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Stifling Discovery: Science Foundation Ireland’s New Mission and the Jobs Myth

May 22, 2012

Science Foundation Ireland (SFI) is making hugely significant changes to the system by which scientific research in Ireland is funded. From now on, SFI, which awards around €150 million annually for scientific research, will only fund research where it can be claimed from the outset that it will turn a profit and create jobs. Basic scientific research and discovery are to be marginalised into a tiny category that SFI has classified as “research for knowledge”.

The changes were announced by the recently recruited Director General of SFI, Mark Ferguson, who was appointed on the back of his own commercialisation experience. The new broom follows a glossy report by the Research Prioritisation Steering Group, a huge quango made up of more than seventy state bureaucrats, privateers-du-jour and academic hacks. Government ministers have also jumped on the bandwagon and are enthusiastically hailing commercialisation as a major employment initiative that is now a key part of the Action Plan for Jobs.

Welcome to the new order of ‘commercialisation‘ in a research factory to be run by grey suited bureaucrats and quick fix ministers. Forget methodological analysis or a wider consideration of the public interest; this is a grab for short term profit for the few. SFI, the principal state agency for research funding, has altered it’s mandate in order to bet the budget on research commercialisation gambles.

In this first of a two-part post we discuss the broader implications of the rush to commercialisation in Ireland and draw on some of the research experience in other countries. We find that there is compelling evidence that SFI’s strategy is wrong for Ireland.

In part two of this post we examine the failure of Renovo, the spin-off company that was founded by SFI’s newly appointed Director General, Mark Ferguson. The Renovo debacle raises further questions about SFI and it’s new research mandate.

Along the way in this post we also get an insight into the new ‘academic entrepreneur’ snake-oil that is seeping through the upper echelons of the Irish education system, inflating salaries at the top and misdirecting scarce resources.

The Monetising of Discovery

There’s gold in them thar college labs

Research commercialisation is the conversion of research results into products that can be transacted for profit. It involves turning the intellectual property of a university into a marketable commodity. The theory is that this will result in gains for the researcher, the university and the private sector.

Under the commercialisation model, a scientist makes a discovery in a university laboratory and then patents it to establish a monopoly and thereby stop others from gaining from it. The patent may then be sold directly on to a large multinational corporation or the researchers may form their own ‘spin-off company’ in order to retain a more lucrative stake in the potential profits.

The path from pioneering discovery to mass profit is beset by conflict and dispute about the division of the spoils between the inventor, the university and the privateers who provide the capital and the mass market access. It is the privateering lions who inevitably emerge from this jungle with most of the kill.

There are glaring conflicts between the aims of universities and those of profit seeking corporations. Satisfying the demands of shareholders for growth and for increasingly short term returns is the primary objective of investor owned companies. On the other hand, the university owes a duty to society to create and diffuse knowledge for the public good and to pursue truth without interference from vested interests.

The rush to institutionalise commercialisation into Irish universities should be halted until we have a considered debate about the effects and the distortions that will result from a change to a profit driven mandate. As late comers to the commercialisation fad, we should also learn from the mistakes of other nations who have already toyed with it.

The Perils of Commercialising University Research

“Those experiments which do not bring with them immediate gain are not to be condemned, for as the noble Bacon had declared, experiments of light ultimately conduce to a whole troop of inventions useful to the life and state of man” (Robert K. Merton, Science, Technology, and Society in Seventeenth Century England, 1938).

What impact will the proposed skewing of SFI incentives and funding have on the type of research that is undertaken in Ireland? The best inventions often arise from pure investigation that could not provide proof of an end product at the outset. This type of blue sky research will lose out in the new regime.

SFI recently introduced a pre-selection “Impact Statement” which is now required before applications for research funding can even be assessed by experts in the field. At this gateway stage a research proposal will have to pass a test of commercial relevance. A committee of venture capitalists, entrepreneurs, and R&D directors from major companies will get to block any research proposal that doesn’t fit the profit motive.

SFI is now following the ill-judged path of the UK funding agency the Engineering and Physical Sciences Research Council, who recently caused a storm by introducing a similar pre-selection process entitled Shaping CapabilitiesOpposition to this has come from numerous British scientists, as well as from the Royal Society, Institute of Physics, Council for the Mathematical Sciences, Royal Academy of Engineering, Royal Society of Chemistry and the Institution of Engineering & Technology.

