 12th Five Year Plan, the total R&D spending in India is about 0.9%
of the national GDP of $1,729 Billion (Rs. 78,58,305 crores). As depicted in Figure 4,
three-fourths of this funding was done through the public sector (Rs. 53,044 crores) and
the rest (Rs. 17,681 crores) was from private sector).

Battelle 2011 Global R&D Funding Forecast

Annual Report of DST 2010-11

http://www.business-standard.com/india/storypage.php?autono=340623

Figure 4: R&D Spend Structure in India in 20109

Government Spend
` 53,044
R&D Spend
(` Cr.)

Private Sector Spend

` 17,681

1.1.

Basic vs. Applied R&D

Basic research is the outcome of a scientist's/researcher's curiosity on a scientific

phenomenon. This kind of research is aimed at enhancing scientific knowledge base
about the topic rather than inventing or innovating on a new technology. This generally
has minimum or no market value. But, very importantly, basic research lays the
foundation for the applied science that follows. Applied research, as explained earlier, is
designed to solve practical problems of the world, rather than to acquire knowledge for
the knowledge's sake.

Figure 5: Commercial & Industrial Technology Development Cycle

Government
Labs

Universities

Collaborative
Research

Discovery

Entrepreneurs

Gap Assessment

Product
Platform

Products
Corporate
Labs
Development Integration Application

International
Sources

Advanced Research

Sense
&
Locate

Assess

Develop

Breakthrough

Unmet
Needs

Customer
Drivers

Product Cycle
Battelle India 2011

12th Five Year Plane Draft (2)

Figure 5 shows technology development cycle for commercial and industrial

technologies. Advanced research can take place in government labs, universities,
industrial sources, by entrepreneurs, or corporate labs, individually or in collaborative
research models. The next phase of development generally begins in corporate labs.
Technology passes through phases of assessment, development, integration, gap
assessments, and final validation and placement in market. The way to final market
placement also gets inputs from product testing, customer feed-back and subsequent
addressing of unmet needs.

1.2.

Applied R&D and Product Development Process

Scientific or engineering research directed at providing a product, process or solution

for which a potential market is identified, is what is generally termed as Applied R&D.
Applied R&D is conducted to fulfill a need in a particular market segment. It requires an
analysis and understanding of the existing market environment.
Applied R&D works in multiple inter-related stages. It begins with the identification and
definition of a market need. To realize this, a researcher has to be continuously updated
on the market conditions and trends in the field he/she works in. This enables him/her
to find out gaps in technology/product in those markets. Once the gaps are identified,
the researcher enters the next stage of applied R&D which is 'idea generation'.
An idea put forth can be of three types.
1.

A technique/design/process for improvement of an existing product/technology

By improvement of an existing technology, it is meant that the idea formed by
the researcher is directed towards improving a part or whole of an existing
product/technology. This idea might come from the customer directly, or can be
evolved from the detailed analysis of the product/technology under
consideration. In either way, such an idea has a pre-identified market where the
solution can be applied. Example of such an idea can be development of a new
material for a component part that can replace the existing part in a large
machine which would be cheaper, or more efficient with better features, or
both.

2.

An entirely new idea that can replace an existing product/technology

In this case, the idea leads to a product or technology that will replace an
existing one, in its market space. In such a case, the market demand for the
existing product/technology has to be high and the new technology should be
much superior to the existing one in terms of performance and features. The
success of such an idea is the result of a thorough understanding of such a
market and the level of expertise the researcher has for developing such a

technology. Emails are one such technology that has taken over almost the
entire market of post offices where personal and business mails are concerned.
3.

A novel idea for a product/technology that would be applied in a new market

altogether.
Here, the market space does not exist prior to the development of the
technology. The researcher comes up with an idea that would create a new
market space by itself. Such a technology needs a thorough knowledge of the
technical field being addressed and the behavioral patterns of the customer or
market, the researcher is targeting to hit on. Development of iPad by Apple has
defined an entirely new market segment in the telecom sector for tablets that
actually does not replace any existing product.

Once ideas are generated, the third stage of applied R&D involves qualification of ideas.
Ideas generated earlier have to be further evaluated for their potential to deliver a
successful product/technology/solution. This is often done through peer reviews and
expert evaluations. Among many others, the idea evaluation process includes the
following factors:
i.

Novelty
o

The novelty of an idea is evaluated based on extensive literature and

patent analysis of the work that has been published so far, in relation to
the field of research the idea pertains.

ii. Availability and depth of in-house technical expertise available in-house,

that is required for successful development of product/technology
o

A company or university undertaking the applied research and

development project has to ensure that it has all the required talent in
multiple fields that are required for the development of the technology.

Budgetary requirements include estimate of capital investment,

material coast, labor cost, overheads, and other miscellaneous
expenses.

iii. Potential funding sources.

o

Identifying potential funding sources before the kick-off of the actual

research is critical because without a proper flow of funds, a research
cannot be carried out efficiently.

iv. The accessibility of relevant resources in-house or elsewhere.

o

Relevant resources include materials and machinery & equipments that

are required for completion of the project.

v. The total market-size and the demand for such a product/technology.

o

The market size and market demand estimates are crucial to determine
whether the new product/technology, once developed has the
potential to provide an acceptable return on the investment.

vi. The optimum path-to-market for the technology.

o

Path-to-market refers to pre-determining the value chain, potential

margins and potential customers who would eventually benefit from
this research.

Promising ideas after screening go into the next stage of Applied R&D which is
development. As the name suggests, in this stage the development of the idea into
complete product/technology will be carried out through laboratory works and on-field
testing. The developed technology then goes into the commercialization stage where
the product/technology is ultimately made available to the targeted customers/market.

Figure 6: Stages of Product/Technology Development in Applied R&D

Battelle India 2011

10

Figure 6 gives the stages involved in product/technology development in Applied R&D.

Development of new or improved product/technology is generally triggered by
performance, cost, environmental, and legal drivers prevailing in an industry. This begins
the process of defining product/technology requirements. Before commencing on the
actual product development it is necessary to confirm whether there is a demand for
the new product; will the intended customers buy it? At what price? Are there other
competitive products in the market? What would differentiate the new product or
technology? Such information is often collected by means of benchmarking and
customer surveys. The development then passes through stages of concept generation,
concept screening and selection, development of product/technology, definition of
manufacturing process, selection and installation of equipment, validation/optimization
of manufacturing process, and final commercialization of product/technology. All these
stages are complete processes in themselves. These are dependent on many variables
and follow specific plans and stage-gates. The above figure only depicts these simplified
steps and suggests that after successful development of a product, a new cycle of
development of next-generation products/technologies starts.

Figure 7: Stakeholders in New Product/Technology Development

Battelle India 2011

Successful product development requires input from a variety of stakeholders. Figure 7

shows various stakeholders involved in the development of a new product/technology.

11

1.3.

Roles of Academia and Industry in Applied R&D

Industry can seek help from academia in successfully accomplish the

product/technology development process briefly described above. Building good
academia industry linkages is a complex process and involves many stakeholders. The
need to develop this linkage is to build a strong innovation ecosystem in the country
which will result in a win-win situation for both, industry and the universities. In order to
create a win-win situation, it is important to understand the needs of each stakeholder
and the role they need to play.
What is in it for the Academia?
Industry funding is one of the most important criteria for the universities to participate
in the research programs. The funding generated from the research will help build
infrastructure for future development. Industry projects also help professors and
students in the universities to keep up with the practical problems and the latest trends
in the industry. Establishing good connections with the industry also help attract good
quality talent at the University.
What is in it for the Industry?
R&D or technology needs at the Industry arise because of the customer wanting a
solution, or competitors moving aggressively in certain direction or corporate R&D
sensing a need but having limited resources to pursue complex technology
development. Industries also benefit by collaborating with Universities for their
technology needs. Industry gets access to laboratories, expensive instruments and
equipment, scientist and technologist doing state-of-the-art research in a specific area
without spending additional capital and time required to train researchers. This area
could be a non-core, exploratory area of the business for the firm with long term
strategic focus or it could be a chronic problem for which the industry is seeking solution
now. One important advantage for industry to work with universities is to get a fresh
perspective toward the technical problem.

12

Figure 8: Need for Academy - Industry Linkage

Technology Push Drivers

Funding needs

Research in
University Labs

Attract quality
staff and students

Understand latest
Industry Trends

Model of Co-operation

Technology Pull Drivers

Corporate R&D
strategic needs

Market /Customer
need

Competition

Figure 8 shows a schematic of how the academia-industry linkage is established arising

out of their respective needs. The University or R&D institutes try to push their
technology into the market. The drivers for them are their needs for funds, the need to
keep up with the market trends and attract good quality talent at their organization. In
contrast, the industry is looking to pull the technology into the market. The drivers for
the industry are its needs to meet customer or the market demands and to be
competitive in the market place.
As the academia and the industry objectives come together, a model of cooperation
needs to be established to ensure smooth transfer of technologies or know-how. This
model could take various forms depending on the type of cooperation and the type of
industry and research institutes involved. Figure 9 shows various cooperation models
involved such as Research Support, Cooperative Research, Knowledge transfer and
technology transfer10.

10

Role of Universities in the Product Development Process: Strategic Considerations for the
Telecommunication Industry Alok K. Chakrabarti; MIT Industrial Performance Center, 2002

13

Figure 9: Models of Co-operation11

University R&D / Public R&D Institute / Private R&D
Thesis
dissertation

Specific
Research
work

Technology

Research
support

Collaborative
Research

Funds

Contract
Research
Model

Equipment
for Labs

Technology

Project
Report

Knowledge
transfer

Technology
Transfer

Education
programs

Royalty

Internship

Industry

In each form of co-operation, university and industry have a different role to play and it
is important for each organization to understand if they are prepared to be part of what
can be a dynamic environment transformed by global competition, rapid changes in
technology and shorter product life cycles (Chakrabarti, 2002). In order to ensure that
the roles are clear, industry needs to clearly spell out their objectives of collaboration.
For example some industries may be seeking IP as part of the collaboration or would like
to transfer a technology through some license agreements. Some may be strictly looking
for good talent in the form of new graduates or some may be seeking new products to
launch in the market. Depending on these objectives, industries need to partner with
the right university/research institute for a win-win solution. Many times industries get
technology solutions from the suppliers, but those technologies do come at a cost
because the cost structure of an industrial supplier doing research is different than the
university with students as the main workforce. The research solution provided by the
university may come at a cheaper price but also at higher lead time than what industrial
suppliers can provide. So making a decision to choose the right partner and the right
cooperation model is extremely important. The executives at the corporate level can
make this decision but there needs to be a product champion who can work closely with
the university staff to move things at the pace required by the industry.
At the university/research institute level, it is important to understand why an industry
engages with a university for a research project. Industry might find the
multidisciplinary approach facilitated by the university valuable in finding the solution to
a research problem. It is also important to understand if the industry is just looking for a
11

14

Adapted from Chakrabarti, 2002

toolbox solution or a product to deploy in the field. Finally, it is important to

understand if the industry is requiring results at a faster pace and at a professional level
with good project management. Given these expectations universities need to look
within to see if their organizational and their cost structures allow them to perform
research. They can then decide if they need to work with industries alone or participate
in a co-operative research with other firms. Working alone would require them to have
infrastructure such as well equipped laboratories and a well trained staff. If the lab
infrastructure requires huge capital investment, universities can work with industries
using the Research Support model of co-operation to have the industry invest in the
laboratory facility.
In India, only a few academic scientists have been able to leverage their expertise in
establishing a successful spin-off venture. Dr. Vijay Chandru, former full professor at IISc
Bangalore, is now the CEO of Strand Life Sciences. Prof. Ashok Jhunjhunwala founder of
the TeNet network at IIT Madras has been successful in establishing more than 10
telecom companies.

