DEVELOPMENT OF UNIVERSITY-INDUSTRY PARTNERSHIPS FOR THE PROMOTION OF INNOVATION AND TRANSFER

OF TECHNOLOGY: PHILIPPINES

Prepared by Lydia G. Tansinsin, DSc. (hc)

Abstract

This paper is a study on the Philippines experience regarding the University-

Industry Partnership especially in the awareness of the researchers, scientists and

technologists in protecting their intellectual property rights. The state and private

universities were consulted on their activities, their policies on the relationship of

the participants in any intellectual product or output and sources of funds in

undertaking research and development.

Introduction:

This paper will look at the “factors contributing to the success/failure of university-industry

partnerships, and in particular on the effective management of intellectual property assets created

by such partnerships as commissioned by the World Intellectual Property Office (WIPO) of

Geneva. This will be undertaken by reviewing the practices of universities active in research and

development and find out it such linkages exist and the mechanisms applied to make the

partnership beneficial with each other. It does not end in such study but it is expected that the

university-industry partnership will be further improved if it exists and if non-existent, create an

environment that would catalyze the working relationship of the university and industry in order

to contribute to the effective and efficient collaboration of both partners. A strong partnership

will enhance the competitiveness of the industry with the support of the university in its technical

requirements. With this objective, the paper will include information from major universities

that are undertaking research and development and its relationship with industry. It will analyze

and evaluate the findings made and try to formulate guidelines that may assist the universities in

at lease setting up a technology transfer office overseeing the results of research and

development that may eventually be commercialized.

The University-lndustry partnership has slowly become the by-word in the academic world in

order to make the graduates aware of the real situation and direct their interest in assisting the

industry in improving products and services. The system of university-industry partnership has

been introduced by the Department of Science and Technology (DOST) about three decades ago.

The first to respond was the University of the Philippines at Diliman, Quezon City. The system

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adopted was for the engineering students to immerse themselves in an industrial plant and

participate in the operations of the company. This arrangement was undertaken with the

participation of faculty members who also took part in the activities in the plant site. Afterwards,

whatever lessons learned or problems encountered were analyzed in line with the theories

learned in school and feedback was transmitted to the industry. Another system practiced was an

agreement to undertake research and development for the industry. The faculty and the student

were involved in this activity.

In such arrangement, the intellectual property aspect in the university-industry partnership was

not given much attention by the parties involved. The linkages were purely on training and not

to undertake research and development. However, activities entered into by the university with

the industry may not include research and development but in the course of training, innovation

may occur. Thus, the training agreement should have included provision on intellectual property

rights.

Intellectual Property Rights in the Philippines:

The idea of intellectual property rights is not new in the Philippines. A year after the declaration

of independence in the Philippines in July 1946, the Patent and Trademark Laws were adopted,

establishing the Philippine Patent Office. In 1951, the Philippines saw the importance of

protecting the literary and artistic works, thus she became a contracting party to Berne

Convention which covers copyrights. In the adopted Patent Law the aspect of utility model was

not included, so in 1953 this was introduced. It is only in 1965 that the Philippines became a

contracting party to the Protection of Industrial Property (Patent and Trademark). In 1972, an

amendment was made on Act No. 3134 by the issuance of Presidential Decree (PD) no. 49,

known as the Copyright Law. In order to be part of the General Agreement on Tariffs and Trade,

the Philippines became a contracting party to Paris Convention establishing the World

Intellectual Property Organization (WIPO). A year later in 1981, the Philippines became a

contracting party to Budapest Treaty on the International Recognition of the Deposit of Micro-

organism for purposes of Patent Procedure. After which in 1984, the Philippines became a party

to the International Convention for the protection of Performers, Producers of Phonograms and

Broadcasting Organization.

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In line with the new development and reorganization of the government structure, the Philippine

Patent Office was merged with the Technology Transfer Board and became known as the Bureau

of Patents, Trademarks and Technology Transfer (BPTTT) under the Department of Trade and

Industry. In the Uruguay Round Final Act in 1994, the Philippines were one of the signatories of

the Agreement establishing the World Trade Agreement (WTO) which was ratified by the

Philippine Senate.

In 1997, the Intellectual Property Code was signed into law and took effect in 1998 and at the

same time, it established the Intellectual Property Office (IPO), replacing the BPTTT office.

Three years after, the Layout-Design (topography) law was signed into law, Republic Act (RA)

No. 9150 on August 6, 2001. On August 27 of the same year, the Philippines became a member

to the Patent Cooperation Treaty. The following year, 2002, Republic Act No. 9168, entitled

New Plant Varieties was approved into law. (report of IPO Philippines)

The Intellectual Property Office under the Department (Ministry) of Trade and Industry is

responsible for the implementation of the intellectual property rights together with the National

Library for copyrights. The regulation of the videogram is under the Optical and Videogram

Regulatory Board under the Department of (Ministry) of Trade and Industry.

Policy Framework on Intellectual Property Rights

Even prior to the recent amendments made in updating the Intellectual Property Code, the

National Science Development Board (NSDB) was created in 1958 under Republic Act No.

2067, (1958) and has been advocating the importance of intellectual property rights. In fact, an

office attached to the National Science Development Board (NSDB) known as the Philippine

Inventors Commission (PIC) was in existence since 1964 under R.A. No. 3850 and amended by

Presidential Decree (EO) No. 1423 in 1978 as one of the attached agencies of the office. The PIC

was eventually replaced by the Technology Application and Promotion Institute (TAPI) when

the NSDB was reorganized and became the National Science and Technology Authority (NSTA)

under Executive Order no. 784 in 1982 and was amended to expand the incentives to investors

under RA No. 7459, April 26, 1992. In 1987, there was again a reorganization of the office and

eventually changing the status of NSTA as a line department under Executive Order no. 128, in

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1987 and renamed Department (Ministry) of Science and Technology (DOST). Even with the

changed of status and name of the science and technology office, TAPI/DOST has advocated the

registration of intellectual property rights by researchers, scientists and technologists who are the

clientele of the TAPI. This office has been assisting inventors in its financial and technical

requirements, especially in linking the inventors and inventor-faculty members of the university,

with financial institutions that may finance the production and/or manufacture of their

inventions. At the same time it advocates among the researchers, scientists, engineers and

technologists to apply for a patent for their creative outputs. However, this fell on deaf ears, as

the researchers believe that their research outputs should be opened to the public and need not be

registered as an exclusive property of the researchers with the exception of some researchers.

Aside from the various assistance extended to inventors including those coming for the academe,

the Department of Science and Technology made it a point to have a policy that would protect

the intellectual property of its researchers in the different research institutes and the universities.

Prior to the present policies, a number of issuances were made by the then National Science

Development Board (NSDB) about the importance of preserving the property rights of the

researchers. This was embodied in the NSDB Resolutions and Policies. Lately, a number of

issuances had been made and the latest is the DOST Memorandum Circular No. 001, series of

2002, entitled, “Providing For a Mechanism To Operationalize Intellectual Property and

Technology Management in the Department of Science and Technology and the National

Research and Development System, and Amending Pertinent Provisions of Memorandum

Circulars (MC) 001 (Series of 1998) and 002 (Series of 1992), and For Other Purposes”, on

March 2002, and was issued to conform with the latest development in the amended Intellectual

Property Rights (IPR) law as enumerated in the previous paragraphs, copy attached as ANNEX

“A” (only the pertinent paragraph of the mentioned MC). This is a guide for all the researchers,

scientists and technologists that are extended financial grants from the DOST. The policy states

that whenever a patent application is made by the researcher/scientist/technologist/inventor it

should be assigned to the DOST. This policy is embodied in Administrative Order No. 006,

series of 2004, dated October 14, 2004 ANNEX “A-1” (page 28, Paragraph 9).

The DOST tries to influence the research agencies and the academic institutions in protecting

their intellectual property as DOST is mandated to coordinate and supervise all the R&D

research and technology projects and to set policies relative to the implementation of research

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and development activities in the Philippines. Thus, the DOST Memoranda No, 001, Series of

2002 is applicable to all research institutions, including universities and colleges, receiving

financial assistance for R&D activities. While most of the universities do not have any IPR

policy, the DOST–IPR Policy is adopted until such time that each and every university will have

their very own IPR policy.

It may be said that the registration of patent does not differentiate whether the applicant is from

the university or a private individual. In other words, the intellectual property law applies to

every inventor without special treatment extended to university or academic researcher/inventor

provided the invention is new and useful. Any inventor can apply for a patent at the IPO-Phils.

The university researcher or private inventor may request from the Department of Science and

Technology for financial assistance in applying for a patent thru the Technology Assistance and

Promotion Institute (TAPI), one of the service agencies of the DOST. Thru this Office,

assistance may extend the assistance of a patent lawyer to assist in the application and

preparation of documents to be submitted to the Intellectual Property Office under the

Department of Trade and Industry (DTI). In applying for a patent, certain fee is required by the

IPO and it varies depending on the amount of the assets applied for. If the asset is less than P20

million it is considered small wherein the university group is under this category while those

applying with an asset of more than P20 million is considered big. Please see attached schedule

of fees as ANNEX “B”. Included in the annex is the schedule of fees for copyrights which is

under the National Library. It is important to register the intellectual property being an asset that

belongs to the individual.

The Department of Science and Technology together with the industry, academe, government

and non-governmental groups formulated in July 8, 2002 the latest National Science and

Technology Plan (NSTP) 2002-2020. The NSTP provides the policy framework and directions

for science and technology in the Philippines. It sets the S & T vision and defines the goals over

the short, medium and long-term period. The Plan enunciates the following S & T strategies:

niching and clustering; addressing pressing national problems; developing S & T human

resources; providing support to small, medium enterprises; accelerating technology transfer and

utilization; building and upgrading S & T infrastructure; strengthening government-industry-

academe-civil society and international linkages; improving S & T governance; and promoting

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and popularizing S & T and intellectual property rights. The plan covers all research institutions

and academic institutions undertaking research, thus the different memorandum issued by the

DOST is expected to be observed especially by the researcher and institutions that availed the

DOST research funds.

On the other hand, the IPO is making ll efforts together with DOST to promote the registration of

intellectual outputs of all the research institutes by conducting seminars and workshops in the

different forum. Participants are from the academe, industry, inventors government and non-

governmental offices.

