Biotechnology research left a bad taste in the mouths of many companies a decade or two ago because their university research investments fostered little development. Professors were happy to accept grants and churn out reports that often concluded more research was needed. But companies need to sell products to stay alive. What happened to MEMS (micro electromechanical systems) is similar to what happened to other devices. MEMS have been around for some 20 years but only recently have served as a basis for real products.

There is an example of how better to shape the relationship between academia and industry in SBIRs (Small Business Investment Research) grants and similar codevelopment arrangements. Under these 25-year-old but little publicized plans, companies showing new concept product get development funding from government agencies, and universities help finalize the product plans.

The grants target small companies that lack the skills to write winning proposals, but need funds for a next-generation product. Firms qualify for funds by passing a rigorous peer review that looks for ideas which must stand out as worthy of development. SBIRs are sponsored by NSF, NIH, DOD, and other agencies. (Google SBIR for a more complete list.)

Because the goal is to commercialize a product, “the program replicates a typical development cycle in a company,” says Michael Viguerie, president of Medconx Inc., Mountain View, Calif. “The program has milestones and deliverables, and it's monitored by company R&D management.” The advantage of using a university as a development center is the availability of equipment small companies could never afford, such as scanning electron microscopes and metal-sputtering systems. Universities like the arrangement because they get to publish the work.

“The first round of funding may be about $90,000, but later rounds can approach $900,000,” says Marc Madou, professor of mechanical engineering at UC Irvine, Calif. When Madou was at Ohio State University, he and Viguerie helped plan the first SBIRs for a Medconx product.

To illustrate the program's potential, Val Montenegro, president of Biomems Technologies, Irvine, suggests examining the more recent track record of MEMS. “Thanks to SBIRs, MEMS technology is a starting point for several coming developments. For instance, imagine a pressure, temperature, and viscosity sensor that fits on the tip of a catheter. Thermocouples are too big. We're using an SBIR to turn a MEMS pressure sensor into an implantable medical device that should be ready in about 10 months.”

Another idea headed for commercialization thanks to SBIRs is a small bio marker visible by ultrasound, X-ray, MRI, and CT scans. Most markers are visible only by CT. The new markers could be placed, for example, in the prostate gland or a mammary duct to monitor the growth or movement of a tumor, deliver a drug, or identify tissue margins to guide surgery. This would be a big improvement over the current practice of slicing out a large piece of tissue. Montegrande's marker is also a MEMS device. Semiconductor manufacturing techniques could easily make 1,000 marker chips on a 6 × 4 in. wafer and do so inexpensively.

“The trick is to take the leap-of-faith out of the relationship between company and university,” says Viguerie. One key to a successful partnership is in finding the right people for the development work. “You can't just hire any Ph.D. The secret is, you just have to know them, and then manage a direct milestone-driven project” says Viguerie. But the SBIR can be the first step to a useful relationship.