15

Status of Applied R&D in India

Sustainable growth in Indian economy will require ongoing efforts in Applied Research
and Development (AR&D) in the coming years. R&D in India is conducted at various
levels by various entities such as Academic Institutes, Public R&D Institutes, Corporate
R&D, Multinational companies (MNC) and Entrepreneurs. It is necessary to review the
efforts of each type of organization in the AR&D process to determine the best practices
and existing gaps, so that the gaps could be closed by diffusing the best practices
throughout the system. According to some experts most Indian universities were
mandated to do basic research while research institutes were setup with the focus on
applied research. However many universities slacked in their output and the basic
research burden fell on research institutes.

2.1.

Academia

The concept of Industry-Academic partnerships for R&D has traditionally been

associated with the IITs. There are a few academic institutes like The University of Pune
which have set up incubation centers under the Science and Technology Entrepreneurs
Park (STEP) for the creation of technology enterprises. But the concept of AR&D is still in
its nascent stage in India. SINE, Society for Innovation and Entrepreneurship, hosted by
Indian Institute of Technology Bombay- IIT Bombay is an umbrella organization for the
promotion of entrepreneurship at IIT Bombay12. It was set up with financial assistance
from the Department of Science and Technology (DST) of the Government of India in
2004 and incubates 15-17 companies. The incubator is open to IIT-B staff, students and
alumni and partners of IIT-B. According to one report on University-Industry Links in
India, students and faculty members of management school are not actively involved in
the incubation activity13.
Incubatee companies often need several resources such as technical and financial
assistance and review of their business plan is an important aspect of the new
enterprise creation process. They also need assistance for conducting market research
to identify various aspect of their business strategy. Involvement of students and faculty
will help them in their venture. IIT-Kanpur has SIDBI Innovation and Incubation Center
(SIIC) to encourage R&D and entrepreneurial activities. As opposed to SINE at IIT-B,
there is involvement of business school students in this incubation center (Basant and
Chandra). SIIC invites three types of ventures14: Category I involves technology
upgradation of novel ideas by faculty, staff, alumni and students of IIT Kanpur. Category
II involves Technology based Start-up Company promoted by a first generation
entrepreneur interested in R&D partnership with the institute or a company, with the
objective of commercializing the idea and setting up a business enterprise. Finally,

18

12

http://www.sineiitb.org/about.html

13

University-Industry Links and Enterprise Creation in India Some Strategic and Policy Issues; Basant and Chandra

14

http://www.iitk.ac.in/siic/Incubator_p_final.html

Category III involves Technology/ R&D unit of an existing Small and Medium Enterprise
(SME), industry association or an R&D company that is interested to work with IITKanpur. Therefore, SIIC is open to collaborations from a range of partners which will
increase opportunities for cross pollination of ideas and networking to learn from other
entrepreneurs in the incubate circle. However, students and staff members of IIT-K form
the majority of incubatee companies (Basant and Chandra). The reason for lack of
interest from other parties could be attributable to the lack of awareness of this
program beyond the circle of IIT-K or the policies related to Intellectual Property Rights
(IPR) or grant / loan schemes. Further research is needed to find out the exact reason.
Funding for Innovation and Technology Transfer (FITT) at IIT-Delhi has a similar program
to IIT-B and they have the same issue of lack of business school involvement in their
program. IIT-Chennai does not follow the conventional incubation model like the other
IIT's. It solely focuses on the research activities under its Telecommunication and
Computer Networking (TeNeT) Group. Even though enterprise creation is not the
objective of the group, they are able to incubate several companies based on their
external network of IIT-Chennai alumni. Finally, the Center for Innovation, Incubation
and Entrepreneurship (CIIE) at IIM-Ahmedabad works under the belief that knowledge
of business and management is essential for successful technology enterprise creation.
The program designed at CIIE is a much more comprehensive program because apart
from management support, incubatees get help from laboratories, product
development centers and other technology institutions partnering with IIM-A. The
incubatees are chosen from a nationwide business plan competition. While this is a
good process to select and help a few entrepreneurs, it leaves behind a large majority of
those not selected.
Universities primarily disseminate information in the form of published research
reports. However licensing firms wish to restrict this knowledge in the form of
patenting. In the scientific community publications are considered as an
acknowledgement of scientific prowess. Often scientists are not aware of implications of
publishing their research before patenting. Patent filings could significantly delay the
time for publication; likewise premature publication of research may render it unpatentable.
Traditionally the bio-pharma sector has faced a 'Valley of Death' between public-funded,
long-range basic research and industry oriented product development. Despite
enormous resources spent by the government on research and to understand the
mechanism of disease, not much progress has been made in prevention or treatment of
diseases. It was expected that pharmaceutical industry carry out discoveries and cross
the divide. The ecosystem of basic and clinical research has widely diverged. The
analogy of 'Valley of Death' has been used to depict the deep difference in the
understanding of what basic researchers discover in their labs and clinicians
understanding of the patients needs. There is not sufficient communication among the
parties to understand each other's needs.

19

In 2001, National Institute of Health (NIH) in US reported that of the 47 FDA-approved

medicines with greater than US$500 million per year sales in the US, only 4 were
developed with patented technologies for which the government has use or ownership
rights. Some examples of firms forming exclusive agreements with universities are
GlaxoSmithKline (GSK), for example, has formed a collaboration with the Immune
Disease Institute, Boston, USA, aiming to become a world leader in
immunoinflammatory drug discovery; AstraZeneca is working with Columbia University
Medical Center, New York, USA, to develop novel therapeutics for diabetes and obesity;
and Pfizer aims to advance drug discovery across many therapeutic areas with the
University of California in San Francisco (UCSF), USA15.
The vast gap between state of the art and apt utilization of technological resources in
India stems from lack of IP awareness and poor management. Technology management
and Intellectual Property management are essential for the growth of R&D sector in
India. Academic institutions all over India have identified this gap in knowledge and are
currently offering various courses to address this issue. The following table gives a list of
institutes offering technology management and related courses in India:
Sl.
No.
1

Colleges

Dept

Courses

IIT Bombay

SJMSOM

NMIMS

NMIMS

4
5

BITS, Dubai
IIT Delhi

6
7

Karnataka State Open

University, Mysore
Anna University

8
9

IIT KGP
NLSIU

10

ABMSPs
Yashwantrao Chavan
Law College
PES Modern Law
College
NALSAR

Mukesh Patel School of

Technology Management
and Engineering
Institute of Intellectual
Property Studies
(Weekend Programmes)
Management
Dept of Management
Studies
Distance Education
Course
Distance Education
Course
Rajiv Gandhi School of IPL
Distance Education
Course
Not Mentioned

Master of Management with

Technology Management as
elective
Dual Degree B. Tech and MBA
(Tech)

11
12

15

20

PG Diploma in IPR Management/

Certificate Course in IP/ Diploma in
Patent Law & Practice
3 year part time programme on
Technology Management
PG Diploma in Intellectual Property
Rights and Innovation Management
MBA in Technology Management
LLB - 3 yrs
PG Diploma in IP Law
Dip in Intellectual Property Rights

Not Mentioned

Dip in Intellectual Property Rights

Distance Education
Course

PG Diploma in Patents Law

Pharma pursues novel models for academic collaboration ed. Bethan Hughes Nature Reviews Drug

Discovery 7, 631-632 (August 2008)

2.2.

Public Funded R&D

Shifting the focus from academia to public R&D Institutes, a review of the activities of
Council of Scientific and Industrial Research (CSIR) labs in India suggests that licensing of
patents is the primary focus. According to the 2007-2008 annual report, CSIR published
3858 research papers and filed 256 patents abroad and 207 in India. It has a portfolio of
1246 patents in India and 1770 patents abroad. CSIR has been granted 395 patents in
India and 331 patents abroad with 14 copyrights. CSIR supported around 7000
research fellows, 120 emeritus scientists and more than 800 extra mural research
proposals. Under Dr. Mashelkar, CSIR focused heavily on patenting and CSIR was among
the top 10 institutions among the developing countries for the number of patent
applications a few years ago. CSIR also tied up with several companies to license its
patent in India and abroad. Licensing revenue from patents is the main revenue model
for CSIR. CSIR labs also work with industries for consulting and research projects. Given
the heavy focus on patenting, it seems obvious that there will be more entrepreneurial
activity within the CSIR labs. Interestingly, CSIR has a scheme for scientist to take a leave
for three years and set up or join a start-up company. But there appears to be no
significant growth in that direction.
Indian Institute of Science (IISc), Bangalore is a leading institution in India focusing on
high quality research. Even though, the number of patents filed by IISc is less as
compared to some of the CSIR labs, IISc emphasizes on more industry interaction. It has
formed a Society for Innovation and Development (SID) at the IISc campus which
conducts research projects in close collaboration with the industry. IISc has several R &
D programs with a large number of organizations, such as Nokia, General Motors, and
Honeywell.
The Department of Biotechnology (DBT) has constituted the Biotechnology Industry
Partnership Program (BIPP), which is a government industry partnership for public
support on a cost sharing basis. They are meant to fund breakthrough research and
focused on IP generation in the areas of agriculture, health, bioenergy and green
manufacturing. These were earlier in the form of soft loans to the industry which
discouraged them in taking high risk for such projects. Dr. MK Bhan, the brain child
behind this program, since then has modified these such that industry can apply for up
to 50% for a 'grant-in aid'. Another DBT program, the Biotechnology Industry Research
Assistance Program (BIRAP), is to help strengthen and establish new biotechnology
venture or start-ups in the form of bio-incubators. These are offered in the forms of
loans or grants. These are meant for high-technology start-ups. These programs are for
existing small and medium scale industries and are proposed to encourage emerging
biotech entrepreneurs to enhance industry-academic interactions.

21

Figure 10: Various Funding Options Offered by Ministry of Science and Technology16
Scheme

Funding amount

Target

Purpose

Department of
Biotechnology
(DBT)

Small Business
Innovation Business
Research Initiative
(SBIRI) Phase 1

Upto ` 1 Crore,
upto ` 50 Lakh as
grant and rest as
soft loan

Biotech Companies
/ Entrepreneurs

Early Stage Funding for

high risk, innovative
ideas/products for
commercialization

Department of
Biotechnology
(DBT)

Small Business
Innovation Business
Research Initiative
(SBIRI) Phase 2

Soft loan up to ` 10
Crores

Biotech Companies
/ Entrepreneurs

Early Stage Funding for

high risk, innovative
ideas/products for
commercialization

Department of
Biotechnology
(DBT)

Biotechnology
Industry
Partnership
Program (BIPP)

In ` Crores, mainly
for larger projects.
Grant, Cost sharing
and soft loans
depending on
partnership mode

Small, Medium and

large companies
involved in R&D

Scheme caters to high risk,

transformational
technology / process
development

Department of
Scientific &
Industrial
Research (DSIR)

Technology
Development and
Demonstration
Program (TDDP)

Grants / Loans,
subject to
maximum of ` 250
Lakhs

Start-ups
possessing
protected /
licensed IP

Funds for accelerated

product development in 912 months for faster
market entry.