Nature/Type of University-Industry Partnership:

The nature or type of university-industry partnership maybe classified as follows:

1. Contractual research and development

2. Support of an industry’s research and development activities

3. Licensing and transfer of technology

4. R & D joint ventures and support for spin-off companies

5. Consultancy by university faculty

6. Funding post-graduate or graduate students

7. On-the-job training of students in industry

Contractual research and development maybe undertaken between the industry and the university

with financial funds. It may be in the form of cooperative research or joint research with foreign

or local funding. In actual practice, the university taps the Department of Science and

Technology for financial assistance with nominal assistance for the industry. Aside financial

assistance for the DOST, resourceful faculty members may received foreign assistance for

research and development to be undertaken. The sources of funds my come for counterpart

university, UNDP, UNIDO, European Union and others.

Support from industry is still small compared with other countries as firms look at research

activity as an expense and not as insurance for new or better quality product and high

productivity. Most of the companies have quality control unit but not in the real sense of R & D

of a fully equipped laboratory that would allow researcher to undertake research to improve their

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products, process and materials. However, research activity for marketing and other social

researches are undertaken with full funding support.

The licensing of research results is gradually happening as illustrated in this paper. However, the

art of valuation, negotiation and licensing is still wanting in the universities. The researcher and

the university rely on private patent lawyers and law firms who try to understand the needs of the

researcher/academe. There are a number of law offices dealing in the registration of inventions.

Even TAPI of the DOST is also tapping the services of this group to assist the researchers to

register their intellectual property rights. In patenting and negotiating for transfer or licensing of

technology, University of the Philippines at Los Banos has some experienced and the terms of

the agreement is made confidential. On the other hand, the University of the Philippines

at Manila patented their research results and assigned to the Philippine Council for Health

Research and Development/DOST. The patent as assigned to DOST negotiated with the industry

for its commercial production. It may be true that some consultancy service is between the

faculty member and the company, however, there are arrangements including the university as

the facilities of the university will be used in testing the technology. In this case, the contract

became a tripartite agreement. Furthermore, consultancy is part of the agreement to be sure that

the technology will work as envisioned.

In the Magna Carta for Scientists and Technologists, Republic Act No. 8439, approved on

December 22, 1997 took effect on February 4, 1998. The research or consultancy work may be

done outside of the research institutes or university within the regular office time, provided the

arrangement is approved by the institution. However, in other universities the agreement is on a

case to case basis. Thus, the urgent need to have an IPR policy for all the Universities.

With regards to R & D joint ventures and support for spin-off companies is still in its infant

stage. The private sector in a joint venture with the university has to agree that the technology

and equipment available in the university will be utilized as part of the investment of the

university while the private sector will provide other needed equipment unavailable in the

university plus operational expenses in some cases. The university and the industry have to

agree on the estimated total cost of the project and discuss the share of each party, either in kind

or in cash. This would include the services of the research/scientist/technologist.

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Spin-off of research results ready for commercialization is encouraged with the industry and the

university to be partners. Or the researcher may exploit the research results with the industry

like at the University of the Philippines at Los Banos, however, most of the patents acquired

have lapsed and not commercialized. (Annex “C”).

Venture capital may be provided for this type of activity. The Technology Incubation for

Commercialization Program (TECHNICOM) of DOST may be tapped to assist the university

and industry to bridge the gap between technology innovation and technology application.

TECHNICOM is a “comprehensive and unified strategy to enhance technology development for

commercialization and to fast-track the transfer and commercialization of promising R&R results

of government R&D institutes, academe and the private sector. Incubation, as used here, refers

to the provision of complete set of support activities to guide technology development for

commercialization. In short, through the TECHNICOM, it aims to encourage researches with

commercialization as end objective, following the principle of “laboratory to shelf” approach”

“The TECHNICOM, bridging the gap between the stage of technology development and actual

adoption and commercialization, targets to: 1) stimulate technological innovation; 2) strengthen

the capacity of enterprises to tap and adapt promising R&D results; 3) increase private sector

investment and adoption of government-initiated R&D breakthroughs; and 4) maximize benefits

from government’s investments in R&D activities.” “As of today, the TECHNICOM supports

the commercialization of the following promising technologies; locally developed PCV-based

access point deployment kit, the Bayanihan Linux terminal server installer as part of the Open

Source Thin Client System; the Bayanihan computing system; the PVP-Carrageenan Hydrogels

for burn/wound dressing; and the Salmonella Das, among others” (13)

The Intellectual Property Office-Phils (IPO) has a new service program known as the

“Technology Information Brokering and Matching Program Framework(TIBMP)”. The TIBMP

was established primarily to address the information concerns of export winners and priority

small and medium enterprises (SME) sectors. Its mission is to promote, establish and enhance

business linkages between prospective users of technology, the SMEs and the suppliers of the

technology like the inventors, patent holders, technical institutions and the like. This program is

an information-based services to include the following: packaged patent and technology

information for easy access, retrieval and dissemination of SMEs; access to data files of

prospective suppliers and users of technology; matching and linking potential users and

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suppliers of technology; assistance in identifying potential sources of technology based on

individual requirements; and assistance in negotiating for terms and condition in technology

acquisition and adoption.

A private initiative to bridge the academic institutions and the private sector is the Philippine

Emerging Startups Open (PESO) patterned after the MIT $50K Entrepreneurship competition in

association with the Massachusetts Institute of Technology (MIT) Tech Club of the Philippines.

PESO will allow to connect with people across academia, industry and government as well as

experienced mentors both here and abroad; create, teams with the right mix of skills who will be

trained to write, refine, and pitch strong business plans to industry experts and venture capitals;

and catalyze, the building of technology and innovation-based businesses by providing support

from the PESO network even after the competition is over. Recently PESO conducted a

competition to identify technologies that may have commercial potentials numbering 10 finalists,

to name them as follows: (a) Bio-enterprise Filipinas Inc. will be dealing with polydroxybutyrate

resins via a proprietary technology that makes use of bacteria and coconut water; (b) Blue Talk is

a company that aims to provide innovative Voice Over Internet Protocol (VOIP) services; (c)

Biotech, will produce a biotechnology tool that will boost the production of genetically superior

goats; (d) Enhanced Solo, covers work to prevent papaya ringspot virus (PRSV) by producing

seedlings resistant to PRSV; (e) LinSOC, will offer Linux Based Hardware Terminals at a much

lower cost; (f) Medical Electronic Diagnostic Solutions, will design and manufacture e-Health

devices and will be a manufacturer of biomedical monitoring modules and a provide of cellphone

applications and server units to health care facilities; (g) Kamlong, apply a technology to

increase production of tomatoes especially during off season; (h) Schyro Water International,

will produce cost effective high-purity water other than the standard water purification; and (i)

Team CSPC, will produce an innovative rotary drying technology for semi-processing of

Eucheuma seaweeds—an important source of semi-refined carrageenan (SRC). The finalists

will be announced in the near future. It may be mentioned that most of ten finalists came from

the academe.

Consultancy of faculty members are allowed by the university provided the task of teaching is

not neglected. Consultancy is a means to strengthen the capability of the faculty member.

Actually, this is the offshoot of the research undertaken simultaneously with teaching, building

up its expertise at the same time raising the prestige of the university. However, before entering

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into a consultancy, the faculty, university and researcher should have a memorandum of

understanding to be transparent and avoid any conflict of interest for all the parties.

In fact, in some universities, like the University of the Philippines, foundation is established to

deal with this type consultancy. A certain percentage of faculty income is given to the

foundation as the agreement is between the foundation and the industry.

Hardly, would the industry fund post-graduate or graduate students, item no. 6, as the industry

would rather employ graduates, with tertiary or graduate degrees but not to fund their studies

during employment in the industry except for short term seminars or lectures. This was the

experience by the DOST management in the implementation of the Engineering Science and

Technology Program (ESEP) of the Department of Science and Technology, a World Bank

funded program, and implemented in 1992. All the industries consulted were offered scholarship

slots for their personnel in 1990 prior to the implementation of the program in order to allow

their employees to take up graduate studies to be funded by ESEP except the salary of the

employee which will be the counterpart of the industry. Unfortunately, the industry was not

receptive to such an idea. The industry would rather employ those who have completed their

graduate studies and this is the assurance to make in making the ESEP program a success. Thus,

any employee who wishes to participate in the ESEP scholarship program, must first resign from

his company with the possibility of being rehired by the industry after graduation. This is the

only assurance the industry can give as their participation in the ESEP project.

On-the job training, some universities have an agreement with the industry but on a limited scale.

Though, the private companies allow on the job-training, they are wary that the student may

disrupt the operations of the company. However, on the other hand, some companies are

receptive to have students around to have extra hand to assist in their operation. Also, it may

help in inputting new ideas to improve the system. Selected companies have accepted students

from the University of the Philippines, de la Salle University, Far Eastern University, University

of Santo Tomas and others during summer time or an immersion of one to two semesters as part

of their curriculum. After observing the students, the company may eventually hires the student

after graduation.

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Aside from the different activities mentioned-above, a private group is supporting high school

teachers to take up graduate courses focused on science, math, physics, biology, chemistry and

English including short term trainings. This the “Foundation for Upgrading the Standards of

Education (EUSE) under the leadership of an industrial magnate. There is another program

under the Metro Bank Foundation identifying outstanding teachers in the three levels of

education, namely elementary, high school and tertiary. The awards are in the form of cash and

for the teachers and material and equipment to the affiliated schools.

University-Partnership with Industry

In 2004 there are 34 state funded universities and 77 state colleges excluding the community

colleges and universities and 1,349 private universities and 1,349 private universities and

colleges based on report of the Commission on Higher Education (CHED).

For this study, only the major universities with strong R&D units in science and technology and

graduate programs were included. Some of the state and private universities consulted were the

University of the Philippines, University of Santo Tomas, Ateneo de Manila University, De la

Salle University, Technological University of the Philippines, San Carlos University, Central

Philippine University, Polytechnic University of the Philippines, Mapua Institute of Technology,

Adamson University, Ateneo de Davao University, Xavier University, Mindanao State

University-Iligan Institute of Technology, Far Eastern University, Leyte State University,

Mariano Marcos Memorial State University, Bulacan State University, and others.

