Research pick: Science-based spin-offs - "The role of pre-formation intangible assets in the endowment of science-based university spin-offs"

Science-based university spin-offs, especially in the biotech sector, play an important role in transforming cutting-edge academic science into marketable technological products. However, such start-ups face lots of challenges that can be very different from those encountered by conventional startups. Research in the International Journal of Technology Management has looked at the complexities and potential of such spin-offs and sheds new light on the role played by the academic scientists involved in the process and how launch timing can make all the difference.

Andrew Park of the University of Victoria, Canada, and colleagues explain that unlike typical start-ups, which might bring a product to market relatively quickly, new biotechnology companies often have long periods of financial investment and require lengthy development, testing, and regulatory periods for their products. This is particularly true in drug development, where the path from the laboratory bench to the marketplace can span a decade or more, not least because of the need for extensive clinical trials and the completion of regulatory requirements. As such, there is often a greater need to plan strategically and to use resources more effectively even before the spin-off company is officially launched.

Many laboratory scientists make the leap from bench to business, some with much greater success than others. The successful scientist-entrepreneurs bring with them their research acumen and intellectual property, but also various intangible assets that can make or break a spin-off company. Among those intangibles might be research publications and patents, networks of contacts and collaborators, and access to funding opportunities that might be unavailable to companies with no direct academic links

The paper’s case studies of three biotechnology spin-offs within the British Columbia innovation ecosystem suggests that the value of intangible assets is usually only realised when strong entrepreneurial capabilities are available to the start-up company. These capabilities are not just about business acumen but also an understanding of how to align the technology with market needs, protect intellectual property effectively, and mentor the founding team to reach biotech commercialization successfully. Critically, the timing of a company launch can correlate strongly with success or failure, the researchers found.

Park, A., Goudarzi, A., Yaghmaie, P., Thomas, V.J. and Maine, E. (2024) ‘The role of pre-formation intangible assets in the endowment of science-based university spin-offs’, Int. J. Technology Management, Vol. 96, No. 4, pp.230–260.