Council of
Scientific &
Industrial
Research (CSIR)

New Millennium
Indian Technology
Leadership
Initiative (NMITLI)

Grants for Public

Institutions and
Soft Loan for
Private Sector
Companies. Few
crores for 2 years

Small, Medium and

large companies
involved in R&D
and Public
Institutions

Funds for scientific projects

where markets and
technology risks are high.

Organization

Figure 11. Modes of financial assistance provided by TDB from 1997 to 201017
1821.82

Number of Agreements
Sanctioned by the Board (` Cr.)
Total cost (` Cr.)

805.21
691.71
515.17
255.8

244.65
115

Public Ltd.
Companies

17

22

89

Private Ltd.
Companies

5 34.7

81.81

Public / Joint Sector

undertakings

Website of Technology Development Board (TDB)

1.7 11.6

Co-operatives

23
Other Agencies

Figure 11 shows modes of financial assistance rendered by the Technology Development

Board (TDB) of Department of Science and Technology (DST) from the year of
incorporation to 2010. It is seen that Public Ltd. companies received much more
assistance for research as compared to Private companies, Joint Sector Undertakings, or
Co-operatives.
The Department of Scientific and Industrial Research (DSIR) mandate is to carry out
activities relating to indigenous technology promotion, development, utilization and
transfer. The Department is also responsible for coordination of the activities of the
Council of Scientific and Industrial Research (CSIR) and National Research Development
Corporation (NRDC) and Central Electronic Limited (CEL). The NRDC is responsible for
providing consulting service to academic and industry for protection of their IPR and
transfer of technologies. Its function is to support and facilitate effective industryacademia collaborations and commercialization.
Only a few public research institutions have functional technology
transfer/commercialization offices (TTO/TCO). Traditional networking amongst scientist
and firms has been through personal networks on project basis or individual
consultations rather than firm-university/institution collaborations on multiple projects.
The role of the technology transfer office is as a mediating link between the technology
innovator and commercial partner. Technology transfer or commercialization involves
transferring of knowledge, technology and or manufacturing methods amongst
university or research institution. The mechanism of technology transfer of research
involves consultancy, outright sale, licensing, joint-ventures or a start-up venture. This
can result in additional revenue for universities, create new employment opportunities,
attract additional R&D funds, and knowledge spillovers.
No formal legislation for establishing a TTO has been implemented in India. However a
few universities and institutions have independently established offices to interact with
industry. For example: the Foundation for Innovation and Technology Transfer (FITT) has
been established on the campus of IIT Delhi with funds from Ministry of Human
Resource Development. Income can be derived by FITT from services it provides such as
consultancy or other business services.
The Society for Technology Management (STEM) is a professional technology transfer
society for institutions as well as individual members.

2.3.

Patenting Trends

The total number of applications for patents filed in 2009-10 (Figure 12) was 34,287
compared to 36,812 in the previous year representing a decrease of about 6.8% in the
filing. The number of applications filed by the Indian applicants was 7044 which is an
increase over the previous year where 6161 applications were filed. During the year,
Ranbaxy Laboratories was the top among Indian applicants in pharmaceuticals (37)

23

Figure 12: Patent Application Trend in India18

domestic

36000
33000

total

30000

36812

35218

foreign

36312

28940

30651
29178

27000

24505

27243

24000

24430

21000
17466

18000
15000
12000

8503

10592

11466

9000
6000
3000

2206

6324
2179

2371

2693

13836
9395

8773

8221

4824

12613

19984

3218

3630

4521

5314

6040

6161

7044

2618

19
99
/2
00
0
20
00
/2
00
1
20
01
/2
00
2
20
02
/2
00
3
20
03
/2
00
4
20
04
/2
00
5
20
05
/2
00
6
20
06
/2
00
7
20
07
/2
00
8
20
08
/2
00
9
20
09
/2
01
0

(Source: IPIndia annual reports)

closely followed by Wockhardt (33) and Cipla (21). In the field of Information
Technology, Infosys Technologies Ltd. filed maximum applications (23) followed by LG
Soft India Pvt. Ltd. (7) and Center for Development of Advanced Computing (6). In case
of Scientific Research and Development Organisations, Council of Scientific and
Industrial Research filed the maximum number of applications (162) followed by
Defence Research and Development Organisation (80) and Indian Council for
Agricultural Research (55). Amongst Indian universities and institutions, Indian Institute
of Technology filed the maximum number of applications (109), followed by Amity
University (81) and Indian Institute of Sciences (45).
During the year, foreign resident applications filed in India were 27,243 which is a
decrease of 11.12% as compared to the previous year. The maximum filing was by
Qualcomm Incorporation (852) followed by Koninklijke Phillips Electronics N.V. (725) and
Sony Corporation (296).

18

24

http://www.epo.org/searching/asian/india/facts-figures.html

Figure 13: Types of IP Applications in India19

130172 141943
123514
94120

92251

78996

85699 103419

84275 90236

120000
66378

100000
80000
60000

8503

36812

35218

24505 28940

34287

4821
2874

3207

3350

trade marks
patents

10592

40000
20000

11466 12613 17466

3124

3357

4017

4949

5521

6402

6557

6092

designs

0
1999- 2000- 2001- 2002- 2003- 2004- 2005- 2006- 2007- 2008- 20092000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
(source: IPIndia annual reports)

Figure 13 shows increase in applications for different forms of IP in India. There is

significant difference in the number of patents filed to that of trademarks in any given
year which indicates inclination of Indian industries towards protection and creation of
brand value over research and development.

Figure 14: Foreign Applications in India in 2009-201020

10000
9154

8000

6000

4000
3111

3040

1579

2000

1394

1316
972

788

745

560

557

502

470

332

295

307

302

302

162

161

US

A
G
er
m
an
y
J
Sw apa
n
itz
er
la
n
Th
Fr d
e
N e a nc
e
th
et
la
nd
s
UK
Ko
re
Sw a
ed
en
Ita
ly
Ch
in
Fi a
nl
an
Ca d
na
De da
nm
a
Au rk
st
ra
l
Be i a
lg
iu
m
Is
ra
e
Ta l
iw
an
Au
st
ria
Sp
ai
n

(Source: IPIndia annual reports)

Figure 14 shows the total of ordinary applications, conventional applications and PCT
national phase applications filed by foreign applicants in India in the year 2009-10. The
list is topped by USA (9154) followed by Germany (3111) and Japan (3040).
20

25

http://www.epo.org/searching/asian/india/facts-figures.html

Figure 15. Trend of International Applications from India21

Individual

Legal Entity

Total
887
752

707
534
655

482

521

538
352

390

130
2005-2006

144
2006-2007

169

2007-2008

232

2008-2009

231

2009-2010

During the year 2009-10, the total number of international applications filed by Indian
applicants using PCT system was 752 as compared with 887 in the previous year (Figure
15), which has shown a decrease of approximately 15%. Major contributors for the PCT
international applications during the year 2009-10 were CSIR, Hetero Research
Foundation, Matrix Laboratories Ltd., Lupin Ltd., Tata Steel Ltd., Panacea Biotech Ltd.,
Reliance Life Sciences Ltd., Cadila Healthcare Ltd. Glenmark Generics Ltd., IND-Swift
Laboratories Ltd., etc.

2.4.

Incentives in Applied R&D

Incentive prizes have been shown to spur innovation. Prizes are usually offered for
solving a specific problem or for bridging a specific technological gap. Short term prizes
with low prize amounts can result in incremental innovation while long term prizes with
significant prize money can lead to breakthrough innovations and changes.
A study led by Liam Brunt of the Norwegian School of Economics scrutinized agricultural
inventions in 19th-century Britain and found a link between prizes and subsequent
patents22. Newer forms of incentivizing novel forms of problem solving have been
spurred by both not-for-profit organizations as well as firms to solve long withstanding
problems. Several initiatives along the lines of the X prize Foundation, a charitable group
that rewards innovation with cash, have cropped up. The most famous Ansari X prize in
1996, offered a US$10 million prize to first private-sector group to fly reusable
spacecraft into space. Other examples of prizes as incentives to solve problems are:

26

21

IPIndia Annual Report 2009-10

22

Indian version of Bayh-Dole Act, Vartak R et al., Intellectual asset management, Mar/April 2009, p 62-64

Prize4life is a non-profit organization dedicated to discovery for treatments and

cure for Amyotrophic Lateral Sclerosis (ALS) or Lou Gehrig's disease. It
pioneered the application of the incentive prize model to the biomedical field.
Prize4Life launched prizes worth US$1 million. In 2006 the foundation organized
a conference and invited top academic researchers and high-level executives
from the biopharma industry in order to understand the major obstacles in
developing a news drugs for ALS. In Feb 2011, the Path4life announced their
first prize of $1 million to Dr. Seward Rutkove for developing a tool to track the
progression of the disease. Prize4life has also been working very closely with
the Alzheimer Research Forum (Alzforum), a web-based resource for
Alzheimer's disease researchers, to build a similar tool for ALS researchers.
Prize4Life and Alzforum have worked together to hire a Science Writer who
covers the latest news in ALS research. The collaboration has lead to dramatic
increase in the number of ALS-related stories featured on the Alzforum website.
InnoCentive is a spin-off from the Eli Lilly which offers prizes on behalf of clients
seeking innovative solutions to their engineering and scientific problems. Eli
Lilly frustrated with its inability to solve certain drug synthesis and development
problems used InnoCentive's platform to solve the problem. InnoCentive allows
the companies seeking help to remain anonymous if they wish. It has raised
more than $9 million in venture capital as an independent company.
InnoCentive, which basically maintains a website, makes money by charging
clients annual fees of up to $100,000 to post challenges and manage it.
InnoCentive also earns a percentage of the prize money. By 2008 the company
had awarded about $2.6 million for 200-plus solutions of which most were
solved within 2 to 4 months of a challenge being posted23. More than 50% of
registered solvers come from Russia, India, and China. A survey on some of the
reasons for tackling the InnoCentive challenge cited by the solvers included
prize money; however, most cited the thrill in solving puzzles as their prime
motivation. The survey also deciphered that the more the solvers came from
diverse backgrounds the greater were the chances for solving the challenge.
Recently, in September 2011, video game players using a free puzzle video game 'Foldit'
solved the complex structure, retrovirus enzyme, a protein linked to AIDS in monkeys
within three weeks. This problem had stumped scientists for over a decade. The
scientists challenged the gamers to produce an accurate model of the enzyme. This
could potentially lead to development of future AIDS drug design.
Administrating prizes as incentives poses many challenges. Since no upfront funding is
made, a person may not commit sufficient amount of time and resources to such
endeavors. Sometimes these ideas can never be commercialized because inventor lacks
sufficient incentive to develop it further.

23

27

Science for Masses, John Travis, Science, March 2008, Vol. 319, 1750-1752

2.5.