Among the universities named

, only the University of the Philippines (UP) have an office called “Technology Licensing Office

(TLO)” which was just created in 2004. Prior to the creation of the TLO, the university has the

Intellectual Property Office under the Office of the Vice-President for Planning, way back in

1995. Lately, the UP Board of Regents, approved on May 30, 2004 a policy, entitled:

“Governing Principles and Policies on Intellectual Property Rights of the University of the

Philippines System”, revising the earlier version. The full implementation can only be done after

consultation with the faculty members. In preparation for this consultation a “Primer” for the

said Principles has been crafted last March 15, 2004 to be reviewed by the different offices

concerned. After which, the final draft will be presented for final approval of the UP Board of

Regents.

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The other universities, like the University of Santo Tomas has a “Code of Ethics for

Researchers”, 1995, which is mentioned in Article IV, paragraph 4, to quote, “The UST

Researcher shall share with the funding agency proprietary rights to research results with

commercial potential.” And in June 2004, university-wide policy was released, entitled: “UST

Policies and Guidelines for Research”, which unfortunately did not include the intellectual

property rights provision that will govern the product of research. While at the De La Salle

University, they have an internal policy, entitled “Policies on Intellectual Property Rights, DSLU

System Institutions” which was approved on September 20, 2004 by the Council of Deans. A

temporary office is in place to attend to the implementation of the policy even prior to the

approval of the IPR policy.

On the other hand, Ateneo de Manila University, is just starting to discuss the formulation of an

intellectual property rights policy, an information provided by their researchers when

interviewed.

Generally, the universities do not have internal or external policies on intellectual property rights

nor specific IPR units to take care of this activity. Whenever, the universities enter into a

memorandum of agreement with industry, the rights of parties involved are specifically stated

on a case to case basis.

The universities identified for this study were the institutions with considerable qualified

technical manpower, facilities and infrastructure that can service the industry. Though the

number of universities and colleges are numerous not all are ready to support the industries as

the S&T researchers are still wanting. This statement is supported by an article, entitled: “An In-

depth study of the College/University-Industry Linkage in the Philippines” by Dr. Divina M.

Edralin commissioned by Commission on Higher Education (CHED) as published in the Higher

Educations Research Papers, ISBN 971-840-044-3, Volume 1, 2001. The identified problems

confronting the university-industry partnership, to quote: “Several problem areas surfaced in the

examination of research and development of research and development partnerships of Higher

Education Institutes (HEIs) with industry. These have something to do with: (1). Administrative

and financial support of partner agencies, particularly the bureaucratic requirements and

processes (e.g., red tape in the evaluation of proposals, project delays, limited budget, etc.; (2).

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Problems concerning faculties and the staff members, particularly lack of full time researchers,

scientists, and experts in statistics, and lack of faculty involvement due to teaching loads, lack of

faculty with research skills and experience; (3). Lack of administrative and financial support

from the school; and (4). Problems concerning the supervision and implementation of projects

by the school.”

It may also be mentioned further that some of the industry sector are still in doubt of the

capabilities of the local laboratories, thus the industry are consulting their mother company or

just buy or have a foreign license for a particular technology. However, lately, the institutions

that participated in the ESEP program improved their technical manpower, with a number of

their faculty members trained under the graduate program for master and doctoral degrees, in

local and foreign institutions who returned to their respective universities. In said program, their

university research facilities and equipment were upgraded including their library holdings.

ESEP Program graduated 29 overseas doctoral and masters degrees in sciences and engineering,

17 local doctoral degrees, 202 local master’s degrees, 270 Master in Engineering 270 with a total

of 518 graduates. There are still on-going scholars under this program with a total of 77.

Overall total for degree program including the ongoing scholars is 595. Overseas training was

also extended for 14 laboratory technicians for 3 months. Furthermore, to strengthen the

information needed by the researchers/scientists/technologists, 20 overseas training for librarians

for a period of 6 to 3 months were implemented especially in computerization of library

holdings. Graduates from local and foreign institutions are affiliated with UP, UST, ADMU,

DLSU, SCU, MSU-IIT and others. With this development of qualified and highly trained

technical manpower, the industries started to have confidence in partnering with the university.

Other training for graduate studies were sponsored by the DOST under its national scholarship

program other than ESEP and from foreign government scholarship programs graduating master

and doctoral degree holders in the different fields of science and engineering. However,

graduates of the agricultural group outnumbered the other professional groups. Under the above-

mentioned programs, it produced highly skilled graduates, but unfortunately, some graduates

migrated to the foreign country where they got their education even before they can serve their

obligation to the institution or right after completion of the service contract

Extent of University-Industry Partnership

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The university-industry partnership is usually negotiated directly with the faculty/researcher

members for services required by the industry. The areas covered may range from simple

problem solving of substitution or search for new materials, new and improved process,

biotechnology and others, depending upon the industry being assisted.

The DOST started the program in 1990 in order to assist the micro and small industries in

upgrading the manufacturing and productivity of the said sectors. This program is known as the

“Manufacturing Productivity Extension Program (MPEX)” under the TAPI/DOST. It was

implemented initially in early 1990 by recruiting faculty members from the different disciplines,

eg. Industrial, chemical, electrical, and mechanical engineering, business and management, and

others that were needed by the industry to be assisted. The team were from the faculty of the

UP-SERDEP, UST, DLSU, ADMU, Mapua Institute of Technology and others. The team

evaluated the overall operations of the firm and gave recommendations for the improvement of

the same. This includes the management and financial aspects of the manufacturing. After such

observations, analysis and adopting the recommendations made by team, the company’s

productivity was improved and the profit was increased by 10% to 30%. Lately, this program

was spin-off to the private groups composed of professionals from the academe but financially

supported by TAPI whenever there is request for MPEX assistance. The firm do not pay for this

technical assistance extended with the condition that the firm is willing to give full commitment

and cooperation specially in sharing relevant information required by the consultancy team.

Furthermore, request for assistance is within the priority list as defined in the National Science

and Technology Plan (NSTP). This is a tripartite linkage and cooperation with DOST, academe

and industry, though limited in scale. Plus, the fact that the expertise of the academe is shared

with the industry, with DOST catalyzing the same thru its technical and financial assistance. By

this system, the faculty members can relate their theoretical knowledge with actual experience.

At the same time assisting the industry in its quality productivity and competitiveness in the local

and global markets.

In this program, the aspect of IPR was neglected. This is true for similar programs and projects

implemented with industry in the early days. Lately, the awareness of faculty members on the

importance of IPR and the benefits to be derived in registering the invention is gradually

increasing.

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As practiced before, negotiations or agreements in most cases were not very strict in the

application of intellectual property rights. It is only during this past two decades that the

researchers, scientists and technologists and even the university administration become sensitive

in the protection of their intellectual property rights.

Data retrieved from the Intellectual Property Office (IPO), covering the period 1995 to 2004,

eleven (11) patents are registered and approved under the university while thirty two (32)

inventions and five (5) utility models are pending registration. This includes the patent

application of the UP System. Looking at the UP System, as a model, three (3) application for

patents was made in 1996, however from 1997 to 1999 there were no patent application filed.

However, in the year 200l, one patent application was filed, followed by 3 applications in year

200l, then it jumped to 14 patent applications in year 2002, a decrease in year 2003 to 8 and in

year 2004 again 8 patent applications were filed at the IPO-Phils and in other foreign countries,

under the Patent Cooperation Treaty (PCT) were simultaneous registration in the USA, Japan

Malaysia, Taiwan and others in done. Some more patented invention may be added in the list, if

only the university or school affiliation is indicated in the .data available at the IPO. It may be

mentioned that UP at Los Banos has 5 approved patents. However from the report of the UP

System, no patent has been transferred nor commercialized at the present. At the present, the UP

Technology Licensing Office has negotiated the licensing of a technology entitled “Titanium

Nitride Coating invention and is currently being tested by the two private companies with a

Memorandum of Agreement entered into and taking into consideration the IPR aspect of the

invention.

To cite an example, a faculty/researcher who patented her research result, sold the patent without

any intervention of the University of the Philippines (UP) as the patent was not assigned to the

university, thus it was not recorded in the UP system data bank. The technology is about a

growth and regulation hormone. This is an example of not strictly implementing the policy on

intellectual property rights of the university. It is true that in l985, UP issued Executive Order no

2, while the Policy Guidelines on All Copyrights and Patentable Works and the Policies, Rules

and Regulations Governing Patentable and Copyrightable Works Produced by University

Personnel,

16

The University of Santo Tomas (UST) is negotiating to entered into a licensing agreement with a

local pharmaceutical to commercialize a product of research, “Tonkin” ointment. This is the first

time to enter into a licensing agreement with an industry. This is a research fully funded by the

university budget without the intervention or funding from the industry that is adopting the

technology. The tentative pertinent provision of License Agreement, Article 4 on the “Research

and Invention Rights”, states, to quote: “In the event that either Party shall develop a New

Improvement relating to Licensed Product, or to any other derivative thereof, the Party who

developed the New Improvement shall promptly advise the other of the same.”

Furthemore ther provision states: “New Improvement shall form part of Proprietary Information

and is subject to the provisions of Article 25 (CONFIDENTIALITY).’

‘If the Licensor developed New Improvement, title to it shall vest with the Licensor.

The Licensor shall promptly offer the Licensee a license to New Improvement

subject to another agreement.”

“If the Licensee generated New Improvement, title to New Improvement shall vest

with both the Licensor and the Licensee. The Licensee shall have the right to use

and exercise such New Improvement in the Licensed Territory under royalty-free

arrangements for the life of the patent.”

“Particulars to be notified by the Party shall include chemical and physical data,

assay method/s and results, method/s of manufacturing and compounding, method/s

of analysis, as well as pharmacologic and clinical data.”

The Offeree shall have three (3) months from the date of such offer to declare

acceptance of the same.”

The Licensee shall have, under Most Favored Terms, the right of first refusal to

license New Improvements developments by the Licensor.”

The De la Salle University (DLSU) thru the Center of Engineering Research, Training and

Consultancy entered into a Research Partnership Agreement with a private company, in 2002.

The pertinent provision of the “Research Partnership Agreement” is hereby quoted:

“no. 4, In commissioning the research, Company X does not claim ownership to

any patentable material or invention, utility model and other intellectual property

right created, made or developed by DLSU- CERTC, Company X acknowledges

the ownership by DLSU-CERTC of these intellectual properties including but

17

not limited to, the sole and exclusive right of DLSU-CERTC to file, prosecute and

maintain patent and utility model applications or other registration of intellectual

property rights in or out of the Philippines.”

