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RR&D's Bag of Technology Transfer Tools
David L. Jaffe, MS
Presented at RESNA '94
One of the most challenging goals of the Palo Alto VA's Rehabilitation
Research and Development Center (RR&D) is the transfer of its laboratory
prototypes to companies for manufacture. Without a purposeful program of
technology transfer, devices developed here would remain mere research
curiosities and would not benefit disabled veterans.
Despite past obstacles to technology transfer, there now exist a variety of
tools and incentives that can promote commercialization of RR&D's prototype
Commercializing the Center's rehabilitation products is a formidable task
since many of them face a limited market, are costly to develop, are sold to
people with limited financial means, involve third party payers, and are
subject to many Federal regulations. For these reasons, investors and
manufacturers are often hesitant to address this market, even though the need
for the product may be great.
For RR&D, the process of commercializing a prototype device requires a
substantial commitment of manpower and resources. Contacts with potential
manufacturers must be developed and maintained; advanced prototypes and
enhancements of the project may be required for demonstration; supporting
documents and promotional materials must be developed and produced; and
patentability and marketability must be investigated.
An important part of RR&D's mission is to develop assistive devices
which will directly benefit disabled veterans. Since the VA cannot by law
manufacture the devices developed at the Center, it must rely on industrial
companies to build and market them. The goal of technology transfer therefore,
is to promote RR&D's prototype devices to commercial businesses, move the
expertise embodied in the prototype to an interested company, and to often work
with that company to insure a manufacturable and marketable product that can
serve individuals with disabilities.
Method / Approach
Over the past seven years the repertoire of tools that facilitate technology
transfer has increased dramatically. Despite the existence of these tools,
there is no simple protocol that is universally applicable to every technology
transfer situation. In each instance, a different complex mix of preparation,
documentation, demonstration, contacts, and serendipity is required. Some of
the tools and methods available to RR&D are described below.
VA Technology Transfer History
A Technology Transfer Section (TTS) has been formed within RR&D to
accelerate, encourage and promote the transfer of technology, including the
commercialization of RR&D prototype products (now numbering thirty-one)
through collaboration with industry. This group serves to advise, organize,
supervise, and coordinate all of the Center's TT activities. It also serves as
a resource on these matters to other investigators within the Center, explores
and maintains contacts with industry, arranges workshops, prepares agreements,
and carries out negotiations when appropriate.
TTS has now formulated a strategy for technology transfer that comprises
three programs: 1) Recruitment - identifying potential new products from within
the Center, 2) Evaluation - identifying criteria and methods for screening
projects for commercial potential, and 3) Availability - developing and
maintaining manufacturer contacts, disseminating information, and negotiating
agreements or licenses.
Within TTS a systematic way to evaluate the technology transfer potential
and commercial feasibility of RR&D's projects has been developed. The
prototype product's value in each of the following areas is determined: 1) its
value to a potential licensee including potential market size, risks involved,
and competitive advantage offered; 2) its value to the user or purchaser
including importance of need, satisfaction of need, and alternatives to the
product; and 3) its value to the VA including concurrence with the Center's
mission and existence of champions inside and outside the Center.
A first round of assessments on six projects has provided valuable feedback
about the evaluation process, as well as giving a common reference for
discussion about specific projects. Project values which scored low in the
assessment process can now be seen as targets for improvement. For example, the
value to licensee might be rated low because of small potential market size.
This can provide impetus to the investigator to find wider applications for the
A Technology Transfer Advisory Board has been formed by TTS to provide broad
expertise in all facets of technology transfer. It consists of twelve non-
government specialists in the fields of technology licensing, patent and
Federal law, marketing, third party payers, product design, venture capital,
rehabilitation medicine, rehabilitation service delivery, manufacturing, and
business. The Board members have been helpful in suggesting new tactics and
continue to provide business and marketing advice.
TTS has developed a working database which contains information on all of
our projects, as well as information on the TT process. In addition, a database
of VA decision-makers, funding sources and foundations, rehabilitation
professionals, clinicians, engineers, potential manufacturers of RR&D
prototypes, students, users, press and media people, and interested lay people
is being maintained.
To increase the awareness of colleagues, users, manufacturers, health
professionals, entrepreneurs, and others of RR&D's projects and products,
the OnCenter newsletter is published two or three times a year. It highlights
new developments and opportunities in technology transfer, reports on specific
products or projects, and solicits ideas, suggestions, and inquiries about
RR&D's work. The distribution of OnCenter has lead to numerous personal
contacts that are the prelude to successful technology transfer. Five issues of
the newsletter have been published and mailed to over 2500 individuals and
organizations in the TTS database. In addition, RR&D routinely publishes
and disseminates a Progress Report every two to three years. It describes all
projects being undertaken in the Center's four program areas.
To assist in the technology transfer and subsequent commercial availability
of promising devices and techniques developed at RR&D, the VA has
established the Technology Transfer Service (VA-TTS) in Baltimore, MD. The
VA-TTS funds commercial prototypes of RR&D's devices and evaluates them
clinically within the VA system. Devices they approve may be recommended,
prescribed, and purchased by the VA for use by disabled veterans. Three
RR&D projects have employed this technology transfer procedure.