Models for Applied R&D

There are many models for conducting collaborative R&D between industry and
academia. These models differ based on the value chain and drivers of the industry. A
few examples of such models are discussed below. The drug industry is facing increasing
pressure to lower costs to bring the product to market.
IP Group
IP Group, a group based in London, was founded in 2000. It screens IP from universities
and spins out companies. It has formed long-terms partnerships with ten leading UK
universities and has spun out nearly 63 companies including a few in pharma and
biotech industries. IP Group has exclusive access to deals from partner universities and
also receives a large minority equity stake in company.
Biopontis
Biopontis is another R&D model which uses a network of contract research firms to
develop exclusively licensed IP from eight academic partners. It has been successful in
licensing the technology to three big pharma companies: Johnson and Johnson, Merck
and Pfizer. Biopontis has nonexclusive rights to look at university portfolio and once it
identifies a promising technology, Biopontis applies for a 45-day exclusive period to
make a decision. Biopontis validates early stage technologies with access to professors.
Mirror Venture Fund
Eli Lilly plans to invest $150 million into a 'Mirror Venture Fund' run by independent
venture capitalists. Eli Lilly plans to raise $750 million through three funds that will share
drug development costs and potential benefits with venture capitalists and external
researchers. The company will put up to $50 million into each of three mirror funds
containing up to 20 experimental medicines from different therapeutic areas. Eli Lilly
will provide up to half the experimental drugs to be tested by virtual drug companies
and will have the first right of refusal if the drug proves to be promising. Early this year
Eli Lilly announced that one of its VC partners had in-licensed two productsone from
Eli Lilly, the other from an academic institution.
TechColumbus
TechColumbus is an economic development organization which also acts as an incubator
in Columbus, Ohio and located close to Battelle, the world's largest independent
contract R&D organization and The Ohio State University (OSU), a leading public
research university. Apart from being connected to these renowned organizations,
TechColumbus also brings together a network of Hospitals through OhioHealth, a nonprofit organization and several angel and venture capital investors on a common
platform.

28

Figure 16: Example of Technology Commercialization Model Integrating Resources

from Various Stakeholders
The Ohio State
University
Introductory
Meeting

Assistance
Plan

Evaluation

TechColumbus

Business
Incubation

Product development

Market

Concept
Visualization
Legend: Color coding denotes party with primary
responsibility:

Market
Study

Financed by
OhioHealth

Patentability
Analysis

External Funding

Proof of
Concept Study

Innovator, TechColumbus,
Angel investors, Corporate
Sponsors, Grants

Prototyping

Figure 16 shows the commercialization model followed by OhioHealth by seeking help

from TechColumbus. The idea here is to have closely knit community where access to
resources is just a few blocks away. An entrepreneur with a high tech idea can talk to
professors from that area of expertise at OSU, get market research done from the
students at the Fisher College of Business at OSU, get business plan evaluated through
some investors and get all the incubation, administrative, management and skill
development support through TechColumbus. OSU actively provides manpower support
for evaluation of the idea and business incubation. The activities throughout the project
are financially supported by Ohio Health and the network of TechColumbus.
Science and Technology Park (S&T Park) at the University of Pune
This S&T Park is an excellent example of a technology park located inside a
university campus. It was established as a non-profit organization in 1988
and since then it has been a strong force for technology development. The
key functions of the Park are to manage intellectual property, transfer
technologies, build database of emerging technologies, provide training in
innovation management, and promote industrial partnership with academia
for collaborative research, contract research and joint technology
development. It has commercialized over 70 technologies so far and
operates with a lean workforce of 6-10 full-time employees.

29

Some Indian examples include:

Center for DNA Finger Printing (CDFD) is an autonomous centre under the Department
of Biotechnology (DBT). CDFD was conceptualized as a modern institution
encompassing both basic and applied research in diverse areas of modern biology. It has
established a revenue system based on fee-for-service method. It deals with forensic
DNA Fingerprinting, diagnostics, genome analysis etc which is used to fund its R&D
program. CDFD has been successful in commercializing two of its technologies from lab
scale are now addressing the scale-up issues. The start-up is incubated at ICICI IKP
Knowledge Park. It was recently approached by a large firm to license its technology or
has also offered to help CDFD scale-up. CDFD has also been working on a malaria
vaccine in collaboration with National Institute of Immunology (NII, New Delhi) and
Center for Disease Control (Atlanta, USA), funding for which came from Bill and Melinda
Gates foundation. CDFD also closely works with hospitals, tuberculosis centers both
within the country and aboard to setup National Epidemiological Databank of
Mycobacterium tuberculosis genotypes.
Indian Institute of Chemical Technology (IICT)
IICT was established in 1944 and originally named as the Regional Research Laboratories
(RRL). It worked in the multidisciplinary fields and developed further expertise in the
area of chemical technology. It works in both basic sciences and applied drug discovery
processes. Some of its foreign clients include: Civenti (US), Smith Kline Beecham (UK),
DuPont (US) etc. In any given year it has more than 20 ongoing R&D projects with
foreign firms and about 270 collaborations with Indian firms and 23 government-owned
companies24.
Institute of Microbial Technology (IMTECH), Chandigarh, is recently tied up with
Nostrum pharmaceuticals, New Jersey USA to carry out clinical development and
commercialization of a novel clot busting therapeutic protein. The therapeutic protein a
clot specific streptokinase (CSSK) was developed at IMTECH. Nostrum has obtained
license to develop and commercialize third and fourth generation thrombolytic
molecules. The technology was worth US$ 150 million in milestone payments and
royalties. Since then Nostrum has also in-licensed another compound, Caerulomycin an
immunosuppressant which can help prevent organ transplant rejection and
autoimmune disorders.
Bangalore- Helix Biotech Park is a biotech cluster planned by the Karnataka government
and would provide support with common infrastructure. It will house biotech firms like
Biocon, Astra Zeneca, Strand genomics, Aurigene etc and also educational institutions
like Institute of Bioinformatics and Applied Biotechnology (IBAB).

24

30

Global innovation in emerging economies ed Prasada Reddy, Taylor & Francis, 2010

Translational Centers in India

The Indian government has planned to setup four translational centers in form of The
Translational Health Science and Technology Institute (THSTI) with multidisciplinary
research approach and collaboration with hospitals and firms. In addition 14 knowledge
parks are being planned to cultivate entrepreneurial environment, which facilitates
association with research universities for facilitating collaborative research and
technology transfer
Technovate India in partnership with ministry of science and technology, UK
government and World Bank in partnership with i2India Venture is sponsoring this
initiative to encourage development of products which meet basic requirements in
areas of clean technology, healthcare and engineering. Initial funds were limited to Rs 8
crore and additional plans to raise $10 million (Rs 47.3 crore)25. Technovate India plans
to choose a dozen entrepreneurs for incubation, offer monthly stipends, mentorship
and even assist with business plans. The start-ups are eventually expected to source
their own funds to develop the products.
National Chemical Laboratories (NCL) Pune's Venture Centre provides early stage startup funds to technology and knowledge based start-ups companies. Some of the
technologies that NCL has successfully are in the areas of biofuel, surgical instruments,
membrane filters etc.

2.6.

Research and Development Consortia

Research and Development (R&D) consortia formed often with government funding
with the purpose of conducting shared research to develop new technologies. They are
usually not for profit organizations whose memberships include multiple public
institutions, universities and private firms. It involves sharing expenses and resources
and also access to a pool of talent and expertise. Such consortia are usually involved in
Precompetitive collaborations which is an open collaboration between companies that
usually are intellectual property (IP) competitors. 'Pre-competitive research' involves 'a
middle ground of focused cutting-edge research that lies between fundamental basic
research conducted mainly in universities domain and proprietary research performed
in corporate laboratories'. Varied situations such as international competition, exploit
complementary assets, reduced costs and time for product development. Challenges in
successfully managing consortia involve IP management (ownership and licensing),
transparency and clear understanding of the contract agreements, conflict of interest,
and publication policies. A well respected neutral convener is important enabler for
effective collaborations.

25

31

http://www.istockanalyst.com/article/viewiStockNews/articleid/4187623

Sematech R&D Consortium

The US Semi-Conductor Manufacturing consortium (Sematech) was founded in the 1989
in Texas as a cooperative effort by the US government and 14 US based semi-conductor
manufacturers. This was established in response to increasing dominance of the
Japanese semiconductor industry in the 1980s. Microchips were essential for modern
warfare equipment and the US military feared that America's national security was at
risk. Sematech saved the US semiconductor industry from the Japanese competition.
Sematech was funded by the US Department of Defense through an act of legislation for
a total amount of US$ 500 million over 5 years. Such a cooperation was difficult to
manage due to prior issues around secrecy, rivalry and antitrust amongst the firms.
However Sematech was able to overcome the challenges especially with strong
leadership. By 1994 more than half the chips were manufactured by US semi-conductor
firms. The consortium was self sustained and now has more than half the global chip
makers as its members. Sematech was hailed by the Clinton administration as a national
asset which epitomized the appropriate balance between public and private sectors.
Biomarker Consortium
The Biomarker Consortium was established in 2006 as a public-private biomedical precompetitive research collaboration partnership managed by the Foundation of National
Institute o Health (FNIH) and other stakeholders such as US FDA, biotech and
pharmaceutical firms and patient advocacy groups. The goal of the Consortium is to
build collaborations to enhance the development of biomarker-based technologies,
medicines and therapies for the prevention, early detection, diagnosis and treatment of
disease. It aims to promote drug discovery, development and identifying biomarkers
and aims to make the research available to public. The corporate partner of the
consortium include most big pharma firms like Abbott, Eli Lilly, Amgen, AstraZeneca,
Bristol-Meyers Squibb, etc. The non-profit partners include University of Illinois,
American diabetes association, Alzheimer's Association, American Society of Clinical
Oncology, Arthritis Foundation, etc. The therapeutic areas of focus are cancer,
neuroscience, metabolic disorders and inflammation. Within 2 years of start of the
project, the consortium was able to identify 'Adiponectin' as a biomarker for glycemic
index in type 2 diabetic patients26.
Indian Automobile R&D Consortium
A Core-group on Automotive Research (CAR) was formed in 2004 which involves
academia-industry involvement to address barrier in implanting technologies, testing
and validating prototypes and doing basic research. The consortium involves
participation of automotive companies, software firms, high-tech start-ups and
academic partners such as national labs and IITs27. Some of the technologies developed
with such collaborations have resulted in technologies such as Engine Management
26

The Biomarker Consortium: Practice and Pitfalls of Open source Precompetitive collaboration,

Wagner JA et al., May 2010, Clinical Pharmacology and Therapeutics, Vol. 87 (5)
32

27

http://www.tifac.org.in/index.php?option=com_content&view=article&id=68&Itemid=99

System for petrol powered small vehicles with collaboration between IITB, IITM, TVS
motors and Ucal Fuel systems. Another successful endeavor was development of a
vehicle tracking and control system using GPS/GSM technology which was done in
collaboration with IIIT Bangalore, Ashok Leyland, Lattice Bridge, Bharat Electronics and
Pallavan Transport consultancy.

Figure 17: CAR Work Flow Diagram

DHI

Position
Papers

Technology
raodmap

Workshop
Institutional
Linkages

CAR
Ex
Pane pert
ls

Directed
Research
Project

PSAO
DST

CAR
Program
MoRTH Committee

Topic Selection,
Develop
Proposals,
Evaluate &
Recommend.

DIT

PreCompetitive
Consortium
Project

TIFAC

Co
m
Ce peta
ntr nc
es y
IPR

TIFA
C

Oversee Consortia
project implementation

e
otyp
Prot
w
hoge
ow ka
Kn Pac

A similar model, as shown in Figure 18 below, exists in Pune called AutoCluster.

