The Business of Invention
A brilliant idea or ground-breaking discovery is only the beginning. Unlocking its economic and social potential sometimes involves negotiating the often perilous path to market, which requires a bold vision, having the right people involved at the right time, a receptive environment, and sometimes a little bit of luck.
The history of invention at UBC is book-ended by two environmentally-focused ideas: one a vastly more efficient way to aid the reforestation of logged areas, and the other a new device for the purification of water. Both feature entrepreneurial students as inventors. All that separates them is 50 years and 2,998 other UBC inventions.
Over five decades, the innovation ecosystem has undergone many drastic changes. In 1961, when Jack Walters disclosed the Tree Planting Gun and Bullet system he initially conceived of while a student at UBC in the 1950s, there was no formal process at the university for managing and commercializing intellectual property, and all inventions were managed by Canadian Patents and Development Ltd. (CPDL). This changed in 1982 when UBC terminated its agreement with CPDL in order to manage its own intellectual property, and in 1984 created the University-Industry Liaison Office (UILO) – the first of its kind in Canada.
With an initial staff of three specializing in patents and licensing, the UILO allowed UBC to work directly with its own researchers and take a more strategic approach to commercialization. The intention was to increase opportunities for both UBC and its researchers to share in the financial benefits arising from research discoveries that had significant academic, economic and social impacts. The university had missed major opportunities to do so in the past, including the 1961 discovery of calcitonin by Dr.Harold Copp. Used as a treatment for osteoporosis and analgesic for bone cancer, it became the second most popular hormone treatment in the world.
By the time Dr. Madjid Mohseni and graduate student Kristian Dubrawski disclosed UBC’s 3,000th recorded invention in June 2011, UBC had developed an international reputation for its commercialization activities. The university’s discoveries – in diverse areas ranging from human therapeutics to computer software and engineering – are the basis of 150 spin-off companies, and products that have generated more than $5 billion in sales, along with widespread social and academic benefits. (And it’s worth noting that although Walters’ tree planting system – which enabled the planting of 1,500 seedlings an hour as opposed to 750 per day – was never a commercial success, it nevertheless left its mark; the concept of contained root systems used in the invention was the catalyst for containerized planting, now the predominant form of planting in BC.)
These days, the UILO also handles industry-sponsored research and has a broader range of approaches to advancing new discoveries that are not solely focused on extracting maximum financial value. Mohseni and Dubrawski’s water purification device, for example, has been identified as a clear candidate for advancement in keeping with UBC’s global access principles, designed to ensure developing world access to relevant technologies. The device uses electrocoagulation to remove impurities in an energy-efficient way, including elements such as arsenic found in groundwater in some areas of BC as well as many parts of the world such as Bangladesh.
Throughout 50 years of change, however, some things have stayed consistent, and the successful translation of the 3,000th discovery into a product faces many of the same challenges as the commercialization of Walters’ tree planting system. The path from lab to market is often perilous, with many outstanding scientific discoveries failing to make the transition. This is particularly true for disruptive, game-changing discoveries, which frequently emerge from basic scientific research with no commercial motivation. Such discoveries are typically 10 to 20 years away from becoming a successful product, and require not only receptive market conditions, but the strong leadership of technology champions who have the vision and drive to overcome obstacles encountered along the way.
The following vignettes reveal the circumstances behind just a few of UBC’s most successful innovations, highlighting the many factors involved in guiding them along the often arduous route to commercial success.
Following the Market
UBC’s first spin-off company, created in 1976, in many ways demonstrates how successful companies based on university technologies sometimes have to avoid pushing their technical discovery into an unreceptive market, and instead let it be pulled in the direction of the best opportunity. Vortek Industries Ltd. was created to commercialize the work of researchers led by Drs. Roy Nodwell and David Camm in the Department of Physics and Astronomy, who designed and developed an arc lamp capable of generating extremely high-intensity light. The lamp was recognized by The Guinness Book of World Records as the world’s most powerful, continuously burning light source. Potential applications included lighting for stadiums, search and rescue and other emergency response operations, and even film sets.