Ateneo de Manila University (ADMU), or known as AJWCC, have a into a Memorandum of

Agreement with two companies, namely: Company One (private corporation) and Company Two

(private corporation) to establish a wireless competency Center that would do research and

development on wireless mobile application. The intellectual property rights over whatever

software, programs, applications and the like that may be developed in the Center except for

commission work for either of the parties, the ownership over the intellectual property rights

shall be governed by a separate agreement. The trademarks, brand names, logos and identifiers

or service marks cannot be used by either of the parties without written consent. Article of 3 of

the Memorandum of Agreement, provides “Intellectual Property Rights”, to quote:

3.1. All rights, titles and interests in and to all intellectual property of each Party

shall be the sole property of the said Party and no such right, title

or interest is authorized to be transferred by virtue of this MOA.”

3.2. On a case to case basis and prior to the commencement of each project, the

Parties shall enter into a written agreement in good faith with

respect to all intellectual property rights that may be created pursuant to this

MOA. The said agreement shall comply with the provisions of the Intellectual

Property Code and shall be consistent with the existing intellectual

property rules, regulations and policies of the Parties.

3.21. Neither Company One nor Company Two shall lay claim to the intellectual

property rights over whatever software, programs, applications and

the like that may be developed in the AJWCC, except if the

development of such is commissioned by either of them, in which

instance, the ownership over the intellectual property rights shall be

governed by a separate agreement.”

3.3. Neither Party shall use the trademarks, brand names, logos and identifiers, or

service marks of the other Party without the other Party’s prior

written consent.”

3.4. Companies One and Two shall be granted the right of first refusal to market

and distribute products developed at the center.”

18

3.5. Company One shall have exclusivity rights to market a product developed by

the AJWCC within the Philippines for a period of six (6) months

from the time ____acquires the right to market the product from the

AJWCC under such terms and conditions as may be approved by

the Parties hereto.”

3.5.1. Only such products as developed using the hardware and/or software

donated by ___and ____ and through accessing the network

connectivity provided by Company Two shall be deemed as developed

at the AJWCC. Only such products shall be covered by _____ right

of first refusal and exclusivity rights.”

3.6. Company Two right of first refusal and exclusivity rights shall not apply to the

marketing and distribution of the AJWCC’s products in

international markets. ATENEO shall have the freedom to engage in

projects meant to be distributed in international markets, as well as to

market and distribute products in international markets even if Company

has been granted exclusivity to market these products in the

Philippines.”

3.7. ____right of first refusal shall apply while the MOA is in effect.

In the same university, a contract for research on (item-confidential) was made with the faculty

members directly with private company. Unfortunately, the intellectual property rights of the

researchers were not protected in this particular agreement. The researchers were not keen in

analyzing first the extent of their research activities to be provided to the industry. In fact, the

company outrightly informed the faculty member/researcher that the technology being worked

on is patented. However, in the course of the research undertaking, a new technology was

produced. The company applied immediately for a patent under his name and later

commercially produced the product. The researchers did not know that a new idea was created

and very useful for the company. Hereon, the researchers will be careful in entering into an

agreement with any company of similar nature.

The University of the Philippines have entered into partnership under the aegis of the

Department of Science and Technology (DOST) with a pharmaceutical company adopted the

research results supported by the DOST and undertaken by the UP researchers. A “Licence

19

Agreement” between the Philippine Council for Health Research and Development

(PCHRD)/DOST and Pharmaceutical Company One, on the production technology for Lagundi

Pediatric Syrup as cough remedy and for the control of asthma. The pertinent provisions of the

agreement, to quote:

“Article 2 – License Grant” , 2.01 Licensor hereby grants to Licensee, subject to the terms and

conditions of this Agreement, a non-exclusive license to make, have made and use,

Licensed Product in Licensed Sales Territory. Nothing in this paragraph shall

preclude the inventors from using the Technology for their own personal and

professional research. If the Licensee generated New Improvement, title to new

Improvement shall vest with both Licensor and Licensee. Licensee shall have the

right to use and exercise such New Improvement in Licensed Territory provided

the original royalty arrangement shall continue as stated in the license agreement or

during the effectivity of this agreement and provided further that if the New

Improvement adversely affects in any way the safety, efficacy, or quality of the drug

products, any evidence or proof of the safety, efficacy, or quality of the original

formulation of the drug product as discovered by the Licensor cannot be invoked

or otherwise relied upon in favor of the New Improvement.”

“Particulars to be notified by the Party shall include chemical and physical data,

assay method/s and results, method/s of manufacturing and compounding, method/s

of analysis, as well as pharmacologic and clinical data.”

“The offeree shall have three (#) months from the date of such offer to declare

his or her acceptance of the same.”

4.02 Licensee shall have, under Most Favored Terms, the right of first refusal to

license New Improvement developed by Licensor.”

In addition, the technology on Herba Buena , Samboug and Lagundi were licensed to a

Pharmaceutical Company Two. Aside from the earlier Pharmaceutical Company, Sambong

Tablet and Lagundi Tablet were licensed to another Pharmaceutical Company T hree, making

three companies adopting the patented research results.

Another License Agreement is between a Corporation and PCHRD for the Vitamin A

Fortification. PCHRD have 5 patents and 16 applied for patents which are for health products or

devices.

20

In Mariano Marcos State University, four (4) patents pending for processing of bamboo

furniture, smoke fish/multipurpose dryer and electronics. At present, two (2) producers and

furniture exporters of Ilocos Norte are using their developed equipment and production

technologies. The agreement was considered as a special case as it is awaiting for the Board of

Regents on the approval of their IPR policy.

Another state university, Western Mindanao State University has a linkage in testing their

research products on wood board with a corporation. The industry counterpart is the use of their

company equipment while all the R & D expenses were from the funds of the university. IPR

was given importance in this arrangement. It is observed the University do not have an IPR

policy to guide the researcher and the university in protecting their intellectual property rights.

Leyte State University established partnership in terms of consultancy and R & D with car

manufacturer for the potential use of abaca as car parts; Company Y for the development of

stove using coconut oil as fuel; PALS for wide-scale planting of VISCA “makapuno” (mutant

coconut) in RIARCS; and Triple A Plantech for the use of “ube” (violet root crop) mass

propagation protocol with minimal counterpart. The inventor is thinking that inasmuch as

university fund was used in the creation of the above products, it should be shared without cost

to the recipient.

Bulacan State University has a number of university spawned venture and businesses. Example

of these are the Agreement between the Intercoastal International Technologies Corporation and

Bosch Rexroth Pte, Ltd./Bosch Rexroth Service Automation Didactic for an education center and

the industry provided the equipment for training. This is known as the Bosch Rexroth Training

Center. Another agreement is with SMART communications, Inc., again this is for training

purposes and the industry is providing the equipment. Another agreement is with the Bulacan

Chamber of Commerce and Industry for placing students in the different industrial or

manufacturing plants for their practicum which is part of their school requirements. There is IPR

being protected in the arrangements made by the university and the private company.

San Carlos has industry partnership in terms of research projects that were financially supported

by the industry, such as the corn chips, wastewater management for Prifoods Inc.; Wastewater

Treatment for General Milling Corporation; Systems Study and Logistics Assessment for the

21

Red Ribbon Bakeshop at Cebu; SOx/Nox Evaluation of Metro Cebu Airshed in Collaboration

with PCAPI-7 Kitakyushu; Wastewater Treatment for Mango Processing Industry with support

of 7-D Mango Processing Plant; Evaluation of the TOC, COD/BOD Levels of Various

Industrial Wastewaters at Different Process Points funded by the SHIMDZU Equipment

Corporation; and update of Topographic Map of Valencia, Bohol Mining Area for the Philippine

Mining Corporation. Aside from the above-mentioned partnerships the students were allowed

on the job-training for at least three (3) months for other engineering courses and as long as one

(1) year for the manufacturing engineering course. For the sciences, the in-service training is on

a case to case basis. Some generous industries extend transportation allowance or so-called

apprentice salary. The intellectual properties rights are not defined in the research project

undertaken by the university for the industry.

Far Eastern University have industry linkage primarily for the placement of on-the-job training

of students as part of their curriculum and this is coordinated by the office known as the

“Academe-Industry Program”. This program does not engaged in licensing technology. The

office is specifically for on-the- job-training of students coming from the engineering courses

only.

Aside from the industry linkages most of the universities have linkages with other foreign

colleges and universities, like, exchange of faculty members and students, joint or cooperative

projects. Unfortunately, in foreign cooperative research, the IPR ownership is not defined and

the researchers are not protected. The IPR issue should be given immediate attention by all

universities to protect the intellectual property rights of the faculty members and of the

institutions.

Administrative and Organizational Set-up for Management of University-

Industry Partnership

The University of the Philippines at Diliman, is at the moment the only University that have

established an Technology Transfer Unit in 1995 under the Office of the Vice-President for

Planning of the UP System. In May 1997, the UP Board of Regents created the University

Intellectual Property Office under Office of the Vice President for Planning and Development to

22

operationalize and application of the policy. In September 1998, the UP Board of Regents

approved the creation of the Office of the Vice-Chancellor for Research and Development at UP-

Diliman. The task of this office particularly at Diliman campus is to undertake R&D activities in

the protection, licensing patenting and/or copyrighting of their work as well as in the marketing

thereof and for the this purpose, to coordinate with the University Intellectual Property

Office(UIPO). Again, due to the non-operational of the UIPO and implementation of the

previous issuances, the Board of Regents in August 2000 created the position of Technology

Licensing Officer to accelerate the implementation of the policies enunciated and to have person

in-charge of the activity. Due to recent developments, the previous policy has to be updated, so

last May 30, 2004, the UP Board of Regents approved in principle, an improved version of the

Policies on Intellectual Property Rights of the University of the Philippines and the creation of

the Technology Licensing Office. In the meantime the “Policy on Intellectual Property Rights”

is still under review by the UP-System. And in line with the consultation, a primer has to be

prepared for distribution to all the faculty members of the UP system.

At the College of Engineering at Diliman, an “Academe-Industry Program” is existing for the

internship of the students in the industrial plant as an elective subject. This type of partnership is

done under a Memorandum of Agreement and is supervised by the College of Engineering and

assisted by the DOST. At UP at the Visayas, the concerns on partnership is made with the UP

Chancellor, the college concerned and with the industry but claimed to be an informal set-up.

