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A 1984 study of biotechnology companies reveals that nearly one-half of all such firms fund research in universities. Industry may support as much as one-quarter of all biotechnology research in institutions of higher education. These investments seem to be yielding substantial benefits to involved firms. Per dollar invested, university research is generating more patent applications than is other company research. Research relationships do pose some risks to traditional university values such as openness of communication among scholars. These risks may be greater in relationships involving small firms. The data also reveal that government is now, and seems likely to remain, the principal source of support for university research in biotechnology.

The growth of university-industry research relationships in biotechnology has raised questions concerning their effects, both positive and negative, on universities. A survey of over 1200 faculty members at 40 major universities in the United States reveals that biotechnology researchers with industrial support publish at higher rates, patent more frequently, participate in more administrative and professional activities and earn more than colleagues without such support. At the same time, faculty with industry funds are much more likely than other biotechnology faculty to report that their research has resulted in trade secrets and that commercial considerations have influenced their choice of research projects. Although the data do not establish a causal connection between industrial support and these faculty behaviors, our findings strongly suggest that university-industry research relationships have both benefits and risks for academic institutions. The challenge for universities is to find ways to manage these relationships that will preserve the benefits while minimizing the risks.An analysis is provided of a survey of over 1,200 faculty members at 40 major U.S. universities concerning their research activities and funding by industrial sources. The survey findings suggest that university-industry biotechnology research relationships have both benefits and risks for the university. Faculty members receiving industry support tend to be more productive. They publish, patent, and earn more. They participate in more administrative and professional activities, while teaching as much as other faculty members. However, their research also leads to more unpublished trade secrets, and commercial considerations may influence their choice of projects. The authors recommend public as well as commercial funding of research, protection of the right to publish research results, and university-industry agreements that do not unduly restrict faculty behavior.