But it was not the light itself that would spell success for Vortek. What proved more valuable to potential customers was the rapid heating it produced. And so the company adapted and started providing thermal testing and certification for aerospace companies and NASA. The lamp was also an integral component of the Rapid Thermal Processing technology developed by Vortek that provided precise thermal control in the production of microchips and semiconductors. This led to Vortek’s acquisition by semiconductor giant Mattson Technology of California in 2004.
A New Learning Experience
A classroom project in UBC’s Computer Science department to improve course preparation and the student learning experience revolutionized e-learning and set the standard by which much university teaching is done today. In 1995 UBC’s Murray Goldberg and his teaching assistant, Sasan Salari, developed web-based course tools (WebCT), allowing educators to set up courses that contain searchable course notes, review material, discussion boards, quizzes, exams, image databases and chat rooms. After initially being made available free of charge to other institutions, in 1997 a company was spun-out to commercialize the WebCT product, with rookie entrepreneur Goldberg at the helm. Such was its success, the company was acquired in 1999 by Universal Learning Technologies of Boston, who retained the WebCT name, with Goldberg serving as Canadian president. It was estimated that by 2005 the software was being used by up to 14 million students daily across 80 countries. In February of 2006, WebCT was acquired by its major competitor, Blackboard®.
The Value of Scientific Curiosity
The most commercially successful UBC technology to date is the Visudyne®* therapy developed by QLT Inc. and used to treat a form of wet age-related macular degeneration (AMD), the leading cause of age-related blindness. Used in more than two million treatments worldwide, the genesis of the drug can be traced back to basic scientific curiosity. Dr. Julia Levy was on holiday with her family at their cottage in the Gulf Islands when she noticed that her children, who often played on the field around the cottage, sometimes developed lesions that looked like burns on their arms and legs. On returning to UBC, Levy consulted a colleague who was a plant biochemist. He identified cow parsley, a plant that grew abundantly around the cottage, as the major cause. It contains a light-activated drug in its sap. If the sap gets on the skin in sunny weather, it will create lesions. Levy began research into the potential of photo-activated chemicals, becoming a pioneer of photodynamic therapy. This treatment uses a dose of non-thermal laser light to activate drugs after they are injected into a patient’s bloodstream and have accumulated in the appropriate areas.
Visudyne® has improved the quality of life for patients worldwide and was the fundamental factor in the development of BC’s biotechnology sector.
Vision became a target for the company after Levy’s mother was diagnosed with wet AMD. Levy recognized similarities between this condition and the cancers that the company was focusing on at that time. Verteporfin (the active ingredient in Visudyne®) was discovered through UBC research led by Dr. David Dolphin, and the patents and know-how related to verteporfin were licensed exclusively to QLT in 1988. Visudyne® received regulatory approval in 2000, a full 19 years after the company initially spun-out of UBC. Its development period provided invaluable experience, training and research opportunities for numerous UBC students and faculty. Its commercialization has improved the quality of life for patients worldwide and was the fundamental factor in the development of BC’s biotechnology sector.
John Demco established the .CA domain name in 1987 – two years before the World Wide Web even emerged.
Canada’s identity on the internet was secured 25 years ago by the visionary work of John Demco, then Computing Facilities manager in the Department of Computer Science. Demco established the .CA domain name in 1987 – two years before the World Wide Web even emerged. Working with a team of fellow volunteers, he maintained the .CA registry until 2000, registering and recording more than 100,000 names before the registry was handed over to the Canadian Internet Registry Authority, a not-for-profit corporation that Demco helped establish in 1998. In 2012 the two millionth .CA domain is expected to be created for a Canadian business, individual or organization, making it one of the most recognized domain name extensions on the internet.
The Right Champion at the Right Time
In 2011, UBC professor emeritus Phil Hill received the Principal Award of the Ernest C. Manning Awards Foundation for his discovery 25 years earlier of a technology that enables diesel engines to run on clean-burning natural gas. Now being successfully commercialized by UBC spin-off company Westport Innovations, Dr. Hill’s technology almost didn’t make it out of the lab.