Figure 18: Activities at Auto Cluster in Pune

Market
Support

Quality
Up-gradation

Testing

Engineering

Auto
Cluster
Net

Research &
Development

Training

Rubber Components

33

Certified
Designer

Certified
Trainers

Auto Engineering

Polymer Components

Auto Electronics

CTDUT: Shared Laboratory Model in the Pipeline Sector of Brazil

Independent non-profit founded by Petrobras, the largest oil and gas

company in Brazil; Transpetro, the largest pipeline company;
and,Pontifcia Universidade Catlica do Rio de Janeiro (PUC-Rio), a
University in Brazil

The reason for setting up the shared laboratory model was to tackle the
following challenges

Difficulty in simulating extreme conditions of pipeline in operation.

High construction, operation and maintenance costs that few

companies could afford.

Increasing technological challenges created by the necessity of new

field exploration lead the companies to undertake research and
development activities as a means of keeping the competitiveness
and exhibiting an outstanding market performance.

Today, 45 members of CTDUT, share cost for Research and Development

in the Pipeline industry

CTDUT does not have its own dedicated team of in-house researchers

It acts as a catalyst for both the ones who have, and the ones who need
specialized knowledge in the oil and gas pipeline industry. In such a
model, other laboratories and specialists are not perceived as
'competitors', but as important partners in the initiatives with which
CTDUT may be involved.

Its facilities were built with resources from the Oil and Gas Sector Fund
(CTPetro) which is managed by the Ministry of Science and Technology
(MCT) through the Studies and Projects Financing Agency (FINEP)

Source: http://www.ctdut.org.br/en/blog/imprensa/ctdut-shared-laboratory-model

34

TIFAC and SIDBI Revolving Fund

A collaborative project between TIFAC (Technology Information, Forecasting and
Assessment Council) and SIDBI (Small Industries Development Bank of India) launched
in 2010 plans to fund early stage funding in high-risk innovative technologies in MSMEs
(medium and small sized enterprises). It plans to facilitate, develop and scale-up the
technologies. The funding in the form of loans up to Rs100 lakhs is open to both
academia as well as industry. It is however based on milestones and the project should
not exceed more than 18 months. SIDBI in addition has created a National Venture Fund
to fund software and information technology industry (NFSIT) in addition with Ministry
of Information technology.

2.7.

Open Source Models

Open Innovation a term coined by Henry Chesbrough describes how useful

knowledge and technology was becoming increasingly widespread so that integrating
knowledge from multiple sources would result in new technologies and products. Open
source has been made famous by the Information technology sector. Some of the most
famous are the open source software products such as Linux operating systems and
Apache computer server software. The Human Genome project is the other most
famous program in lifesciences.
Open Source Drug Discovery (OSDD) program established in 2008 is the brainchild of of
Dr. Samir Bhramachari, Director General of CSIR, to discover drugs for neglected
diseases wuch as AIDS, malaria, Tuberculosis etc. A grant of $32 million has been
santicoend for these projected. Under the OSDD the drugs devleoped would
immediately become generic and no IP or patents would be generated for them. Its a
public private initiative which includes TCG Lifessciences, Sun Microsystems, Institute of
Gnoemics and Itnergrative Biology, Sky Quest Labs etc. It plans to utlize hundereds of
college graduates to annotate genome sequences under trhe guidance of senior
investigators. Genome sequences of the disease causing organisms would be then put
them in open source for researchers to design potential drug targets.
However recently the Tuberculosis causing Mycobaterium tuberculosis sequencing
program has faced some criticisim for utlizing college gradautes and the validiity of the
sequences. An external validation both experimentally and computantionally is
required for such programs. The program is India centric hence additional global
patnership will provide additional direction as well as inputs to pace this novel open
source program.

35

2.8.

Proposed Actions in the 12th Five Year Plan

The Government has emphasized the need for an increase in the Science & Technology
(S&T) activities in India. For this, the government has put forth certain steps that need
to be accomplished in the next five years, through the 12th Five Year Plan.
i.

Aligning S&T to Developmental Needs

In India, a wide range of sectors need breakthrough innovations and significant
S&T inputs. There is a substantial need for resources for creating a strong R&D
system. The plan aims at increasing the R&D spend of 0.9% of GDP, of which 75%
is public sector and 25% is private sector spend, to 2% of GDP which will consist of
50% each of public and private sector R&D spend. The plan also aims at proposing
a shift in the R&D system in the country from basic research (input driven model)
to applied research (output driven development strategy).

ii.

Interaction of Public S&T Institutions with Industry

The 12th Plan aims at bringing in changes in the way publicly owned S&T
establishments communicate with the industry. Leveraging the government
grants and other forms of financing to secure private financial flows is one of the
actions the government intends to take. The government also aims at developing
a workable protocol for facilitating interaction among these players. Large Indian
companies may be encouraged to establish R&D centers like those of MNCs such
as GE, Motorola, Texas Instruments etc.

iii.

Research in Strategic Sectors

The government aims at increasing the R&D activity in the three main sectors
namely Department of Atomic Energy, Department of Space, and Department of
Defense Research and Development. Their research needs could trigger unique
mechanisms for encouraging innovation and ensuring the right impact on social,
industrial and strategic sectors in the 12th Plan.
In order to facilitate this, special directorates have been setup at the headquarters
of the Departments to serve as clearing house of the relevant information on
technologies. Linkage with the industry associations is another dimension which
would need additional thrust in the 12th plan.

iv.

National Missions
National missions stress on addressing the national needs. National needs are
mainly related to agricultural needs (soil management, water management,
genetic erosion etc.) and resource management (energy conservation, efficiency,
renewable energy, etc.).

36

v.

Dialogue with Other Countries

To establish constructive communications with other countries (both developed
and developing), the government aims at creating a framework that would
mediate between the countries and their organizations. This would take into
account the realities of strategic national interest and diplomatic charter.

vi.

Expansion of Basic Science

The 12th Plan further aims at improving the basic science knowledge base in
Indian institutions; mainly universities and IITs. Basic science teaching and basic
science research is a prior condition for the expansion of the scope of S&T
intervention in the development of the economy and society.

2.9.

Discussion

The Indian government is increasingly emphasizing the need for conducting science to
address needs of society and industry. Enhancing scientific base alone is not sufficient to
address societal and industrial needs; the science has to be converted to products and
technologies usable by customers. Innovation is the key driver to the economic growth
of the country. However the ecosystem linking the public research institutions, firms
and the government is proving to be quite diffused. The knowledge networks linking the
flow of information from these institutions are extremely weak and tend to work in their
own silos. Traditionally public research institutions (PRI) have always performed
upstream, basic research while corporate researchers have done applied or downstream
research. Given the huge investment in PRI in the form of government supported
research, and financial need of the industry constantly compete for newer technologies,
there is huge potential for the industry to tap into research conducted at the PRI and
universities. In pharmaceutical companies, the cost of internal R&D has increased
significantly and newer collaborative models have replaced the traditional fully
integrated R&D models.
Basic scientists work in their own silos and do not understand how to translate basic
science into products and technologies that address the market needs; they also are not
adept in adopting new technologies with time. Most scientists are motivated to conduct
basic science and very few find potential applications for their inventions. Industry
needs are very dynamic and need to innovate at a fast pace to beat the competition.
Therefore it is necessary to align academic research efforts with the commercial needs
of the market.
The academia-industry linkage must also address scalability issues. The laboratory scale
research conducted at universities needs to be scaled up to be adopted by industry.
Research solutions from academia are seldom in a finished form and much work needs
to be done by the receiving industry to implement them. Once the students engaged in

37

conducting the research graduate, it becomes difficult to get any further improvement
on the research solution.
The size of firms can also play a critical role in forming industry-academia linkages. Large
firms may already have entrenched capital investments in its own versions of the
technologies and are less likely to switch to newer manufacturing if it requires
significant new capital investment and change in its existing processes. While small and
medium sized firms which need a new technology and maybe flexible in developing the
technology in consultation with the scientist. However smaller firms may not have the
capability to fully develop the technology on their own, hence mostly look for a finished
product.
Review of Indian academic and public research institutes suggest that the Applied R&D
concept is still in its infancy in India. Several IIT's and IIM's have incubation models for
creation of technology enterprises in India. Some are based on conventional incubation
models trying to push technology out of their institution and some like IIM-Ahmedabad
are more comprehensive, inviting participants from all over the country for a business
plan competition and providing technical, financial and management support for their
entrepreneurial activity. Public research institutes like CSIR are focusing on licensing on
patents and IISc have been very selective in their patent applications but have
established some good industry connections.
A World Bank study estimated that by the end of 2007, there were about 370 R&D units
set up by MNCs (World Bank 2008). MNC's are taking advantages of the availability of a
large pool of talented scientists and engineers, existence of well-known universities and
national research institutes, a large domestic market and substantially lower wages of
research personnel compared to the industrialized countries. Even though many large
Indian companies have started investing in R&D, there is a trade off because companies
have to allocate resources to deliver products to the growing economy28. A recent
survey by the consulting company McKinsey about R&D strategies in emerging
economies, such as China, India and Brazil, shows some interesting findings about the
allocation of R&D spending of private companies. Figure 19, adapted from a McKinsey
report, shows some details. It is observed that there is more focus on in-house R&D
(59%) followed by collaborative R&D with suppliers (18%) and then followed by
academic partnership (13%)29. Similarly, a look at the project partners from India for the
European commission Seventh Framework program (FP-7) suggests very little industry
participation in Research projects. European commission encourages industry
participation in such programs and many European SME and large industries actively
participate in these programs30.

28

http://web.idrc.ca/openebooks/504-5/#page_108
https://www.mckinseyquarterly.com/RD_strategies_in_emerging_economies_McKinsey_Global_
Survey_results_2787
30
http://www.euinec.org/files/EUINDIAProjects.pdf
29

38

Figure 19: Graph showing focus on In-house R&D

in emerging economies like India, China and Brazil
70
60
50
40
30
20
10
0

In-house R&D Collaborative University and

Other
R&D with
academic
collaborative
suppliers
partnerships
R&D

39

R&D that is
fully
outsourced

Challenges
The logic for applied R&D or the academic industry linkages is very clear. Yet,
consistently empirical studies point to the lack of focus in this area. As outlined in the
earlier section, there are significant success stories. Yet, they are far from the true
potential that India can and should achieve. A systematic study of the R&D
management issues suggests seven major challenges, listed below:
(1) Lack of an appropriate mindset;
(2) Insufficient resource base;
(3) Lack of Intellectual Property Infrastructure;
(4) Lack of Commercialization capabilities;
(5) Lack of Incentives;
(6) Absence of Collaboration across companies;
(7) Absence of Regulatory framework for academy-industry collaboration
research

3.1.

Mindset

Research demands curiosity, and curiosity has its own problem of distracting away from
the goal. Creativity demands a high level of autonomy, and often autonomy has its own
downsides. Often organizations and individuals do not get into R&D, because their
mental models are bent on thinking in structured ways. Research often distracts from
day to day work, and for a nave executive, may seem like a drain on the resources in the
short term. The uncertainty associated with research outcomes makes it even harder to
invest long term. R&D requires a mindset that incorporates at least four elements: (a)
The willingness to invest in risky projects to resolve perceived problems, (b) the
persistency to build capabilities that are demanded for research, (c) the tenacity to stay
on course in the midst of failures and obstacles, and (d) a capability to manage the
process in a systematic way.
The academia and the industry both have their own share of problems that prevent
them coming together. The academic is locked into the world of publishing or patenting,

42

and often does not go out of his/her way to think about commercialization. The
business executive, on the other hand, is driven by the production targets for the
quarter, and is unable to invest the time needed to focus on R&D. Building in-house R&D
requires significant investment from the top management. Even when management is
willing to invest, how do we create the mindset needed for this remains a formidable
challenge?

