Structuring University– Private Partnerships for Developing and Commercializing Transgenic Horticultural Crops - Transgenic Horticultural Crops: Challenges and Opportunities - page 241

commercial. value.. Generally,. one. researcher. in. a. university.institution. may.freely.
access.another.researcher's.patented.research.tool.for.academic.study..This.oppor-
tunity.does.not.typically.extend.to.private.researchers.unless.a.formal.agreement.is.
forged..Thus,.a.private.company.looking.to.partner.with.a.particular.researcher,.for.
example,.may.experience.hold-up.at.the.commercialization.stage.because.the.public.
research.partner.did.not.obtain.formal.rights.to.all.research.inputs.(i.e.,.background.
rights). from. some. other. private. company.. Note. also. that. if. numerous. university.
researchers.and.graduate.students.are.involved.in.a.research.project,.industry.risks.
loss.of.privacy,.and.protection.for.proprietary.information.
The.interests.of.parties.outside.a.research.agreement.(i.e.,.third.parties).are.also.
at.risk.under.public-private.research.agreements..If.an.agreement.is.not.effectively.
structured.with.regard.to.patenting.and.licensing.rights,.a.third-party.interest.in.hav-
ing.access.to.research.products.and.innovations.may.not.be.adequately.represented..
In.fact,.blocking.patents.can.and.do.arise. 22
In.summary,.the.cooperation.between.universities.and.industry.opens.a.series.of.
questions.. Does. the. proit-driven. sponsor. shift. the. university's. mission. away. from.
basic.research?.Does.industry's.desire.to.exploit.IP.rights.interfere.with.communica-
tion.within.and.between.universities.to.an.extent.harmful.to.open.science? 23 .These.
conlicts. are. an. inevitable. consequence. of. a. fundamental. clash. between. a. public.
system.that.encourages.openness.in.science.and.an.industrial.system.that.gives.inan-
cial.rewards.based.on.secrecy..In.the.end,.this.all.boils.down.to.one.question:.can.
a. university-industry. partnership. be. socially. beneicial. or,. more. precisely,. Pareto.
improving?*
Scotchmer 23 .argues.that.a.public-private.venture.is.justiiable.for.big.science.proj-
ects..For.certain.large.projects,.the.public.sector.may.face.the.problem.of.choosing.
the.right.investments.(those.with.high.probability.of.success).and.making.sure.the.
funds.are.used.as.intended;.the.private.sector,.on.the.other.hand,.has.the.expertise.
needed.to.screen.likely.successful.projects.but.sometimes.cannot.reap.unappropri-
able.social.beneits,.thus.is.unable.to.recover.the.cost.of.research..In.this.situation,.
a.PPP.can.help.solve.the.duality.problem..If.the.partners.do.not.have.access.to.the.
same.information,.however,.industry.may.manipulate.the.public.sector.into.subsidiz-
ing.its'.privately.proitable.projects.
t wo l eadInG u nIverSIty -p rIvate r&d p artnerShIpS
The. University. of. California. formed. a. partnership. with. the. Novartis. Agricultural.
Discovery.Institute,.Inc..(NADI).in.1998.that.allowed.Berkeley.to.retain.control.of.
an.open.research.agenda..Initially,.an.open.call.is.put.out.to.participating.faculty.for.
research.proposals.with.neither.the.University.nor.NADI.deining.the.type.of.project.
proposals.that.would.be.considered..Further,.the.committee.that.allocates.funding.
to.each.project.(all.proposed.projects.receive.some.amount.of.funding).is.made.up.
of.three.Berkeley.University.faculty.members.and.two.members.representing.NADI..
In.addition,.the.criteria.used.for.ranking.project.include.the.quality.and.intellectual.
* . A.partnership.is.Pareto.improving.if.at.least.one.partner.is.made.better.off.by.joining.and.no.partner.is.
made.worse.off.by.joining.