The passage of the Technology Transfer Act of 1986 by the U.S. Congress
authorized local Federal laboratories to negotiate and enter agreements
directly with industry for the purpose of commercializing government
technology. This legislation represents a significant change from the previous
laws which essentially prohibited such collaboration. It offered the first real
prospect for RR&D to participate actively in the commercialization of its
products. Before that time, it was considered a conflict of interest for
government employees to be involved in the commercialization of technologies
developed in Federal laboratories.
Funding and Partnering
The Technology Transfer Act established a mechanism called the Cooperative
R&D Agreement (CRADA) to promote and facilitate the transfer of technology
from a Federal laboratory to private commercialization. It permits a private
company to fund and work with RR&D toward the development, manufacture, and
marketing of a specific rehabilitation device.
In addition to CRADAs, RR&D can also enter into collaborations involving
the exchange of knowledge, facilities, or personnel where no money changes
In 1982 Congress established the Small Business Innovation Research (SBIR)
program to provide small business with the opportunity to acquire Federal
R&D funds to stimulate the development and commercialization of technology
for public and private benefit. Under Phase I of an SBIR competitive award, a
small business can receive up to $100,000 for up to six months to evaluate the
technical merit and feasibility of an idea, while in Phase II they can receive
an additional $750,000 for up to two years to expand the Phase I effort and
develop the technology in preparation for commercialization.
Under a funded SBIR project, both a small business and RR&D (serving as
a consultant) can receive funds that support moving a research prototype out of
the laboratory and into the marketplace.
The Small Business Technology Transfer program is similar to an SBIR, with
awards of $100,000 and $500,000 for Phase I and Phase II respectively. It is
intended to stimulate and foster scientific and technological innovation
through cooperative research and development carried out between small
business concerns and research institutions, foster technology transfer between
small business concerns and research institutions, and increase private sector
commercialization of innovations derived from Federal research and development.
The participation of a federal laboratory is mandatory in an STTR and appears
to be an ideal arrangement for a small company that desires to commercialize
The FDA Orphan Drug Medical Device Grant Program appears to support
technology transfer for medical devices for diseases and conditions that affect
small populations or have little financial incentive to research. They will
provide grants of up to $100,000 a year for up to 3 years for clinical trials
for existing prototypes and a similar amount over two years for projects with
additional development. Public and private non-profit and for- profit
organizations are eligible to apply for these awards.
Palo Alto Institute for Research and Education (PAIRE)
PAIRE is a non-profit organization within the VA Medical Center that can
administer funds from CRADAs, SBIRs, STTRs, and negotiated contracts that would
be difficult to handle under existing circumstances. It can support the hiring
of personnel, equipment purchases, and petty cash reimbursements required while
working under these situations.
AZTech is a not-for-profit, community-based enterprise operated by the
Rehabilitation Engineering Research Center on Technology Evaluation and
Transfer under a grant from National Institute on Disability and Rehabilitation
Research. The company will evaluate a prototype rehabilitation device for
commercial potential, identify corporate partners and establish business
agreements that are intended to move the product to market. Inventors
(including those who use assistive devices), companies, and research centers
are encouraged to participate in this program. A small application fee and a
working prototype are required. 
The National Technology Transfer Center (NTTC) has developed an electronic
bulletin board system called Business Gold, as an easy, convenient means of
accessing information on the newest federally funded technologies. Updated
regularly, the online system provides a new directory of Federal R&D
laboratories and new Federal technologies available for commercialization,
current Small Business Innovative Research solicitations, electronic mail
facilities, Federal R&D information, and related announcements. Future
enhancements include a conference calendar of technology transfer events, a
publications list, and education and training opportunities. The service is
free, and there are no online or report charges.
RR&D now has over eight years experience with technology transfer. Some
of the lessons learned are:
Tech transfer does not come about quickly, even in the best of
circumstances. It requires large doses of preparation, experience, and chance.
The time from transferring a working laboratory prototype to seeing a
product on the market can be reasonably short if the company is small,
adequately funded, and smart and thorough in its approach.
Hiring the RR&D developer is often critical to the small company's
success. Even though the VA loses a valuable investigator, there may be no more
effective means of fulfilling its mission to transfer its technology.
The movement of promising technology to industry offers the private
sector valuable knowledge, expertise, and R&D effort which they might
otherwise not be able to afford.
RR&D's successes include:
arranged for seven Center products to go into commercial production;
produced and distributed a technology transfer Guidebook authored
jointly with a private company;
published five issues of OnCenter aimed at technology transfer
professionals and potential manufacturers;
collaborated with VA Technology Transfer Service in Baltimore and with
Gallaudet University in Washington to put field four Center products into field
negotiated the following: two Cooperative R&D Agreements with
private companies; one license agreement; a publishing agreement; and two
agreements with private companies for patents and licensing;
filed twelve disclosures of inventions with VA's General Counsel in
Bringing a good project idea to the point of commercialization requires a
concerted, long-term technical effort, several infusions of funding, and plenty
of patience on the part of RR&D investigators.
Technology transfer is like gardening: no one can build a rose, but a good
gardener can produce a better one by tilling the soil well, selecting the right
seeds, getting the bugs out, and doing the right kind of fertilization,
watering, and pruning.
- AZTech Brochure, RERC-TET, University of Buffalo, 515 Kimball Tower,
Buffalo, NY 14214-3079.
This work is supported by the Department of Veteran Affairs' Rehabilitation
Research and Development Service.