3.2.

Lack of Resources

If Chilean investors invest in my company, I'll not come back to India," says Nithya Dayal
from SupportBee, a customer support software company. This statement appeared in
an article in Economic Times recently talking about the helping hand provided by
Chilean Government to entrepreneurs around the world through its Start-up Chile
program. Such are the sentiments of Indian entrepreneurs looking to commercialize
their products in the Indian market. Innovators are spending a lot of time and energy in
overcoming the bureaucratic and infrastructural challenges in India. Innovators are also
operating in silos and not getting enough opportunities for cross pollination of ideas and
networking to learn from other entrepreneurs. The Start-up Chile program is providing
just that and much more to entrepreneurs around the world.
India has always been facing the issue of brain drain since the past few decades where
Indian students go to developed economies like United States for higher studies and
never return back. But the above statement highlights a new trend, even though not as
prominent as the earlier one, entrepreneurs migrating to other emerging economies for
better business prospects. So what are other countries providing that India is not? India
has several public institutions under the Council of Scientific and Industrial Research,
Indian Council of Agricultural Research and Indian Council of Medical Research to boast
about the research capabilities. But the missing link in this research chain has been the
focus on commercialization of research and meeting the market needs. Technology
commercialization is a very complex process which begins with discovery of an idea or a
concept and going through the entire phase of product development, intellectual
property development, business concept development, market feasibility, business plan
development and finally technology licensing, acquisition, or spin off into a start-up
company. The point to highlight here is that most public R&D Institutes or university
R&D labs in India lack the resources or the incentive to do the market research to take
the technology from the lab to the market. Recently, a study published by Indian School
of Business and Ivey School of Business highlights several commercialization challenges
at the Center for Cellular and Molecular Biology. These challenges are presented from
the scientist or the public R&D Institute's point of view. But the challenges overall for
new technology generation remain the same. Some of the challenges are:

43

1. Lack of business exposure for the scientist to assess the commercial

potential of their idea.
2. Lack of technical sophistication by a licensor to understand the core
scientific idea.
3. Fear of getting the idea stolen by a commercial enterprise.
4. Lack of risk taking ability of the Indian companies to invest in early stage
research.
5. Poor incentives for scientists for commercialization. Focus is on publishing
papers than filing patents.
6. Lack of people with a good blend of technical and business skills (preferably
PhD with a MBA) to look at both sides of the coin.
The challenges described in 1, 2 and 6 require an ability to connect the dots between
the technology and the market. This is a skill that comes with experience, but also could
be honed by some planned learning process. Several IIT's and IIM's have now
technology development programs and also serve as incubators for promoting
technology entrepreneurs. Some of the examples are Society for Innovation and
Entrepreneurship (SINE) at IIT-Bombay, SIDBI Innovation and Incubation Center (SIIC) at
IIT-Kanpur and Center for Innovation Incubation and Entrepreneurship at IIMAhmedabad. But real technology problems have to deal with interdisciplinary topics
which require different departments at a University to come together and provide
solution. Every department has their internal objectives to meet and internal resource
allocation to take care of before working with other departments. This typical happens
because the departments operate in silos. Also problem solving requires continuous
dialogue between the researcher and the industry managers. There are several resource
based challenges for a continuous dialogue process. Academia has to make an extra
effort to be at speed with the industry requirements. Project management skills are
essential for efficient delivery of a project within the required time and assigned
budget. Budget may not be a big deal for academia because students are their key
resource and are available cheaply. But time management is the biggest hurdle for such
projects because university professors are often tied up with other day to day
responsibilities of teaching, administrative work and publishing papers. There are also
other resources that are lacking such as formal technology transfer offices at the
University with people with the know-how of technology licensing and Intellectual
Property (IP) knowledge. Many times university research is based on basic research
where there is dearth of funding or sometimes the research may not have a good path
to market, at least based on the knowledge of the researchers. One good example was

44

discussed in the May 2003 issue of the Business World Magazine. Due to the lack of
knowledge of the researcher at IISc about the potential application of his technology,
valuable patent filing in the field of carbon nanotubes was missed and instead the
research was presented in a conference. Had the researcher discussed his findings with
the IP experts at the technology transfer office, this potential mistake could have been
avoided and IISc could have claimed royalty for a highly valuable technology.
Another case involved a Ph.D. student at an IIT. The student developed a novel process
for synthesizing thermally reversible polymers. The professor applied for only an Indian
patent and did not consider applying for a worldwide patent because of lack of
understanding of how and when to file a worldwide patent, lack of funds, and interest in
getting a publication in a refereed technical journal. Another opportunity Lost!

Example of Current Challenges in a Public Private R&D Project

A public university was in talks with a paper company for a research oriented
solution to the company's problems. The Professors at the University had a
part of the solution and were planning to involve a couple of PhD students to
work on that for 2-3 years. The professor was interested in creating a few
publications and graduating the PHD students. For the rest of the solution
they required help and asked Battelle India, a private contract R&D
organization, for assistance. Battelle India agreed to help and prepared a 9month timeline to develop a solution. The short timeline was not suitable
for graduating PhD students. But working with PhD students for 3 years was
not feasible for Battelle India as well as the paper company since the
company needed a quick solution. Because of conflicting motivations, it was
not feasible set up the three way partnership among
Universities face resource or incentive related challenges when working with
industries and according to the above example, a need for a private applied
R&D institute to expedite the pace of development is necessary.

3.3.

Challenges in Intellectual Property Generation

Intellectual Property (IP) is a type of intangible property and law gives exclusive rights to
the owner over such intangible assets. Common types of intellectual property are
copyrights, trademarks, patents, designs, geographical indications, etc.
The 1970s Patent act abolished the product patent and permitted process patents only
for five to seven years. This was set with the objective to promote indigenous

45

pharmaceutical industry and provide the Indian consumer with affordable drugs. This
encouraged local drug firms to copy patented drugs made by foreign companies by
unique manufacturing processes. Many experts believe that this acted as a deterrent to
innovation in the pharma sector. Due to the reduced profitability and risk of losing
proprietary technology many foreign firms opted out of India in the 1970s. In 1995 India
entered the World Trade Organization and signed the Trade-Related Aspects of
Intellectual Property Rights (TRIPS) treaty which brought back the patent regime. This
required India to grant product patent to all new chemical entities (NCEs).
Applied research is market oriented in nature and hence has immense scope of IP
generation. Sadly in India today Applied R&D is faced with many challenges which
hinder IP generation. Some of these challenges are elucidated below.
1. Lack of Applied Research
Research institutions in India mostly focus on fundamental research and not
on applied research. In many cases, the researchers do not realize the value
of IP generation.
Faculty members are expected to perform multiple tasks of teaching,
research and research supervision, interface with industry and (in many
cases) shoulder administrative responsibilities. It might, therefore, be rather
difficult for them to define their priorities to meet diverse institutional
obligations31.
Faculties in universities and other institutions tend to be more inclined to
publishing papers and articles in internationally renowned journals and
other publications so that they can build their credentials based on the
number of publications and citations in their names. Filing patents is a very
tedious process for them due to the complications in novelty analysis,
drafting, filing, and fees associated with filing and maintenance of the
relevant patent. Most of the universities do not have infrastructure for
providing patent filing assistance as those in the Indian Institutes of
Technology (IITs) and Indian Institute of Science (IISc) where there are
dedicated Patent Cells to help and encourage faculty to file patents in their
respective areas.
Recently, many of the scientific developments are directed towards the
market characteristics of the intended technology. A market is defined by a
need/want/demand which may be either evident or hidden. The
need/want/demand is dependent on the political, social, economical,
cultural, and environmental factors. For example, research activity in energy
sector has been escalating over the last two decades. Research in
31

46

http://www.icrier.org/pdf/Working%20Paper%20247.pdf

renewable energy contributes to around 40% of the R&D activity in the

Energy sector. This is in response to the market forces like depleting
resources, global warming, political and economic issues, etc. But for a
university, research with a market potential has little or no significance.
They are not looking for a technology that will sell in the market, but one
that would give him/her an edge over the existing technology landscape.
This tends to direct their research towards basic or fundamental aspects of
a technological field rather than application-oriented research or industrial
research unless the project is sponsored by an industrial partner.
2. Improper Channelization of Funds
In India, R&D fund distribution shows more focus on fundamental research
rather than applied research. Scientific research requires infrastructure,
equipment and supplies. While the university may be in a position to
provide basic research infrastructure, project specific requirements may
involve huge expenditure that must be sponsored by a funding agency,
including government departments, research foundations or private bodies.
Government organizations like DST, DBT, MNRE, and DIT allot funds for
projects in different areas like energy, water, biotechnology, information
technology, etc. depending on the government policies and procedures.
They float calls for proposals for these areas and interested parties with
promising ideas are granted funds. The channelization of these funds is not
direct from the Department to the Institute/University. Funds allocated
goes through a series of filters and elaborate procedures to finally reach the
Institute/University. The money is released intermittently over the period of
the project. A lot of time and energy is used up in just channelizing and
managing these funds.

Figure 20: R&D Project Cost Break-up of DST in 2010-1132

32

47

Annual Report of DST 2010-11

Figure 21: R&D Projects Sanctioned During 2010-11 by DST33

Figures 20 and 21 show the break-up of R&D projects sanctioned and

corresponding cost to DST in different fields of research in the year 2010-11.
The charts depict the nature of research activity in India. The figures
indicate that there was higher research activity in the Life Sciences field
followed by chemical sciences. There was minimum research activity in
Mathematical Sciences.
Most private companies that have R&D facilities use them for their own
internal projects. They are generally not open to float funds outside the
organization nor are they very much interested in collaborative projects.
Private companies prefer maintaining their trade secrets or exclusive rights
to their technology and hence do not favor giving out projects to
universities/institutes where they suspect leakage proprietary knowledge.
3. Lack of Industrial Experience
In general, many of the faculties lack industry experience. Most of them
directly take up jobs in Universities/Institutes after their graduation and
hence they tend to oversee the importance of the market value of a
developed technology. Industry experience may influence patenting activity
of faculty in a positive way, as they would better appreciate how
rudimentary inventive ideas generated from academic research can be
developed for commercial applications through IPR protection34.