Nine prominent Nobel science winners are also calling for a reversal of impact screening on the grounds that it treats excellence as “a secondary consideration” and “as a result is squandering British taxpayers’ money”. They explain that blue sky research was the initial key to their own discoveries which include gene splicing, the graphene layer, magnetic resonance imaging (MRI), metathesis reactions, cell cycle regulation and carbon chains:

“As Nobel laureates, we are all dedicated to scientific enquiry and know that unexpected observations and discoveries have had far-reaching benefits to industry and society. Enabling and following up on the most interesting of these unexpected observations will reap the greatest rewards.”

There are also very serious societal impacts (see Kumar for a discussion about the ethical conflicts in commercialisation). For example, it is less likely that research would be conducted into the treatment of diseases disproportionately affecting the poor, the treatment of diseases affecting only a small number of people and research into prevention rather than pharmaceutical treatments (Downie and Herder). There is also a risk that research may be designed to achieve favourable results and to avoid negative results.

In university research the emphasis is on discovery. Disclosure of findings, idea sharing and peer review are the norm.  In contrast, the commercialisation model involves patenting a discovery to acquire monopoly rights. Disclosure or exchange of information is discouraged or strictly controlled. Howard Schachman has argued that commercialisation is changing the scientific culture from one of “publish or perish” to one of “patent and prosper”. Polster (2003), highlights the societal cost of this approach:

“As more and more of the knowledge produced in universities becomes the private property of business, academics, and/or universities, the public gets little return on its investment in academic research. Not only are citizens frequently forced to pay for the knowledge or products that their tax dollars helped to produce, but these may even be inaccessible to them due to exclusive licensing agreements and/or prohibitively high prices for monopoly goods”.

Institutionalising a set of profit incentives into universities will also have multiple unintended consequences. Incentives to commercialise may not make academics better at inventing but may merely lead universities to push out more marginal inventions. One survey of university technology licensing officers was titled “Disclosure and licensing of university inventions: The best we can do with the s**t we get to work with“. The title, taken from a comment made by one of the university licensing officers, sums up what happens when you give universities an incentive to commercialise additional inventions but you can’t do anything to improve the quality of the inventions themselves.

The Gatorade Phenomenon

 “There is a particular momentum at present in the drive to commercialise scientific research. This is at the core of the Government’s Action Plan for Jobs 2012, announced last week: investment in research leading to jobs”.

Seán Sherlock, Minister for Research and Innovation (February 2012).

Coming soon to a university research lab near you.

SFI plans to have legislation amended to extend its remit to cover technology transfer. This will divert money from basic scientific research allocated by excellence, towards more directly speculative forms of research which may ultimately have commercial value.

The Minister for Jobs and Enterprise, Richard Bruton, has also trumpeted this new policy and he claims that it has created “magnets of attraction for foreign direct investment in Ireland”.

Guessing which might be of future benefit or the timescale over which its importance is measured is just that: guesswork. Moreover, the potential return for such ventures has proven to be very small.

The fanciful dream is that huge numbers of jobs will be created and that the Irish tax-payer will get all this money back from the intellectual property rights and licensing royalties on patents, if the spin-off ever starts generating profits. Let’s look a little more closely at the reality.

Ireland is a relative new-comer to this obsession with intellectual property, patents and technological transfer in academia, but it has been around for decades. In the US it is known as the Gatorade Phenomenon because of the money the University of Florida ultimately got for the patent on a sweet-salty drink its coach designed for the university’s football team, the ‘Gators’.

The Gatorade case spawned a legion of get-rich-quick schemes by academic institutions. However, universities soon discovered that patenting is no magic carpet ride.  Patents cost up to $50,000 in legal fees per application and only a minuscule percentage produce end products, let alone profitable ones.  In this “taxpayer-subsidised game of patent roulette that pays terrible odds”,  the majority of university technology licensing programs lose money.

For example, genetically modified frost-resistant fruit has been pursued for decades by the University of California without any commercial success.

The most successful University in the world in this arena is the Massachusetts Institute of Technology and it did manage to generate $89 million in 2010 from royalties and patents. But, with an annual budget of over $2,571 million, this is simply chump change and hardly a guide for university policy in general. In fact, revenues generated from the commercialisation of university research are less than one per cent of all of the university budgets in the United States.