The consciousness of IPR at University at Los Banos started in the 1990’s to have IPR unit

under the Office of the Vice-Chancellor. It is a one-man office as the person in-charge

coordinates with the different Colleges on the aspect of protecting the intellectual property rights

of the university and the researchers.

The different activities at the UP-System in partnership with the industry is done on a case to

case basis until such time that the IPR policies is accepted and approved for the whole UP-

System.

The University of Santo Tomas have an internal policy for intellectual property rights but not a

formal administrative and organizational set-up. Other universities are just beginning to discuss

the need for an intellectual property rights policy. Thus, the prevailing practice in the

universities in entering into partnership with the industry is done on a case to case basis.

23

The De La Salle University (DLSU) has the “Academe-Industry Linkage Unit” that takes care of

the placement of students in the different industrial firms. The students have to complete 480

hours for the other engineering courses while for manufacturing engineering they have to be

interned in an industry for one year or 1440 hours. Another office is the “Center for Engineering

and Sustainable Development Research” which will be in charge of resource generation and in

undertaking different types of researches. The DLSU is contemplating to have the Academe-

Industry Unit under the umbrella of the Center in the near future.

In addition to the above activities of the De La Salle University, the concern to protect the

intellectual property of the institution and the faculty members, it has finalized their IPR policy

which was approved in September 2004 by the Council of Deans. The Intellectual Property

Policy will be implemented by an Intellectual Property Committee (IPC).

At the Far Eastern University, an “Academe-Industry Office” is established and headed by a

Director. The Office at the moment is focused in negotiating for the internship of the students.

However, consultancy is done on a personal basis.

Except, UP and DLSU, the survey of the prestigious universities and institutions showed lack of

formal office for intellectual property concerns. Informal approach in dealing with university-

industry partnership is being practiced in most of the universities.

The Leyte State University known before as the Visayas College of Agriculture, has its unit for

university-industry partnership which is focused on the internship of the students and once in a

while on the intellectual property output of the faculty members. Missing is an IPR policy.

At the University of San Carlos, the dean’s office is used as the informal set-up to coordinate

S&T activities including those with intellectual property rights potential. Presently, IPR policy

is not existing.

The Philippine Council for Industry and Energy Research Development (PCIERD)/DOST of the

Department of Science and Technology assisted the universities to establish the so-called

“Academe-Industry Linkage Program”. The objective of this program is to link the academe to

the industry in terms of on-the-job training, discuss and identify problems of the industry that

24

may be a subject of research by the faculty and students together with the technical people of the

industry. And also, to expose the faculty and students to the operation of the industry, thus the

members of the faculty could incorporate the new knowledge/experience to their lectures.

Institutions that have the program are the UP System, UST and Mapua Institute of Technology

(MIT). However, this program has been replaced by setting up 9 industry and energy consortia

in the different regions of the country to assist the universities and colleges in working together

with the industry and non government organizations. The consortia is supported financially by

the DOST for operations in the amount of P200,000.00 a year per consortium. Aside from such

support, the institutions may submit research proposals for financial assistance. The grant for

research project proposal extended depends upon the scope of activities and should be in

accordance with the S & T priorities plan.

Most of the universities have an academe-industry linkage but there is no formal unit to handle

such activity. It is not formally organized except for those mentioned earlier. Furthermore, the

industry partnership is usually on the application or development activity only, e.g. Testing

stage. Research projects are jointly undertaken with industry.

The university faculty is allowed to undertake research as one of their mandate, other than

teaching and extension work. The time allocated for research will depend upon the university. In

some State and Private Universities, the faculty members undertaking research may be deloaded

of their teaching units depending on the policy of the academe. Some State Universities, the

faculty member undertaking research should maintain a teaching load of 6 to 12 units and the

rest of her time can be devoted to research. While in the private university, as an example, the

DLSU faculty member has to maintain a teaching load of 6 units per trimester and 6 units for

research activities per trimester, making a total 12 units which is the total academic load.or

equivalent to full teaching load. In San Carlos University, the faculty member can be deloaded

fifty percent of teaching load but the equivalent salary will be charged to the project. However,

if deloading is less that fifty percent of the regular teaching load, the salary is charged to the

regular compensation scheme of the university.

To name some universities that allow reduction of teaching units when undertaking research are

as follows: De La Salle University, University of Santo Tomas, Ateneo de Manila University,

Xavier University, Christian Philippine University, University of San Carlos, Siliman University

25

and others. Deloading (reduction of regular teaching load), is extended the faculty members to

entice the faculty members to undertake research and not just be full time teaching faculty as one

of the mandate of the university other than to teach, do research and extension work. With

exposure to research, the faculty member will appreciate further the theories being taught and are

forced to read on the recent developments on the subject area chosen. Linkages with other

faculty members from internal and external institutions will be enhanced the teaching capability

and strengthen cooperation with others.

With regards to the sharing of royalties, there is a general rule that was formulated by the

Department of Science and Technology. This is included in the Implementing Rules and

Regulation (IRR) of the Magna Carta for Scientists, Engineers, Researchers and other Science

and Technology Personnel under Republic Act no. 8439 approved on February 4, 1998. The

pertinent provision of the IRR, to quote: Section 4, paragraph 4.3, “S & T personnel shall be

entitled to receive share in royalties subject to the Guidelines of the Department. The share in

royalties shall be on a sixty (60%) to forty (40%) percent basis in favour of the Government and

the personnel involved in the technology/activity if produced or undertaken during the regular

performance of their functions.” Paragraph 4.4, involves private company and to quote the rule

as follows, “ If the researcher works with a private company the program of activities to be

undertaken has to be mutually agreed upon by the parties concerned, any royalty arising there

from shall be divided according to the equity share in the research project.”

Recently, a Memorandum of Agreement was entered into by the DOST, research/inventor and

the University of the Philippines with the agreed sharing of the benefits to be derived from the

commercialization of the project were as follows: 40% for the research/inventor, 40% for the

funding agency and 20% for the University of the Philippines.

On the other hand, at the De La Salle University, the policy is that the inventor/creator will get

not lower than 20% but not higher than 80% of the net revenues. From this, it is observed that

the private universities have their own system of renumeration and does not follow the DOST

system. This is true if the funding source is from the university.

As most of the research funds come from the Government, the DOST policy on sharing of

benefits have to be adopted by research/inventor that avails such funds. However, in some

26

instances the academe may have some special arrangements that have to be agreed by both

parties.

Releasing of information from research results with government funding will have to follow the

DOST scheme which is embodied in the memorandum of agreement entered into by the

researcher/inventor. And the manner of releasing information will be with mutual consent of the

parties involved. However, if it is a contract research with total funds coming from the industry,

the release of information will not be without the permission of the contractor. Furthermore, if

both parties have an equity in the project/invention, the release of information is subject to

mutual agreement.

In case the invention is to be applied for a patent, generally the name of the faculty member will

appear on the application form as provided for in the Intellectual Property Code (IPC) and

assignment of rights maybe extended to the Funding Agency. If the project is funded by the

University or Industry the patent may be assigned to the University or Industry depending upon

the agreement of the parties. The IPO Code recognizes only the individual as inventor and not

the corporation to be named in the application for a patent. Thus, in some cases, when the

university is not vigilant in monitoring the application of an invention for a patent by the faculty

member, the assignment to the university may be excluded in the application form. If this

happens, the faculty member can negotiate and enter into a commercialization agreement with

other party without the knowledge of the University.

It may be mentioned that the state universities has it own charter as provided in the law creating

the same and are autonomous. However, the said universities are monitored by the Commission

of Higher Education (CHED). The Commissioner of CHED, chairs the Board of Trustees of the

state universities as mandated in their charter and in the CHED Charter too. Recently, CHED

formed a team to evaluate the feasibility of corporization of state universities and colleges. Final

decision may come out next year, 2006. If the corporization of the state universities and colleges

will happen, the heads of these institutions my adopt the Bayh-Dole Act of the United States

were the academic institutions can own a patent as an output of research by faculty members.

With this privilege, the university can apply directly for a patent and have it offers to the private

company for commercial production. Now every effort should be made to have a legislation

similar to Bayh-Dole Act.

27

Sources of Funds

In a recent paper, entitled: “Study on the Feasibility of Establishing IP-Related Business

Development Services Hubs in ASEAN, Philippines”, prepared by Undersecretary F de la Pena,

DOST. Eight (8) universities were surveyed, two (2) private and six (6) state universities, it

was reported for the year, 2002, 2003 and 2004 that the level of R & Expenditures not identified

whether private or state university spends P101 to 500 Thousand Pesos for one university for the

3 years period; P501 Thousand to P1 Million Pesos, for two (2) universities in year 2002, one

university in year 2003; P1 Million to P5 Million Pesos, one(1) university for year 2002, two (2)

universities for year 2003 and two (2) universities for year 2004; P5 Million to P10 Million,

two (2) universities for year 2002, two universities for 2003 and four (4) universities for year

2004 and lastly, P10 Million to P50 Million Pesos, only one (1) university for years 2002, 2003

and 2004. Unfortunately this report did not include the sources of funds for the indicated

expenditures

Another source of information on R&D expenditures, the “Improving the Philippine Research

and Development Statistical System” from DOST as of March 4, 2005, in cooperation with the

National Statistical Office, produced the data on “R & D Expenditures in Higher Education by

Socio-Economic Objective, Expenditure Item and funding Source, 2002” as shown in Table 1.

Table 1

R & D Expenditures in Higher Education Sector by Socio-Economic Objective

Expenditure Item and Funding

(in Thousand Pesos)

Classification Amount % PublicHEIs

PrivateHEI s

28

Total R & D Expenditures 762,509 I00.00 643,541 118.968

By Socio-Economic Objectives: Exploration and exploitation of the earth Infrastructure and general planning land use Control and care of the environment Protection and improvement of human health Production, distribution & rational utilization Of energy Agricultural production and technology Industrial production and technology Social structures and relationships Exploration and exploitation of space Defense Access to information & knowledge

15,2669,034

99,965157,680

2,040281,39851,379

106,726

1538,967

2.001.1813.1120.68

0.2736.90 6.7414.00

5.1

15,143 8,89489,712106,259

1,971278,16939,42076,826

27,108

123 14010,25351,421

693,229

11,95929.900

1511,859

By Expenditure Item: Personal Services Maintenance and Operating Expenses Capital Outlays Others, n.e.c.