Hill conceived of and first developed the High Pressure Direct Injection technology in the late 1980s in his research lab at UBC’s Department of Mechanical Engineering. Supported by a market assessment funded through the UILO’s then new Demonstration Prototype Development Program, the technology initially attracted considerable interest and funding support.
By 1994, however, research funds were diminishing, and UBC faced mounting worldwide patent costs that would be hard to sustain. The technology had been marketed to major diesel engine manufacturers, but a suitable licensee had not been found, and the undesirable option of closing the technology was becoming a more realistic possibility by the day.
It was around this time that entrepreneur David Demers approached the UILO, looking
for a new business opportunity. Both sides recognized Dr. Hill’s discovery as a good fit,
and Demers established Westport Research (which later became Westport Innovations)
to commercialize the technology. The company maintains research partnerships with UBC to this day and, with Demers still at the helm, boasts partnerships and joint ventures with leading diesel engine and vehicle original equipment manufacturers from around the world. Currently employing more than 900 people, Westport develops, manufactures and distributes natural gas engines and fuel systems for new vehicles such as pickup trucks, refuse haulers and long-haul trucks, as well as developing natural gas technologies for rail, marine and high-horsepower equipment.
One Invention, Many Applications
An algorithm developed by Dr. David Lowe has become one of UBC’s most frequently licensed and diversely applied technologies. The SIFT (Scale Invariant Feature Transform) algorithm is able to recognize and match shared features in images. It was first licensed in the mobile robotics industry and was integrated into Sony’s electronic pet dog AIBO to recognize and respond to visual instructions from its “owners.”
It’s been 13 years since Dr. Lowe published his findings, and nine since a US patent issued. Over that time, strategic licensing activities have allowed licensees to gain exclusive rights in some specific fields of use, and consequently the technology has been used in applications as diverse as security, space robotics and mapping databases. It is also helping to detect and prevent items from leaving supermarkets hidden on the bottom of shopping carts by matching images taken by cameras at the checkout to stocked products in the store.
In 2002/03, Dr. Lowe and then PhD student Matthew Brown incorporated SIFT into software called Autostitch™, the world’s first automatic two-dimensional image stitcher. It was capable of identifying and selecting images sharing common elements, and then positioning and blending them into seamless panoramas of up to 360 degrees. Licensed by companies around the world, the inventors themselves spun-out their own company, Cloudburst Research, in 2009 to create the Autostitch™ for iPhone app, which became an instant hit with iPhone photographers and has sold well over 400,000 copies to date, in more than 80 countries.
The Autostitch™ for iPhone app became an instant hit with iPhone photographers and has sold well over 400,000 copies to date, in more than 80 countries.
In 2004, Gary Albach (a co-founder of Vortek Industries, UBC’s first spin-off company) returned to UBC to become the UILO’s first entrepreneur-in-residence. A key part of his role was to identify and support UBC companies that had been flying under the university’s radar due to the fact that they were created around the entrepreneurial zeal of current students, staff, faculty and recent alumni rather than being based on university intellectual property. By walking the halls, it soon became evident that there were many such companies. Although a number of them did receive
support from faculties and through the UILO’s entrepreneurs-in-residence, it was ad-hoc and for many other companies was non-existent. In 2010 UBC launched the entrepreneurship@UBC initiative to address this gap in support for student, alumni, faculty and staff entrepreneurs (see next page).
One of the many new companies that is benefiting from this initiative is Aeos Biomedical, whose innovative medical adhesive tape, Target Tape, has been developed to allow doctors to make more precise incisions during surgery. The technology emerged from UBC’s New Venture Design course – a collaborative entrepreneurial course which partners undergraduate students from UBC Engineering and the Sauder School of Business. Between 2009 and 2010, undergraduate engineering students Patricia Backlund and Colin O’Neill and commerce students Nicholas Seto, Wylie Spencer and Emi Yamada developed the concept, with O’Neill and Seto later incorporating Aeos Biomedical to bring the product to market.
The company was first supported by entrepreneurship@UBC in August 2010, when they were selected to take part in an Alumni Affairs event in Silicon Valley where they presented their business idea to alumni and venture capitalists. In the fall of 2011, Aeos Biomedical won the inaugural entrepreneurship@UBC Seed Accelerator Fund competition, ultimately securing an investment of $50,000, and they are also receiving support from the UILO’s Start-up Services Voucher program, providing them with up to $5,000 worth of in-kind services such as intellectual property strategy.
