Updated 1 decade ago
A decade ago, University of Florida professor Jamie Grooms and partner Richard Allen formed Regeneration Technologies, licensing Grooms’ UF research on bone tissue grafts as a mechanism to help patients regenerate their own natural tissue. As typically occurs when a university spins off a company, the school receives ongoing royalties and, in UF’s case, got an equity stake in the firm in exchange for allowing the company to use the technology. Since the company went into business, the university has reaped $70 million from RTI, including $25 million of the $75 million the company raised in its initial public offering in 2000.
That level of success is rare, however. Profitability figures aren’t available for the 133 companies spun off by Florida universities between 2000 and 2006, but university officials estimate that at least 20% of the firms are no longer operating.
Currently, UF, Florida State University, the University of South Florida and the University of Central Florida are the most active in the spinoff game, collectively generating some 20-plus spinoffs each year for the past five. Tom O’Neal, associate vice president for research and commercialization at UCF, says more of his school’s faculty have become interested in commercializing their technological and scientific research. Spinoffs, he says, are “where more real wealth is created.”
Because of the scope of research needed, the cost of intellectual property protection and the time and money it takes to evaluate the commercialization potential, it’s unlikely that many more Florida schools will jump in. For the schools already on the playing field, however, the potential visibility and income from successful spinoffs create incentives to stay in the game.
Some colleges, including the University of Miami and Florida Atlantic University, are ramping up their efforts. At UM’s Miller School of Medicine, Vice Provost for Technology Advancement Bart Chernow has set up UM Innovation to help package and market the university’s technology. He hopes to begin work this year on the first of three stages of a 7.2-acre life science park near the med school with about 1.4 million square feet of lab and office space for UM spinoffs as well as non-UM companies. Says Chernow, “By having other life sciences companies here, we create synergies.”
To help universities commercialize their technologies, the 2007 Florida Legislature set up the Institute for the Commercialization of Public Research and provided $1 million in funding under the auspices of Enterprise Florida, Florida’s economic development partnership. The institute will augment the work of tech transfer offices and will help market the research to angel investors and venture capital companies.
Successful spinoffs, university and state officials say, will also serve as talent pools for future companies. Allen, the co-founder of RTI who guided the company through its IPO, is controlling the reins of a new UF spinoff, Xhale (page 77). Says UF’s Day, “It’s only going to get better.”
Technology: An unmanned micro air vehicle (MAV) that uses an embedded-vision navigation system and bendable wing technology. In photo from left: Jason Grzywna, Amir Rubin and Bryan da Frota. [Photo: Jeffrey Camp]
Bryan da Frota, co-founder and CEO
Jason Grzywna, co-founder and director of unmanned systems
Amir Rubin, co-founder and director of core technology
Spun off: 2003
Sales: $700,000 in 2007; $5.6 million projected for 2008
Market: U.S. military and military of U.S. allies
“We basically gave an unmanned vehicle the ability to see,” says da Frota, who runs the business side of the company while Grzywna and Rubin — both electrical engineers — oversee the technology. The product, called Maveric, is a small device that a soldier under fire could toss into the air to locate enemy fire. Maveric would communicate enemy coordinates back to other military units that could return fire.
Prioria licensed bendable wing technology from UF’s MAV Lab, led by Pete Ifju.
The company’s funding so far has been what da Frota calls “blood, sweat and tears” along with money from engineering services they’ve provided to other companies. They are looking for $3 million to $6 million in investment capital and recently presented at the Florida Venture Forum Venture Capital Conference.
Technologies: LifeGate’s medical alert system communicates the need for emergency care in real time. Jotmate will provide software and hardware for electronic documentation of laboratory notes. Shown in photo: Camillo Ricordi. [Photo: UM]
San Francisco (UM)
Camillo Ricordi, distinguished professor of medicine and professor of surgery, biomedical engineering, microbiology and immunology at the University of Miami
Stephen Sanders, CEO
Steven Sikes, president
Spun off: 2007
Sales: LifeGate prototype will be completed in late spring; revenue is expected later this year.
Market: Medical professionals and people with chronic diseases
While Camillo Ricordi is best known as one of the world’s leading scientists in cell transplantation, he is also an entrepreneur. In 2007, with the support of the University of Miami Miller School of Medicine’s new vice provost for technology advancement, Bart Chernow, Ricordi and his partners launched LifeGate and Jotmate.