278,300238,983163,10782,120

36.5031.3421.3910.77

232,147202,144135,41673.835

46.15336,83927.6918.285

By Funding Source: Institutions’ Own Funds Government/Other Government Funds Private/Other Private Funds Foreign Funds Other Sources Not elsewhere classified

338,474299,027 33,371153,165 8,400 73

44.3930.03 4.3820.08 1.10 0.01

276,879218,971 17,449122,508 7,661 73

61,59510,05615,92215,922 739------

Table 1, indicates that the government sector HEI and public higher education expenditures is

about 85% as compared with the private sector of 15 %. The private HEI sector should increase

their share of the R & D expenditures in order to improve their research and development

activities at the same time improve the teaching capability of the faculty members. It is a chance

for the faculty members who earned graduate degrees to continue their research activities that

they have started during their studies. Using their expertise, the faculty member may be tapped to

assist in the economic development of the country and give the faculty member a sense of

fulfilment.

29

The funds for research and development (R & D) in the public universities come from their

university budget which may range from 1%

to 10% of their budget allocation. In 2004, the average research budget of the 113 state colleges

and universities is 3.61% or P58,748,000.00 based on the total budget of P1,627,289.000.00.

The research budget is not itemized according to basic, applied and developmental. To increase

the budget of the university, out sourcing have to be resorted too. Funds may come from the

industry or private sector in terms of contract research and development or donation. However,

if the research is purely research or developmental, the industry is not inclined to extend any

counterpart funds. The industry will only extend financial assistance if the research project is in

the applied or developmental level, like testing or pilot plant stage but still the counterpart is

very minimal or comes in the form of existing equipment and facilities and their limited

personnel.

Other sources of funds are from foreign funding agencies, like the Asian Bank, World Bank, the

European Community, UN bodies, like the UNIDO, UNDP, UNICEP, UNCTAD and others,

different western counties. Funding may be availed by conducting cooperative or joint research.

The Philippines has tapped the Japanese government for cooperative and joint research thru the

JICA and the JSPS and other Japanese funding agencies, public and private.

The industry sector claims to have spent for research in their respective companies a big sum of

money as shown in Table 2. This is the result of a survey made by the Private Business Sector as

reported in the Annual Survey of Philippine Business and Industry (ASPBI), “the private

business sector incurred an estimated R & D expenditures in a total amount of P2,634.1 million.”

“This figure was extrapolated from the R & D expenditure data generated by the National

Statistics Office through the ASPBI. The ASPBI R&D expenditure data does not include the

education sector. The R&D expenditure data are as follows:

Table 2

R&D Expenditures of the Private Business Sector

As Reported in the Annual Survey of Philippine Business and Industry

Year R&D Expenditure (in thousand Pesos) 1996 1,353.7

30

1997 1,389.6 1998 1,677.2 1999 1,832.4 2000 2.015.7* 2001 2,594.1* Estimated as the ASPBI was not conducted in this year

Source: Paper by Mr. Bernie S. Justimbaste, Director for Planning and Evaluation Service, DOST

The expenditures indicated in Table 2 cannot be said to be purely R&D as in previous surveys,

quality control expenditures were included. Furthermore, R &D projects that are to be conducted

by the university in partnership with the private firm, hardly will the firm extend actual cash

outlay. The private sector counterpart may include the existing capital outlay in the form of

equipment and the full salary of company personnel.

With regards to the National R&D Expenditures, the reported amount of P4.5 million was spent

in 2002, an increased compared with the 1996 expenditures of P4.1 million. In the case of the

government, the R&D spending levels decreased due to fiscal constraints. However,

surprisingly, the private business and private higher education sectors had significantly increased

their R&D expenditures as shown in Table 3.

Table 3

National R&D Expenditures by Sector, 1992, 1996 and 2002

(in million pesos/ current prices)

Sector 1992 1996 2002

All Sectors 2,940.5 4,144.9 4,493.9

Government 1,728.3 1,909.7 975.6

31

Higher EducationPubic HEIs

Private HEIs

433.2360.472.8

654.5573.181.4

762.5643.5119.0

Private Non-Profit 136.9 227.0 121.7

Private Business 642.1 1,353.7 2,634.1

With the reported government expenditures, it is expected that some of the research results

maybe considered patentable. While expenditures for R&D has increased, the list of patents at

the IPO-Phils from the universities and colleges have not increased.

It is high time that an evaluation of the research and development activities of the government

and non-governmental research institutes and academic institutions should be undertaken. The

researcher, scientist and technologist may not be aware that some of their research outputs are

patentable which should have been applied for a patent. The research/scientist/technologist may

think that what they have done is so simple that it does not merit to be patented.

In order to accelerate and give importance to R&D, the different public and private higher

education institutions in the whole country were clustered by CHED into 9 clusters and are

called Center for Research Coordination (CRC). The lead university appoints a director who in

turn coordinates and overseas the universities and colleges included in the cluster. The

Commission on Higher Education (CHED) is extending a grant of P3 million for each of the

CRCs. Besides the CRCs, CHED has identified Centers of Excellence (COE) for a particular

area and/or Centers for Development (COD). The COEs are units in the universities that have

the qualified manpower, facilities, infrastructure and other requirements to undertake research

and development. The university may have more than one COE. CODs are units with potential

R & D capabilities and may eventually become a COE. In this case the manpower complement

is insufficient or that the higher graduate degree holders are still short of the number required or

the facilities are still wanting. Every three years, CHED extends a grant of P9 million for each

COE and P3 million for each COD. A university with more than one COE is entitled to a grant

of P9 million per COE every three years. However, in the case of the social sciences, a grant of

P1 million per COE/COD is extended every 3 years. The assistance extended by CHED is done

to entice the faculty members to be active in undertaking research and utilize their expertise to

help in the social and economic development of the country. Assistance to industries around or

32

nearby the university will improve the production system of the company. At the present, there

is no report of any invention that has been applied for by any of the Centers of Excellence.

Another source of funds tapped by the universities, public and private for research and

development is the Department of Science and Technology (DOST) that extend grants to

selected institutions that submit project proposals that are in consonance to the National Science

and Technology Plan of 2002-2020. The financial assistance extended depends upon the scope

of the work and other criteria set by the DOST. The five (5) Councils of the DOST are sources

of research fund and for commercialization on a limited scale, namely: Philippine Council for

Industry and Energy Research and Development (PCIERD), the Philippine Council for Health

Research and Development (PCHRD), the Philippine Council for Advance Science and

Technology Research and Development (PCASTRD), the Philippine Council for Agriculture and

Natural Resources Research and Development (PCARRD), and the Philippine Council for Aqua

Marine Research and Development (PCAMRD). In addition to the five Councils, the

Technology Assistance and Promotion Institute (TAPI) another service agency of DOST can

extend financial assistance to inventor-researcher; and the Philippine Nuclear Research Institute

(PNRI) DOST, have budget for research grants too. The universities may also submit proposals

for financial assistance from the Department of Agriculture (DA), specifically, the Bureau of

Agricultural Research (BAR), the Department of Environment and Natural Resources (DENR),

the Commission of Higher Education (CHED) Government and private foundations,

concessional loans from Development Bank of the Philippines (DBP), and other local

governments. Aside from the mentioned- offices, special studies not only for science and

technology but for social sciences are extended research funds, too. Foreign grants for

cooperative, joint projects and other modes of research arrangements are available provided the

project proposal is in line with the priority area of the funding foreign country.

In commercializing matured technologies, the Development Bank of the Philippines (DBP) has a

window for such activity. This includes venture capital for projects that are viable. Thus,

financial requirement of the University-Industry Partnership may come from external and

internal sources. Parties involved in commercialization of technology will indicate their

contributions or so-called counterparts. The amount required by the project will depend upon the

scope of work to be undertaken. However, in the early stage of research and development, it is

the government that extends the required fund as the industry avoids supporting such stage of

33

research activity. It may be said that the industries in the Philippines look at research and

development as an expense and not as an investment or insurance that may result to bountiful

benefits in the future.

Another window the university and industry can tap for funds provided the technology is

patented is the fund administered by the Technology Assistance and Promotion Institute

(TAPI)/DOST known as the “Inventors Fund”. This program was created under an “An Act

Providing Incentives to Filipino Inventors and Expanding the Functions of the Technology

Application and Promotion Institute Appropriating Funds Therefore, and for other Purposes”,

which is Republic Act No.7459, approved on April 28, 1992 (Annex “C”). The purpose of this

fund is to grant incentives and financial assistance to the inventors for development provided a

project proposal is submitted to support the request.

To assist the inventors, individuals and academe on their major problem of capital requirements

for commercializing of their inventions, the then National Science Development Board (NSDB),

now the Department of Science and Technology (DOST) worked out with the Development

Bank of the Philippines an Inventors Guarantee Loan wherein the then NSDB has to guarantee

the loan up to 85%. This loan fund program is still open for use by the inventor. A number of

inventors took advantage of the window offered by the Development Bank of the Philippines

provided the invention is patented. Unfortunately, the researchers, scientists and technologists

from the universities did not take advantage of this facility at that time, as the researchers are not

risk takers like the private inventors. .

Venture Financing Program was established by some private group with the objective to assist

and accelerate the commercialization of new technologies by providing the necessary package of

funding support for start-up projects to full commercial loans from financing institutions. The

private inventor is more incline to avail the government resources rather than tap the private

basket of finance program.

A new program of the Department of Science and Technology that was initiated in February

2003 is known as Technology Incubation for Commercialization (TECHNICOM). “This

program is designed as a technology transfer program that seeks to identify key technological

breakthroughs that have excellent commercial potential. The program will follow the principle of

34

laboratory to shelf approach in providing support for the commercialization of research output

and innovations. It will focus on the stimulation of technological innovation; strengthening the

capacity of Small and Medium Enterprises (SMEs) in R&D activities; increasing private sector

adoption and commercialization of government initiated R&D break-throughs; and maximizing

benefits from government investments in R&D activities.”(Technology Incubation for

Commercialization Program, DOST brochure). Jointly, the university researcher and the

industry adopting the technology can request for financial grant from the DOST. The approved

projects with private sector counterpart are mostly their existing capital outlay and personnel.

This program can extend assistance in protecting and processing the intellectual property rights

of the parties involved in this activity. The valuation, licensing and negotiation for any

technology transfer will be part of this program.