48

33

Annual Report of DST 2010-11

34

http://www.icrier.org/pdf/Working%20Paper%20247.pdf

4. Lack of Technology Transfer Mediators Between Academia and Industry

The relationship between the academia and industry should be of
interactive, collaborative and participative nature, realizing and respecting
each other's role and contribution. Creation of new interface structures
such as consortia, partnership research institutions, etc. for basic and
applied R&D will help strengthen the interface between academia and
industry and tap the Public Private Partnership (PPP) effectively. Such
organizations will enhance the mobility of S&T professionals and promotion
of technology transfer and new venture creation.
While government participation could be in the form grant-in-aid to
academia and/or conditional grant to innovative small companies, industry
partners will bring with them inputs like domain knowledge, market
research and facilities for testing and validation of prototypes. Active
programs may be established for regular visits of experts from industry to
address students, academic and scientific staff. Efforts are also needed to
strengthen venture funding for an effective proliferation of knowledge
based entrepreneurship.
5. Reinventing
Due to improper understanding and lack of resources, there is a lot of
reinventing activity in Indian research institutions. Before conducting a
scientific research, it is essential that a researcher much do a thorough
while-space analysis of the technology under study. This analysis of
previous publications and patents in the technological field will enable to
researcher to channel the research through the most feasible route. In
many cases, there is a lack of prior art search of the technological field to
verify the novelty of the idea where the person is intending to conduct
research, which in turn results in reinventions.
6. Lack of awareness about IP and its value
Indian academia is still largely publication driven and hence it may be
reasonable to assume that faculty in India will try to publish all academic
research output. However, only a subset of this research is patentable. To
the extent that publication acts as a proxy for the entire volume of research
being conducted by a faculty member, it will directly affect the rate of
patentable inventions. However, it could also be argued that if there is an
inherent conflict between publishing and patenting, a larger pool of
publications might imply fewer patents.

49

Motivation behind research publications and patenting ranges from

motivations like career advancement or peer recognition, but seldom
collate with commercialization of technology. Due to the complexity in filing
and maintenance of patents, many a time, researchers prefer publishing
their work in renowned journals rather than applying for patents.

3.4.

Challenges in Commercialization

The technology transfer offices act as an 'intermediary' in transfer of a technology from

the academic scientists to firms. They also aim in finding potential partners; however,
they commonly face the following challenges:
The technology transfer officer does not have the relevant expertise in
evaluating the business viability and marketability of the technology. The
technology transfer officers typically have a science background and may
not understand the business nuances.
Scientist's focus may diverge from core focus of his research, especially the
untenured faculty who needs to publish in order to get his tenure.
Publications compared to patenting are considered recognition of scientific
prowess by fellow scientists.
Less control over the future of the invention once it is licensed to a firm.
The scientist may not be allowed to publish additional papers and thus be
constrained from advancing science and interacting with other researchers
in that field.
Some of the challenges faced by most incubation centers at research institutions are
that they are usually not functional and have been known to provide only physical lab
space.

3.5.

Challenges in R&D Consortia

Research and Development consortia are often formed with government funding with
the purpose of conducting shared research to develop new technologies. They are
usually not for profit organizations whose memberships include multiple public
institutions, universities and private firms. It involves sharing expenses and resources
and also access to a pool of talent and expertise. Such consortia are usually involved in
Precompetitive collaborations which is an open collaboration between companies that
usually are intellectual property (IP) competitors. 'Pre-competitive research' involves 'a
middle ground of focused cutting-edge research that lies between fundamental basic

50

research conducted mainly in universities domain and proprietary research performed

in corporate laboratories'. Varied situations such as international competition, exploit
complementary assets, reduced costs and time for product development. Challenges in
successfully managing consortia involve IP management (ownership and licensing),
transparency and clear understanding of the contract agreements, conflict of interest,
and publication policies. A well respected neutral convener is an important enabler for
effective collaborations. Other challenges include:
Ownership of IP
Managing multiple party alliances
Need for common converging interests of members, especially an urgent
drive to solve long standing issues
Pre-existing alliance or mutual dependency to seek common goals
Is it an open or closed membership who can join in? Is it open to all and/or
on a fee basis?
How active are the members, commitment of resources?
Funding issues government and private funds to run the consortia.

3.6.

Regulatory Issues

R&D environment in India and industrial and academic linkage in this sector is greatly
influenced by various legal and policy issues.
3.6.1. Bayh-Dole Act
In 1980 US congress passed two pieces of legislation that transformed the ownership,
management, and transfer of intellectual property. First, the Bayh Dole Act which
allowed universities, nonprofit research institutes, and teaching hospitals to own the
intellectual property resulting from federally funded research and to license it according
to terms of their choosing. Second, the 1980 Stevenson Wydler Technology Innovation
Act led to enhanced information dissemination from federal government to private
industry. It also required establishing offices for research and technology applications
whose role was to identify federally owned technologies with potential commercial
application and link it to potential users in state and local government and private
industry.

51

The US Bayh-Dole Act contributed significantly to towards commercialization of

research technologies from universities and research institutions. A survey conducted
by the Association of University Technology Managers (AUTM) showed that Bayh-Dole
act resulted in creation of 260,000 jobs and US$ 40 billion of US economy. As result of
these amendments, a study in NEJM35 showed that between 1990-2007, 9.3-21.2% of
all drugs involved in new-drug applications were from US public-sector institutions.
In 1978 in US public research institutions licensed less than 5% of total of 25,000-30,000
patents. Bayh-Dole act removed significant restrictions on ability of universities to earn
commercial royalties on inventions derived from publicly funded research hence
incentivizing scientists to pursue research with commercial applications. Over the last
40 years in US, research carried out at public-sector research institutions resulted in 153
new FDA-approved drugs, vaccine or new indications for existing drugs. At least 80% of
the 35 major drugs were based on scientific discoveries at public research institutions.
3.6.2. Protection and Utilization of Public Funded Intellectual Property Bill (PUPFIP)36
The PUPFIP Bill is an Indian version of the Bayh-Dole Act. The bill seeks to promote
creativity and innovation to enable India to compete globally and for the public good
by protecting all intellectual property that is the outcome of government-funded
research. The bill proposes to incentivize the creation of intellectual property (IP) and
mechanism for its protection and utilization. It encourages innovation in small and
medium enterprises (SMEs) and promotes collaboration between Government, private
enterprises and non-government organizations. The bill seeks commercialization of IP
created out of public funded research and development, bring more accountability to
institutes that use public funding and promote the culture of innovation in the country.
The IP rights will be held by the grant recipient or by the government if the recipient
does not choose to protect the IP. The income from IP will promote self-reliance and will
minimize dependence of universities, academic and research institutions and other
recipient organizations for government funding. Although the bill starts with noble
intentions, this legal transplantation across geo-political/cultural borders may not be
suitable for a developing country like India. For instance, one of the goals of the bill is to
make research institutions across India self-sufficient. On the contrary, it is observed
that patenting of technologies in universities and institutes have become cost centers
for them. For example, CSIR, one of India's largest patent filers, generate approximately
$ 1 million (Rs 4 crores) per year through commercialization of its patents, though
simultaneously they spend around Rs. 10 crores in patenting and licensing costs37.
35

The role of public sector research in discovery of drugs and vaccines,, Stevens et al., New England

Journal of Medicine,364: p535-41, 2011

36

Basheer, Shamnad, Outsourcing 'Bayh Dole' to India: Lost in Transplantation? (February 2, 2010).

Columbia Journal of Asian Law, Vol. 23, No. 2, 2010. Available at SSRN: http://ssrn.com/abstract=1546403
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1546403
37

TShamnad Basheer, Indian Patent Bill: Let's Not Be Too Hasty, SCIDEV.NET, Sept. 10, 2008,

http://www.scidev.net/en/opinions/indian-patent-bill-let-s-not-be-too-hasty.html
52

The bill also aims to foster greater accountability in public funded institutions. But,
forcing public funded institutions to patent any and all inventions they generate may not
help in achieving this goal. This is in contradiction to our national goals of promoting
science, research and development for the benefit of masses. This bill would lead to a
fundamental divide between universities as places of learning and as places of
profiteering. We need to balance patenting of all research by public funded research
institutes on one hand and on the other hand programs like Open Source Drug
Discovery (OSSD) project that the Council of Scientific and Industrial Research (CSIR) is
currently pursuing which promotes a culture of openness and transparency and
collaboration, and thus ensuring cheaper and more efficient drug discovery.
The bill provides for promotion of technology transfer without laying down any specific
framework and in turn results in hindering scholarly communications by promoting
secrecy. Provisions like obligations of recipients to make disclosure to government
within 60 days of actual knowledge of such creation or prohibition of public disclosure
or exhibition of public funded intellectual property unless steps have been taken to
protect it hinder technology transfer rather than facilitating it. The CSIR example
illustrates the need for caution rather than blind patenting spree and realistic
expectations in place for the mistaken assumption that a Bayh-Dole clone will make
universities cash cows overnight38. Also, transfer of rights to the government if the
recipient institution fails to patent within the specified timeline does not help either
party. A scientist can understand his invention and commercialize it better than
government agencies.
Knowledge/technology transfer can be better achieved by open access publishing which
ensures wider distribution of knowledge/technology rather than giving away exclusive
rights to private corporations for products of public funded research.
The bill assumes promotion of culture of innovation in India can be achieved by rigorous
patenting which might not be true. Patenting gives monopolistic rights and monopoly
retards innovation whereas, competition promotes innovation. A better result might be
achieved by spreading awareness of IP by educational and sensitization programs.
Therefore, the PUPFIP Bill needs serious reconsideration before it is passed in its present
form.
3.6.3. Intellectual Property Appellate Board
Intellectual Property Appellate Board (IPAB), a quasi judicial body was set up as a
statutory Board by the Government of India on 15.9.2003. It has been established to
hear appeals against the decisions of the Registrar and to hear applications for
rectification f entries in the Registrar of Trade Marks under the Trade Marks Act, 1999,
38

Basheer, Shamnad, Outsourcing 'Bayh Dole' to India: Lost in Transplantation? (February 2, 2010).

Columbia Journal of Asian Law, Vol. 23, No. 2, 2010. Available at SSRN: http://ssrn.com/abstract=1546403
53

the Geographical Indication of Goods (Registration and Protection) Act, 1999 and
Patents Act, 2005. IPAB has its headquarters at Chennai and it holds sittings, besides
Chennai at New Delhi, Mumbai, Kolkata and Ahmedabad.
While the IPAB was probably set up to speed up pendency, the actual disposal rates
published by the DIPP shows the complete inefficiency of the system. Of the 2245
trademark cases transferred to the IPAB, only 901 cases were decided in this period. Of
the 155 patent cases transferred to the IPAB only 21 cases were decided by the IPAB39.
The number of appeals/applications transferred from various High Courts (Transferred
Appeal / Transferred Rectification Application) and the number of original
appeals/application (Original Appeal / Original Rectification Application) directly filed
before the Intellectual Property Appellate Board are as given in Figure 22.

Figure 22: Number of Cases Handled by IPAB40

No. of Cases Handled by IPAB (as on 31.1.2010)
2500

2000

Patent Cases Received

1500

Patent Cases Disposed

Trademark Cases Received

1000

Trademark CasesDesposed
500

Patent Cases
Received

54

Patent Cases
Disposed

Trademark Cases
Received

Trademark Cases
Desposed

39

http://dipp.nic.in/anrepo_e/AnnualReport_Eng_2009-10.pdf

40

http://dipp.nic.in/anrepo_e/AnnualReport_Eng_2009-10.pdf

Recommendations
Indian industry, academia and the government have to work together to continue the
momentum created by the talented R&D pool in the last decade. Based on our
observations, we present a number of recommendations that, we believe, will
strengthen applied R&D in India.

4.1.