For the Irish taxpayer, an additional problem is that the default route for a spin-out with potential, is to be sold to a bigger American firm, before there is any significant value added for the Irish economy (Hennigan, Finfacts, 2011).

But this is a misconception: there is gain – for those in the upper echelons of the academic institutions who have been doing quite nicely with their CEO-size salaries and for some privatateers who are eager to get their hands on public money. It is no coincidence that it is in that bastion of grey suits, UCD, that the majority of the top earners in Irish education reside. Indeed, it is precisely this gaggle of over-paid Vice Presidents and their hangers-on that have most benefited from this blurring of private and public.

Impact and Meaningless Rankings

SFI’s new slogan isexcellence with impact – a mantra suspiciously similar to that of the Research Council in the UK.

So how does one measure “impact“? As managerialism within third level education has become more rampant, academic management has floundered around looking for metrics to measure such poorly defined terms.

One favourite is the “impact factor” used to quantify how ‘good’ a journal is by the number of citations it receives over the previous two years. It has also been extended to judge individual researchers and their work through the impact factor of the journals they publish in.

Such metrics have proven to be easily gamed. Macdonald and Kam (2006), have observed how “the canny editor cultivates a cadre of regulars who can be relied upon to boost the measured quality of the journal by citing themselves and each other shamelessly.

Take the recent example of the Times Higher Education rankings scandal. Under the heading of “research impact” the virtually unknown Alexandria University of Egypt was placed fourth in the world — behind only Caltech, M.I.T. and Princeton, and ahead of both Harvard and Stanford. As it turned out, this remarkable achievement was down to the tireless work of one researcher Mohamed El Naschie, who managed to publish 320 papers in a journal that he edited himself.

While there have been efforts to raise awareness about the gaming of bibliometrics, the whole system of rankings, and the figures they depend upon, are so unreliable that arguments based upon them are largely fallacious.

The Big Short

SFI is embarking upon a hugely risky experiment in research commercialisation.  To date, there has been remarkably little debate about how such a transformation to a profit motive will undermine the research values of our universities.

The international evidence suggests that even the purported economic gains of such a shift are dubious and that wild claims about job creation are a fantasy of hapless government ministers. It will also cause a systemic distortion of research incentives while undermining a fundamental part of our scientific infrastructure. Moreover, as we will see in the next piece, it can also lead to disaster.

Funding of scientific research is essential not because it is some fantastic vehicle for generating products and jobs, but because it supports and maintains the nation’s scientific infrastructure.  This feeds into society in numerous ways, employment being one of them, but also through the production of better educated citizens with higher technical proficiencies.

As to which research gets funded, the over-riding criterion has to be quality. The higher the level of our attainment in any area of science, the better. In the next post we look at the Renovo debacle, in which the perils of ommercialisation are all too apparent.

6 Comments leave one →
  1. Михал Орела permalink
    May 23, 2012 6:43 am

    An interesting account of emerging realities In the Academy

  2. Gabriel Matthews permalink
    May 25, 2012 8:15 am

    Love the bit about the “cadre of regulars“ and Mohamed El Naschie. Excellent post.

  3. D. Ó Cléirigh permalink
    June 19, 2012 9:54 pm

    The following looks like an awful deal. SFI has started peer review of commercial and industrial impact. So the peer review evaluators are from outside Ireland, in line with SFI’s approach. They evaluate commercial potential. So researchers pitch their best business ideas to such evaluators. But that’s presenting the best business ideas to evaluators who can… take them on board, absorb information, and grab commercially confidential information.

    This looks like a big sell-out and exploitation of Irish research in a really bad way.

  4. Skirmish permalink
    June 25, 2012 5:44 pm

    Book-burning by the market.

    This urgently needs more airing. Most people don’t know of, much less understand, what is happening in our universities, which are being shamelessly commercialised under Labour ministers.

    The mainstream media cheers this on, and regurgitates the government, SFI and HEA press releases, while the infrastructure of knowledge is dismantled.

    If ‘pure science’ is treated like this, then what of the pursuit of knowledge in other disciplines? What are academics doing about it? Most seem only too happy to play along.


  1. Science Foundation Ireland, the Director General and the Renovo Debacle « Network for Irish Educational Standards
  2. Ninth Level Ireland » Blog Archive » Stifling Discovery: Science Foundation Ireland’s New Mission and the Jobs Myth

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