Most of the colleges and universities with the exception of some, have not taken into account in

generating funds out of their intellectual property assets that they possess which they could tap to

increase their financial resources and standing.

Success/Failure of University-Industry Partnerships

The partnership will be successful if parties are committed, transparent, and have thrust and

confidence with each other. Though they have full thrust with one another, a memorandum of

agreement should be entered into by the parties involved. Every detail of the task to be

undertaken should be stated clearly especially the ownership of the intellectual property rights

that may evolved in the future. The provisions of the agreement should specifically indicate the

sentiments of both parties. Generalities and vague provisions in the agreement should be

avoided.

The industries that are subsidiaries of foreign firms usually send their problems to their mother

company. This is disappointing as the local researchers are not given a chance to show their

technical capabilities. However, a handful of industries like Secura that consults the local

researchers for their problems and they were satisfied with the output. Thus, the industry is

gradually consulting the researchers and experts in the university and in other research agencies

and institutions. In order to have avoid conflict in the future, policies must be formulated

together with the implementing rules and regulations on intellectual property rights (IPR). With

35

firm IPR policy, any output from research is considered an asset for both the university and the

industry, especially when commercialized. Without any IPR policy the researcher, scientist and

technologist might be taken advantaged by other parties.

Aside from research partnership, the adjunct scheme is practiced by some academic institutes.

An example of this is the Mindanao State University-Iligan Institute of Technology (MSU-IIT)

has an agreement with the industrial companies in Iligan City where the engineers of the

different companies are made to teach at the institute during office hours and vice versa. This

practiced enhanced both the capabilities of the faculty members and the company engineers.

This adjunct appointment is a continuing project and is considered a successful partnership and

maybe made a model for other universities in tapping expertise of the industry technical

manpower.

Previously, there is low awareness by the researchers and technologists in applying for the

intellectual property (IPR) rights, thus, the low number of inventions registered in the Intellectual

Property Office. However, for about a two decades, the awareness for IPR application has

recently changed. An example of this change is at UPLB, where patents approved from 2000 to

present is 6 approved patents and 6 more filed for registration. The patents approved are not

necessarily a product of university-industry partnership. The testing of technology occurs in the

industrial plants.

Mention maybe made that the IPO-Phils is very active in promoting IPR by conducting seminars,

workshops and conference with international and local speakers in different place.

It may be cited that some of the obstacles identified by the 8 universities surveyed as reported in

the paper of USEC Fortunato T. de la Pena, previously mentioned are as follows (not in the

order of priority):

Preference for publication of research results over IPR

Lack of detailed policies on sharing fees and rewards (e.g. royalties, honorarium,

etc.

Lack/Limited knowledge of commercial opportunities and value of technology

Lack of funding for patent drafting and filing

36

Fear of disclosure

Unavailability of patent drafting service

No perceived value in patent filing IPR application.

The above-mentioned obstacles can be remedied by training the researcher and scientist in the

aspect of IPR and the system approach in dealing with the identified problems.

To fast track production of products, the educational institutions as part of the National Capital

Region of the Center for Research Coordination (CRC) of CHED formed a “Product

Development Group”, a consortium of experts from the different universities. The members of

the program will complement each other in order to complete studies at a short period by

approaching the problem in an interdisciplinary system.

It is not only the management structure that may spell success in making the university and

industry partnership successful but the most important factor is to build up a pool of highly

trained technical manpower. As earlier mentioned, the Philippines under the supervision of the

DOST launched the Engineering and Science and Education Program (ESEP) in 1992, a 5-year

program but extended and completed in year 2000. This was financed by the Philippine

Government with the support of the World Bank and the Japanese Government in cooperation

with the Department of Education, Culture and Sports (DECS) and the Commission on Higher

Education (CHED). Selected colleges and universities were identified to be improved in terms

of scholarships for graduate studies, local and foreign, research and teaching facilities, library

holdings and other requirements to produce quality research. Not only the higher education

group that was given attention but selected secondary schools in order to have good feeders for

the tertiary level of education with emphasis on math, physics, biology and chemistry.

Furthermore, the Management of Technology Graduate Course was initiated under ESEP in

1995 at UP Diliman. It is located at the Technology Management Center.

The bulk of the ESEP resources were allocated for the state-of-the-art laboratory equipment and

technical books to tertiary schools and universities in addition to the number of highly trained

scientific personnel as shown in Table 4.

Table 4

Engineering & Science Education Project (ESEP)

37

Status Report of Scholars as of December 2003

Engineering Sector Graduated On-Going Total

Overseas - PhD - MS

272

2-

292

Local PhD 17 22 39 Local Masters 202 11 213 MEng 270 42 312

Total 518 77 595Source: ESEP Final Report.

Aside from the above formal training, there are overseas training for 26 postgraduate (3 months

to 1 year); 21 post-doctoral for a period of one year; 20 post-doctoral for 2 months; 14 laboratory

technicians; 20 librarians and short training for high school teachers.

In order to ensure feeder for the tertiary level, teachers were also extended scholarship grant

under the Certificate /Diploma Program and Master of Arts in Teaching numbering 1121.

Training the teachers will surely improve the capabilities and qualities of the students.

Shown below is the status of the R&D personnel in the Philippines and in particular the scientists

and engineers. It can be observed in Table 5 that in 2002 the number of R&D personnel in the

Philippines has decreased dramatically and very alarming. The top management of the DOST

and CHED is trying their best improved the educational environment to retain the highly trained

personnel in the Philippines. This turn of event is affecting the state of R&D in the Philippines.

If the R&D personnel will move to the private sector, it is a good sign that the industry is

recognizing the importance of research and development. This means that the private sector with

the assistance of R&D personnel may improve productivity and be competitive. Since the highly

trained personnel are moving out of the country, it is slowing down the development of the

country. This is so, as the Philippines will continuously train and spend the bulk of the

Philippine budget for education, thus leaving little budget for industrial development activities.

It may be true that the overseas workers are transmitting their dollars to the country but this is

temporary. By sending our fully educated personnel to the developed countries, the more that

38

country will develop further and will not allot funds for education but instead invest it for further

industrial development.

Table 5

Comparative Number of Total R&D Personnel in the Philippine

By Sector, 1992, 1996 and 2002

Sectors 1992 1996 2002All Sectors 15.610 15,837 8,692

Government 6.065 6,591 3,054Higher Education

Public HEIsPrivate HEIs

6.9295,7201,209

8.0307.508522

4,0963.147949

Private Non-Profit 922 510 242Source: Paper entitled,: “Improving the Philippine Research and Development Statistical System”

Table 5 also shows the number of scientists and engineers in the Philippines. In this table, the

number of R&D in the government decreased by about 53% comparing the years 1996 to 2002.

While in the public higher education institutions (HEI) the R&D manpower increased in 1996

but decreased drastically in 2002 by 46 % while the private HEI in 1992, has a good number of

R&D personnel but decreased in 1996 by 57 % and picked up in 2002 by 45% compared to

1996.

Table 6

Comparative Number of Scientists and Engineers in the Philippines

By Sector, 1992, 1996 and 2002

Sector 1992 1996 2002All sectors 9,960 11,215 6,803

Government 4,121 4,740 2,336Higher Education

Public HEIs Private HEIs

4,472**

5,6455,250395

3,5163,516812

Private Non-Profit 576 385 131Private Business 791 445 820

* not available , Source: Paper entitled, “Improving the Phil. Research and Development Statistical System”

Table 6 shows the distribution of the R&D personnel in the government, higher education and

private non-profit sectors. This table attest to the fact that more scientists in the field of natural

sciences and agricultural sciences undertake research compared with those in the field of

engineering. The engineering group were encouraged to undertake research and cooperate with

39

the other disciplines to design the necessary equipment to be used in the production of whatever

product that are created by the scientists. The engineers are to do and assist in the conversion of

an idea to reality. Engineers should realize that better remuneration is in designing of industrial

plants. And the trend in engineering is designing small industrial plants instead of big ones.

Table 7

Number of R&D Personnel in Government, Higher Education and Private Non-Profit Sectors

By Full-time Equivalent, Position Category and Field of Research Work, 2002

Classification/Category GovernmentSector

Number %

Higher Education-

Number %

Private on-Profit Sector

Number %

Total R&D Personnel(head count)

3,054 100.0 4,096 100.0 242 100.0

R&D Personnel in Full- Time Equivalent

2,248 73.6 1,611 39.3 114

By Position CategoryScientists & Engineers

TechniciansAuxiliary Personnel

Not Classified

2,33425144324

76.58.214.50.8

3,5161643610.5

85.84.08.81.3

13147604

54.119.424.81.7

By Field of Research WorkNatural Sciences

Engineering and TechAgricultural Sciences

Medical SciencesSocial Sciences

HumanitiesOthers, n.e.c.

886499

1,3564825681

29.016.344.1.68.40.30.03

831431

1,302258

1.1081588

20.310.531.86.327.13.90.2

50384617874-

20.715.719.07.035.935..9

-Source: Paper entitled “Improving the Philippine Research and Development Statistical System

Almost half of the scientists and engineers of the total 2,334 are engaged in agricultural sciences.

This is not surprising as there were more PhD in the agricultural sciences followed by the natural

sciences group. The natural sciences group was developed next to agricultural sciences due to the

consortium of three universities that have the technical expertise, namely, University of the

Philippines, Ateneo de Manila University and De la Salle University. It allowed cross

registration of the students in order to complete their master or doctoral degrees. To complete

their dissertation, the sandwich course was also introduced. Sandwich course means that the

laboratory work and experimentation of the graduate student is done in a foreign university.

With this condition, the ESEP program was initiated to increase the number of engineers with

40

graduate degrees. Furthermore, this is the reason for the slow development in the field of

engineering in the country. Table 8 would attest to this statement.

