The beginning of university entrepreneurship in Japan: TLOs and bioventures lead the way

Following reforms between 1998 and 2004, Japan’s technology transfer system closely resembles the U.S. Bayh-Dole system. Numbers of TLO patents and licenses and numbers of startups are respectable compared to U.S. numbers shortly after enactment of Bayh-Dole. However, capabilities of TLOs vary, average royalties are low, and business prospects for most startups seem limited. In contrast, joint research with companies is increasing rapidly. Most joint research inventions are jointly owned giving the companies an automatic de facto, non-transferable, royalty-free and license. Data from one university show a large proportion of engineering and materials/chemistry inventions are attributed to joint research with large companies, thus limiting opportunities for startup formation and licensing to other small companies. (In biomedicine, pre-emption of discoveries by joint research is less.) Pre-emption of university discoveries (often publicly funded) under joint research agreements recreates the pre-reform system, where corporate donations also enabled pre-emption of discoveries. Like the old system, the new system is advantageous to established companies. Strengthening the formal system (including programs to assist startups) may redress this balance and give Japan the benefits of both types of technology transfer systems.

Robert KnellerEmail: