With money tight, universities scramble to profit from intellectual property

Search terms Duke University Anil Potti.

The following was written in response to a Chronicle editorial telling how the University of Missouri snagged 25 percent of a new app developed by a student.

✔ Fact Checker here. Good day.

FC has been following the growth of Duke's Office of Licensing and Ventures for some time -- the office set up to make sure that the University grabs its share of any intellectual property.

To be sure, most of this involves the faculty. But there are lessons to be learned for students.

We are troubled for two reasons:

First, much of our research is paid for by public money from the federal government. Or by entities like the American Cancer Society which enjoy tax breaks on their contributions and activities.

In these instances, we believe that all discoveries should be in the public realm, not subject to licensing fees or profit. If private industry paid for the research, then a financial gain would be understandable.

Second, our society has built walls around intellectual property so high, that unlike other societies in history that benefited from discoveries, our advances are held so that few citizens gain advantage immediately.

✔ Loyal Readers, there is big big bucks in this for Duke.

Two weeks ago one of the most distinguished senior faculty members, Dr. Allen Roses, director of Duke's Deane Drug Discovery Institute, licensed a test for Alzheimer's disease (very complicated genome test), to be made and sold by a Japanese firm. Up front price: $9 million.

The test determines if someone 60 years of age is likely to develop Alzheimer's within five or seven years. And the Japenese firm, making a drug for people at risk of Alzheimers, hopes to sell more of it because of the tests. If all this pans out, there will be additional payments of $78 million.

Roses acted thru a company he founded called Zinfandel (presumably named for his favorite wine?). While the corporate entanglements are not clear, these situations often involve a slice for Duke. And often Duke sells off nibbles of its slice to venture capitalists in order to cash out immediately.

Update: The good professor advises his favorite wine is Cabernet Sauvignon. And while FC said it is not unusual to have Duke owning a slice, in this instance Prof Roses says there is no relationship to Duke.

(The Duke ventures website is filled with information for potential investors. http://olv.duke.edu/index )

In the case of Dr Anil Potti, Loyal Readers may recall that after the heat really built up, Duke was charged with having a conflict of interest in seeing that Potti's work panned out -- standing to make BIG bucks.

Chancellor Dzau ordered Duke to sell off all its interests. This was buried in obscure language in an e-mail he sent to the medical community.

We tried to get additional information on the value of this part of the Potti Mess from the director of our licensing offices, Dr. Rose Ritts, and the ubiquitous VP for PR Michael Schoenfeld, both of whom shamefully did not acknowledge nor answer the Deputy Fact Checker's correspondence.

A good source in a position to know told FC that when fully developed, Potti's screening tests for cancer -- and their ability to tell which drugs would work best in each human -- could have been used by 700,000 people a year. And the source told us -- based upon the cost of similar tests -- the price tag for each test would easily be $1,000.

In the case of Dr. Homme Hellinga, FC has been told that Duke had a similar financial interest in seeing his work pan out. But this conflict of interest apparently was ignored when Duke reached judgment on him -- whatever the secret proceeding decided.

✔ Thank you for reading FC.