Academia/Industry Linkage

Interesting facts have been discovered in our journey so far to improve the applied R&D
model in India. There are challenges at every step and a single solution may not be
feasible for all situations. But an integrated approach can help in bringing technologies
to the market at a faster pace required by the growing economy. Institutes like IIT's and
IIM's are already building incubation centers and working towards an applied R&D
model. But more needs to be done to fill in the gaps existing in these models and look
further beyond the campus for improvement in the incubation model. There are several
such models existing around the world such as Silicon Valley and its association with
Stanford University, TechColumbus in Central Ohio in United States and more recently
the technology parks set up at the Universities in Brazil. Exact replication of these
models is not feasible due to variation in the local industry dynamics, but there are
some takeaways to strengthen academia-industry linkage in India.
4.1.1. Increase Awareness of Incubation Cells and their Utility
After discussions with several IIT alumni's one consensus was that there was less
awareness on IIT campuses regarding the incubation cells and their activities. Even
though some incubation cells are oriented toward entrepreneurship, the link between
the high technology research and its application for product development and
enterprise creation may not be clear. Hence some PhD students did not get involved in
these activities. Building awareness within IIT campus to stimulate more activity in
these cells should be taken as a priority.
4.1.2. Improve Integration for Better Access to Resources
The incubation cells on university campuses should look beyond the campus for
formation of clusters to streamline the process. Example of TechColumbus in United
States, which we discussed earlier, is worth mentioning here. Different stakeholders
form a closely knit community where access to resources is just a few blocks away. An
56

entrepreneur with a high tech idea can easily access help from professors at The Ohio
State of University, get market research done from the students at the Fisher College of
Business, get business plan evaluated through some investors and get all the incubation,
administrative, management and skill development support through TechColumbus.
4.1.3. Establish Industry R&D Centers on University Campuses
In order to strengthen the link with the industry, it is also necessary to shorten the link
by inviting private companies to set up R&D centers at University campuses. This would
require a lot of incentives from the Government and could be a long term plan, but
having done that there could be continuous dialogue between the industry and the
University. The continuous dialogue process is much efficient in the long run as
Universities and industries exchange more ideas together resulting in faster path to
market for the technologies. Often lessons learned from participatory research with one
industry can be extended to other groups saving cost and time. This however requires a
product champion on the Industry side. Typically the path to market for high end
research is long and somebody in the Industry needs to get the management buy-in to
stick through this complex process of commercialization.
4.1.4. Establish Technology Transfer Offices
A technology transfer office should address the following issues:

57

Change in culture of the institution, to highlight the potential benefits of

commercialization.

How to create value for the technologies discovered at institutions.

Technologies need not be state-of-the-art or disruptive to address market
needs. They can be an incremental innovation; however, they need to
differentiate from existing technologies in price or value created.

Frame policy guidelines for issues with IP ownership, revenue sharing,

equity with investors and use of university infrastructure by firms.

Conflict of interest publishing versus patenting, fostering spin-out versus

preserving institutional resources

Talent person with multidisciplinary understanding of disciplines,

understand the language of the industry, understanding of venture capital,
spin-outs and patent laws. Such multidisciplinary talent is hard to find
considering that the universities may not be willing compensate the person
appropriately.

4.2.

Formal policies for technology licensing agreements, material transfer

agreements, confidentiality.

Establish Contract R&D Institutions

Industry frequently encounters technical challenges that require immediate attention.

Academicians who are on a preset schedule cannot respond to such short-term needs.
Contract R&D organizations can provide expedient help in such circumstances via
multidisciplinary technical input and project management.

4.3.

Establish Knowledge Network

One of the methods to have a continuous dialogue between industry and academia is to
form a knowledge network for information sharing. It would be a database or a platform
where knowledge sharing can be done continuously by all the members of industry and
academia on their R&D needs and activities and be accessible to all the members. A
good example of such a shared network for research is CTDUT: Pipeline Technology
Center of Brazil, started by Petrobras, the largest oil and gas company in Brazil,
Transpetro, the largest pipeline company and Pontifcia Universidade Catlica do Rio de
Janeiro (PUC-Rio), a renowned University in Brazil, as shown in the CTDUT exhibit
earlier. One example of such a shared platform in India is the AutoCluster in Pune
established for innovation, creative learning and R&D in the automotive sector.
Encouraging research and educational institutes to join such a cluster would be highly
beneficial for the Auto sector in India41.

4.4.

Regulatory Recommendations

The goals of PUPFIP bill can be better achieved by firstly vesting more discretion in the
hands of scientists for commercialization of their research rather than a blind mandate
to patent. One successful example of such discretion would be Dr. Samir K. Brahmachari
from CSIR, who put the SARS genome in a publicly available database rather than
patenting it. This helped catalyze the drive for drug development for infectious diseases
and as such would not have been possible under the current framework of the bill.
Secondly, the bill must have public interest safeguards and therefore, licensing
provisions of the bill should be made non-exclusive as increased competition is likely to
42
lead to greater variety, lower prices and thereby maximum benefit to consumers . One
successful example of benefits of non-exclusive licensing is tremendous growth in the
41
42

http://www.autoclusterpune.org/aboutcluster.html
Basheer, Shamnad, Outsourcing 'Bayh Dole' to India: Lost in Transplantation? (February 2, 2010).
Columbia Journal of Asian Law, Vol. 23, No. 2, 2010. Available at SSRN: http://ssrn.com/abstract=1546403

58

field of biotechnology which was achieved by Stanford University's technology transfer

43
office widely licensing recombinant DNA (rDNA) patents to interested parties .
Thirdly, provisions of affordable pricing should be added to this bill so that drug patents
licensed to major pharmaceutical companies are available to poor at an affordable
price.
Overall, the bill needs to provide for greater transparency, measuring performance of
scientists, encouraging participation of local industries to indulge in scientific research
and development.

4.5.

R&D Consortia and Open Innovation

Patent Pool- A pool of patents should be created by the government or private

not-for-profit foundations which can be accessed by industry or academia for
further development based on licensing or royalty payments.

Recently Gilead Inc., a pharmaceutical firm, has tried such an initiative

by submitting patents for its HIV drugs to the medicines patent pool
program. These patents can be accessed by generic drug makers for
making generic drugs by paying royalties to Gilead.

Patient Sample Repository- A common pool of patient samples covering

various disease areas can be collected with the help of various hospitals.
Obtaining these samples can prove to bottlenecks in progress of critical projects
for both academics and firms alike.

Genomics consortia- Joint sharing of genomic data

Heavy investment from the government side is needed to encourage common

sharing of resources e.g.: In 1980 an investment of US$ 500 was done by the US
government for establishing the Sematech consortia for manufacturing semiconductors.

4.6

Technology Transfer and Incubation

43

Technology transfer officers trained in multi-disciplinary fields to

understand the potential applications of often basic technologies

Michael Lytton, The Rise of the Platform Technology Deal, MANAGING INTELL. PROP. 15 (Jul.-Aug. 1997),
http://www.mondaq.com/unitedstates/article.asp?articleid=7658

59

4.7.

4.8.

Universities should offer courses for training of potential technology

transfer officers in multi-disciplinary fields

Effective technology transfer also involves in figuring how scientists to

manage their time and effort to external stakeholders as well as their
internal research commitments.

Scientists, Universities and Licensing officers should be allowed to have an

equity or stake in the technologies which are commercialized (spin-offs or
licensing agreements) in lieu of licensing fees.

Incubation facilities should also be allowed to run as fee-for-service models

to generate revenue for their start-ups

Universities should be able to generate revenue from often underutilized

expensive equipments by using fee-for-service models.

Potential commercial technologies can be listed on the websites or a central

repository of all technologies can be maintained with Department of
Science and technologies for potential firms to look for licensing or joint
development.

IP Infrastructure and Regulation

Indian equivalent of Bayh-Dole Act, Utilization of Public Funded Intellectual

Property Bill (UPFIP) since 2008 is still pending in the Parliament. Need for
faster approval of bills meant for societal good.

An equivalent of Stevenson Act also needs to be formulated for finding

potential uses of public research for addressing societal needs

Transparency in the working of the various committees will lead to faster

and well managed systems

Incentives

Increasingly conducting high risk R&D is proving to be not so lucrative especially for the
pharmaceutical firms. Incentives may help increase the interest in high risk R&D.

60

4.8.1. Incentives for Scientists

Faculty should be incentivized to commercialize by giving equivalent credit

their inventions as much as their publication

Allow scientists from national labs and universities to form firms with their
own technologies. The scientists are given sabbaticals to invest sufficient
time for their start-ups but such 'time-offs' are not highly encouraged.

Successful commercialization of technologies should be equally rewarded

as publication of research paper for faculty tenure.

Scientists should be allowed to work full time or part time on

commercialization

Successful laboratories should be allowed to function autonomously as well

as raise private funds from firms or venture capital funds.

Equipments at public laboratories should be made available for small startups and large firms on fee-for-service basis.

Offering higher starting salaries to attract academics from abroad will result
in bringing not only the domain knowledge but also the best practices
followed in the west. China has successfully been able to attract significant
number of foreign trained scientists by offering fat pay packets and
research support.

Non-performing scientists should be shifted to administrative staff

positions such as procurement, etc.

A rigorous tenure track system along the lines of National Center for
Biological Sciences (NCBS), Bangalore should be put in place.

4.8.2. Universities and Research Institutions

Old public sector units have been slower in adapting to newer policies. Systems should
be set in place to help them revamp the system by hiring new leaders and faculties to
bring in the much needed change.

61

Newer institutions should be made sufficiently autonomous to work on

projects but with milestone payments upon showing sufficient progress of
the projects

All sectors should be incentivized to raise funds from private sector.

4.8.3. Incentives for Firms

Grants in form of grant-in-aid rather than loans for PPP grants

Small start-up firms should also be competitively allowed to compete for

government grants traditionally meant for academia. This will encourage a
healthy competition between industry and academia and ramp up the
capabilities of academic scientists.

R&D is high risk and low revenue propositions. In order to promote firms to
take up such initiatives following programs can be inducted.

Royalties generated from every patent can be turn used to support high risk R&D
program. UNITAID, a program for purchase of drugs for HIV, malaria and TB, utilizes
revenues generated from airline tickets to fund their program. Similar programs have
been funded in US- Kentucky Tobacco and Research Development Center (KTRDC)
research program is funded by charging 5 cents on sale of every pack of cigarette.

4.9.

Tax incentives for projects which involve academia participation.

Special Economic Zones (SEZs) should be created around universities for

setting up R&D units in and around universities

Government should float venture funds for seeding high-risk start-ups

especially for academic entrepreneurs. China has significantly invested in
providing equivalent amount of funds for start-ups.

Training

As discussed earlier, technology management and Intellectual Property management

are essential for the growth of R&D sector in India. Academic institutions all over India
have identified this gap in knowledge and are currently offering various courses to
address this issue. We, however, believe that a focused course on R&D and IP
management will benefit the industry and academia at large.
Mid-level managers in industries should be trained in R&D management or more
specifically risk management. Similarly, universities should develop programs for
technology commercialization and risk management to better prepare future graduates
to work in high-tech fields.

62

N O T E S

N O T E S

10/11 S&T mkmcreative@gmail.com

Indian School of Business

Battelle India

FICCI

Meena Saxena
Associate Director
Center for Leadership, Innovation and
Change (CLIC)
Indian School of Business
Gachibowli, Hyderabad 500 032

Shalendra Porwal
Managing Director and CEO
Battelle India
302, Panchshil Technology Park
Hinjewadi, Pune - 411 057

Sumeet Gupta
Head - Science & Tech / Innovation
FICCI
Federation House
Tansen Marg
New Delhi - 110 001

Tel
: +91-40-23187935
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