A separate company, Converge, has developed a device that limits cell therapies to certain areas of the body so that anti-rejection therapies don’t affect healthy parts of the body.
Ricordi’s idea for LifeGate came as he saw diabetics dying because in a severe hypoglycemic event they can lose consciousness within 10 seconds. Continuous glucose monitors can be linked to the LifeGate alert device, which provides a wireless signal to emergency professionals. “Time can save lives,” says Ricordi.
Technology: Topical skin preparation to treat actinic keratosis and other skin cancers. Shown in photo: Stephen Chakoff[Photo: Daniel Portnoy]
Boca Raton (FAU)
Stephen Chakoff, co-founder, president and CEO
Elliot Hahn, co-founder and industry adviser, who is also chairman emeritus of Fort Lauderdale generic-drug maker Andrx, now owned by Watson Pharmaceuticals
Spun off: 2005
Market: Pharmaceutical companies and possibly over-the-counter sunscreens
Research by Herbert Weissbach at Florida Atlantic University’s Center of Excellence in Biomedical and Marine Biotechnology led to a combination of agents that work together to target and kill cancer cells without damaging healthy cells. CHS, located at the Technology Business Incubator at Florida Atlantic Research and Development Park, is performing a “proof of concept” study with Skin and Cancer Associates in Plantation and is preparing for discussions with the U.S. Food and Drug Administration on potential applications, which may include a formulation sold in an over-the-counter sunscreen.
Technology: Breath-based substance detection for medical applications. Shown in photo: Richard Allen [Photo: Jeffrey Camp]
Richard Allen, CEO
Richard J. Melker, professor of anesthesiology, pediatrics and biomedical engineering at the University of Florida; chief technology officer of Xhale
Donn Dennis, professor in the Departments of Anesthesiology, Psychiatry and Pharmacology & Experimental Therapeutics in the College of Medicine and director of Nanomedicine at the University of Florida; chief science officer of Xhale
Spun off: 2005
Sales: Expected to begin in 2009
Market: Pharmaceutical and diagnostic companies
Xhale’s hand-held device technology lets pharmaceutical companies conducting clinical trials determine if patients are taking the medications being tested. The company is researching a way for diabetics to check their blood glucose level by blowing into the hand-held device rather than drawing blood.
Allen teamed up with Melker and Dennis after leaving one of UF’s most successful spinoffs, Regeneration Technologies, and setting up Synogen, a firm that helps create medical technology companies. With his experience and connections, he’s raised $10 million, even though Xhale won’t make its first sales at least until 2009.
Product: Fitness programs and products, especially for children.Shown in photo: Debby Mitchell. [Photo: Jeffrey Camp]
Debby Mitchell, associate professor in the College of Education, University of Central Florida; founder and president of GeoFitness
Spun off: 2002
Sales: $1.3 million in 2007; $3 million projected in 2008
Market: Schools, boys and girls clubs, day care centers, after-school programs and fitness facilities
Mitchell’s fitness products include GeoMat exercise mats with numbers that teach children where to place hands and feet as well as number recognition and even math. There are also DVDs, fitness curriculums and a GeoFloat to use in water. Mitchell is extending her research on how children learn to include special needs and autistic children. The company, based at the UCF Technology Incubator, has nine full-time and two part-time employees.
Technology: Robot that makes multilayered laboratory samples by dipping slides into polymer solutions. Shown in photo: Joseph Schlenoff [Photo: Steve Leukanech]
Spun off: 2000
Sales: $120,000 to $150,000 by selling eight to 10 robots at $15,000 each
Market: University research labs
“We invented a widget. It was a useful widget. People asked us if they could buy them,” says Schlenoff. The robot, which uses technology licensed from Schlenoff’s research at Florida State University, speeds up the process of coating slides used in biotech applications and also makes the process more precise.
Working out of a small shop at Innovation Park, a research and development park affiliated with Florida State University and Florida A&M University, Schlenoff, his wife and their one employee work with local suppliers to produce the robots and sell them to institutions in the U.S., Hong Kong, Australia, the Middle East and Sweden. The firm markets only by word of mouth, trying to limit growth to a level that Schlenoff can handle. “I’m very concerned about keeping quality control.”
Schlenoff says he’s interested in selling the company, in part because there are other projects he’d like to develop.