Table 8

Number of Scientists and Engineers in government, Higher Education and Private Non-Profit

Sectors and by field of Research work, 2002

Field of Research Total % Total % Total % All Fields 2.336 100.0 3.516 100.0 131 100.0 Natural Sciences 678 29.0 723 20.6 18 13.7 Engineering & Technology 368 15.7 392 11.1 15 11.4 Agricultural Sciences 1,038 44.4 1,083 30.8 22 16.8 Medical Sciences 48 2.1 252 7.2 15 11.4 Social Sciences Humanities Not Classified

19671

8.40.30.04

9151447

26.04.10.2

583-

44.32.3-

Source: Paper entitled: “Improving the Philippine Research and Development Statistical System

The University and Industry partnership will be successful when there is mutual respect and

understanding between the parties involved. The government is very supportive to industry

especially in allowing the scientists, engineers , researchers and others to be detailed to the

private sector. This is provided in the Magna Carta, Republic Act No. 8439, approved on

December 22, 1997, particularly Section 11, to quote: “Detail to the Private Sector. – Provision

of existing laws notwithstanding, scientists, engineers, researchers and other S&T related

personnel who are employed on a regular basis in the government, whether or not they are

conferred any rank under the Scientific Career System, shall hereby be allowed secondment to

any private entity whenever such services are required. Provided, That the duration of such

service with a private entity shall not exceed one (1) year. Provided, further, that the detail or

secondment of said personnel will not hamper or adversely affect the operations or activities of

the originating office. Provided, finally, “That the head of the agency approves such detail or

secondment.” The details are provided in the Implementing Rules and Regulations that was

approved on February 4, 1998.

In addition to the enumerated trainings, there are scholarships grants extended by different

developed countries such as the USA , Japan, Australia, France, Germany, United Kingdom and

others in building up the technical manpower of the Philippines. The scholarship grants are for

41

tertiary, master and doctoral levels and also for specialized skills development that are needed in

the country.

UNIVERSITY MANDATE AND CONFLICTS OF INTEREST

The University mandate is to teach, undertake research and extension work. With these

functions, the faculty member should be able to balance their time to comply with the

requirements of the university. The priority is teaching but research must be given time too and

extra effort to reinforce their being an academician. Surely, there is no conflict of interest in this

task. Meanwhile, the relationship of the faculty member and the university with the industry

may create conflicts in some occasion and all parties should be transparent with one another.

Here are some instances were conflict of interest between the university mandate, the faculty

member and the industry may happened, to mention a few:

1. Confidentiality of information –

The disclosure of some information may happen when a faculty member is taken as a

consultant in a company whose research activity is the same or similar in nature to a

project paid by the university or another company. The faculty should not accept or

avoid such consultancy.

2. Use of students as worker in a research project contracted by faculty member -

It is a practice that faculty member accepts research project and use the student as their

assistants, who at the same time are doing their thesis or dissertation. The faculty

member may suggest the problem that is the subject of the contract research. If the

output is patentable, the student cannot submit the report as thesis requirement. If this

happens, the student assistant may not be able to graduate on time unless the student will

accept the fact that she was paid for her work in solving the problem. Unless, there is a

clear understanding between the faculty member and the graduate students from the start

of the project, problem may arise.

3. Time allocation for teaching and research -

Conflict may arise when the time given for research is more that what is allowed by

the university policy. The faculty member may devote more time in research to the

42

neglect of their primary obligation of teaching especially when they are recipient of

financial grants from funding agencies and institutions. With outside funding the faculty

will have additional benefits that may cause conflict with university policies if agreement

has not been made.

4. Consultancy -

Another area of conflict is in the extension work of the faculty member wherein the

activity may exceed the time allowed by the university to the detriment of teaching tasks.

This is true for some state universities, were the expertise of the faculty members are

being harnessed by the private sector and other firms that teaching activity is affected.

The extension work may redound to consultancy work giving more time to said activity

at the expense of the students. The university in this case should formulate a policy on

this matter. At UP at Los Banos, the Chancellor made a policy that faculty/experts

being harnessed and contracted out in Indonesia as individual or as a team should be

negotiated with the university, whether, local or foreign. This was done to protect the

academic requirements of teaching and to avoid that most of the faculty members are all

out for consultancy in foreign countries.

5. Purchasing materials, equipment and supplies and materials from relatives of the researcher -

When specifications of equipment, supplies and materials are made to suit the company

where the products can be purchased from suppliers who is related to the

researcher/scientists.

6. Equity in a company that was licensed out -

A researcher/inventor was able to license out and commercialize the invention to a

private company but at the same time bought some shares of said company.

7. Full funding was given by a private entity and the faculty member did not receive any

research load credit (reduction in teaching load) for the research, which was

conducted in the premises of the university. The faculty member has the obligation to

inform the university about the contract entered so negotiation can be made either to

deload the faculty member or just allow to conduct the research in the university premises

but pay for the use of the facilities and the utilities to be used. If ignored by the faculty

member, then conflict will arise.

8. Full funding from the industry and the faculty member received research load credit, but the

research was conducted out the university. The time allotted for the research activity

outside of the university should not be allowed without the knowledge of the university

43

as the schedule of classes may be disrupted. The consultancy may demand full

attention and time, neglecting the obligation to the university

9. The research was fully funded from the budget allocation of a state university -

If the policy is clear from the beginning, surely there will be no conflict. However, if the

faculty member forgets the obligation tied up with the grant, problem may ensue in

the case of sharing information to industry without permission of the university especially

if the output has some commercial value. Eventually the ownership of the intellectual

property has to be resolved.

10. Faculty members may undertake research that is not within the priority plan of the

university. Misunderstanding may arise in terms of time allotted and resources.

Moreover, the use of the facilities in the university may be one of the causes of the

problem.

Recommendations for improving the IPR in improving the University-

Partnership

1. The universities should have a better promotion of the capabilities, facilitates, and other

items that will give confidence to the industry to enter into a partnership.

Information brochure should be made specifying the strengths of the university and

the pool of highly trained manpower that can undertake R&D activities.

2. The universities should establish an office for Technology Licensing or Technology

Transfer Office (broader in scope and mandate) to look after the evaluation,

negotiation and licensing of research results and/or intellectual property rights

patented. At the same time, a Technology Licensing Officer should also be

appointed. Furthermore, an organizational chart and flow of activities should be

made and disseminated to all the researchers for their information.

3. Formulate and/or strengthen the existing rules and regulations in intellectual property

rights policy governing the relationship of the university with the industry. Also,

policy that would indicate the relationship of the researcher with the

university/institution and among the researchers and technologists and student

assistants.

44

4. Before entering into a contract of services with the industry that holds a patent, the

researcher should review the patent and have a common point from where the

contracted services will be started and identify specifically the research to be

his item/ aspect should be indicated in the Memorandum of Agreement.

5. Minimize the faculty members in entering into a contract without the knowledge of the

university management.

6. Awareness campaign on intellectual property rights should be done regularly at the

university, that is, everyone must be educated/be informed on IPR.

7. With broad knowledge of the patents in the area of expertise of the researchers, they can

readily discuss things with their clients who would be impressed and eventually

convince the industry to contract their services.

8. Devise a mechanism to fast track the processing of the intellectual property rights at the

IPO-Phils.

9. Provide incentives to the university researchers who have a stake in the patent. Giving

incentives to the university researchers will make them more aggressive in

producing more patentable products, process, designs and others. This can be done

by deloading the faculty members of their teaching load but with full renumeration.

10. Strengthen the academe-industry linkage program or units formed in the university.

11. Have an interdisciplinary consortium of researchers and technologists from the different

universities to pool the different expertise to accelerate the production of products,

process, designs and others.

12. Researchers, scientists and technologists should protect their rights by being vigilant in

applying for an IPR and the culture of being protective of their intellectual property

should be ingrained to all the participants of research projects.

13. Maintain a critical pool of R & D experts that are dedicated to their research work in the

university and incentives for the researchers whose successful projects are

adopted by the industry.

14. Allow researchers in the university to work in the industry during their sabbatical leave

or any time convenient for the researcher provided it is within the

university policy which should be established.

15 Assist the researcher to put up their business using their research results and if they are

not successful they can return to their position in the university. A legislation

maybe enacted to this effect.

45

16. Convince and involve the industry from the beginning of a research project.

17. Accelerate the implementation of the Magna Carta for Scientists, Engineers, Researchers

and Other Science and Technology Personnel in Government and private

institutions.

18. The University should review their research results and identify those with potentials for

patent application and should be fast track.

19. The University management together with the faculty members should be aware of using

their IP assets in generating funds for their future activities.

20. The University management and faculty members should learn the art of valuation,

licensing and negotiation to derive the best benefits out of their IP assets. Training

in these aspects should be conducted for the university researcher and management

staff members.

21. The Bayh-Dole Act of the United States should be considered to be applied to the

universities especially when the corporarization of state colleges and universities

will come into reality. A similar legislation maybe enacted to make the

universities more aggressive in commercializing their intellectual property assets.

22. Strengthen and expand the mandate of the Technology Application and Promotion

Institute (TAPI) of the DOST in terms of increasing the budget allocation and to accelerate the

assistance to researcher-inventors, especially in the application for a patent and the payment of

the required fees. The PCT should be applied to inventions that need protections in other

countries which need financial assistance.

References/Bibliography

1. DOST (unpublished), “Integrated Report on National Survey of Scientific and Technological

Activities: 1989-1992”, Taguig, MM

2. DOST (unpublished), “Integrated Report on National Survey of Scientific and Technological

Activities: 1994-1996, Taguig.

3. “A DYK (Did You Know) Guide in Intellectual Property”

46

4. “Improving the Philippine Research and Development Statistical System by Mr. Bernie S

Justimbaste, Director of Planning and Evaluation Service, Department of Science

and Technology,

5. Commission of Higher Education list of colleges and universities with 2004 budget.

6. Republic Act No 8439, “An Act Providing a Magna Carta for Scientists, Engineers,

Researchers and other Science and Technology personnel in Government” and its

Implementing Rules and Regulations.

7. License Agreements from, University of Santo Tomas, Ateneo de Manila University, De

la Salle University, Department of Science and Technology, Bulacan State

University, University of the Philippines/Philippine Council for Health Research and

Development and others.

8. Intellectual property policies of de la Salle University, University of Santo Tomas, University

of the Philippines

9. DOST Memorandum Circular no. 001, Series of 2002

10. Final Report of the Engineering and Science Education Project

11. de la Pena, Fortunato, USEC, “Study on the Feasibility of Establishing IP-Related Business Development Services Hubs in ASEAN, Philippines” April 2005

12. National Science and Technology Plan, July 8, 2002 – 2020

13. Alabastro, Estrella F. “ Science and Technology” paper presented during the Third UP Public Lectures on the Philippine Presidency and Administration on February 27, 2004 at UP Diliman, Quezon City

47