A Global Approach
In the fall of 2007, the university formalized a set of Global Access Principles it created in consultation with the UBC chapter of the student group Universities Allied for Essential Medicines. This was to ensure developing world access to relevant UBC technologies and research. The first licensing agreement in specific accordance with these principles was reached in May 2008 with Vancouver company iCo Therapeutics for a new formulation of a drug with the potential to treat leishmaniasis, a disease contracted by two million people a year, predominantly in the developing world.
The new oral formulation of amphotericin B was developed in the lab of Dr. Kishor Wasan. Under the terms of the license agreement, iCo Therapeutics gained the worldwide right to develop and sell the formulation in the developed world as a treatment for blood-borne fungal infections (a leading cause of death in immuno-compromised individuals). In return, through subsidized pricing, iCo will ensure a suitable formulation is accessible to countries in the developing world for the treatment of leishmaniasis. In 2009, iCo and the Canadian Institutes of Health Research (CIHR) established the Research Chair in Drug Delivery for Neglected Global Diseases, held by Dr. Wasan.
A Virtual Approach
Dr. Martin Gleave is based at the Prostate Centre at Vancouver General Hospital (VGH). In 1998, he developed a new therapy to address treatment-resistant cancers. Recognizing the potential value of this and subsequent related discoveries, the UILO worked with Dr. Gleave to help set up a spin-off company to develop and commercialize these therapies, introducing him to entrepreneur Scott Cormack. In 2000, the pair co-founded OncoGenex Technologies and took an innovative step in trying to bring the therapies through the hugely expensive clinical trial process to market. Rather than employ a large team of in-house researchers and technicians, a decision was made to keep the company “virtual” with a skeleton staff, and instead use funds to sponsor the necessary research, much of which was conducted by Dr. Gleave and his team at UBC and VGH.
This decision to keep the company virtual in its infancy not only allowed it to develop treatments with a very low amount of “capital burn,” but the research relationships it fostered also led in part to the creation and funding of the Prostate Centre’s Translational Research Initiative for Accelerated Discovery and Development.
In 2008 the company became OncoGenex Pharmaceuticals after completing a reverse takeover of a publically listed company. With Cormack still at the helm, OncoGenex has raised more than $50 million in the last year alone, and in partnership with global company Teva Pharmaceuticals, has successfully advanced its lead product, custirsen, into the later stages of clinical trials, known as Phase 3. By sensitizing tumor cells to standard chemotherapeutic drugs, trials to date suggest that the treatment could both prolong survival and reduce pain in patients with prostate cancer, and prolong survival in patients with lung cancer.
Supporting UBC Entrepreneurs
In 2010 UBC launched entrepreneurship@UBC, a cross-campus initiative led by Sauder School of Business, the faculties of Applied Science and Science and the UILO. The entrepreneurship@UBC program provides all student, faculty, staff and recent alumni entrepreneurs with access to the educational opportunities, space, capital, services, mentorship and networks to help them succeed, and has already been involved with approximately 200 new ventures and business ideas from entrepreneurs within all disciplines across the university. Alumni who have graduated within the last three years are eligible to apply for the services and funding offered by the initiative. Visit www.entrepreneurship.ubc.ca for more details.
The SPARK alumni branch is a joint initiative between business and computer science alumni and students. It’s dedicated to bringing together UBC’s entrepreneurial alumni and building bridges between student companies and industry contacts. The launch party last fall attracted more than 100 attendees and recent events have been focusing on the topic of business start-ups. Visit spark.alumni.ubc.ca to find out more.
Plans for UBC’s future Alumni Centre include an incubator space for start-ups, where students and recent alumni will have an opportunity to get their businesses off the ground. An important part of the program will be alumni mentors providing direction to young entrepreneurs.
Do you have mentoring skills that you would like to share? Don’t wait for the new building – sign up to be a mentor today: www.alumni.ubc.ca/get-involved/mentorship