11/7/03

AU DOES FIRST VENTURE UNDER NEW TECH TRANSFER MODEL

AUBURN -- Auburn University has signed a licensing agreement formally launching its first commercial development venture under a new technology transfer model.

AETOS Technologies Inc., an Auburn-based firm, has joined with Auburn to commercialize and market a set of technologies developed by a team of researchers under the direction of Dr. Vitaly Vodyanoy in AU's College of Veterinary Medicine.

The first technology to be marketed under the agreement is an ultra high-resolution, dark field optical microscope that enables the observation of living cells in extremely fine detail and in real time.

"We believe that Dr. Vodyanoy's microscope has the potential to revolutionize the dark field optical microscope market, and will be the basis of a highly profitable company," says Chuck Ludwig, AETOS Technologies president and chief executive officer. "Moreover, we believe that this new business model -- closely conjoining the university and a commercial venture -- has the potential to significantly improve the way university technology transfer can be achieved and greatly enhance the value of its intellectual properties to the university."

Under the agreement signed Oct. 14, AU holds a minority ownership in AETOS Technologies, while accruing a major share in revenues generated.

"The model provides a means whereby the university can secure a higher return on its research developments that are commercialized," says AU Vice President for Research Michael Moriarty. "Auburn owns a 45 percent share in the company, but up to 60 percent of the revenues generated will flow back to the institution."

Development of the new technology transfer model began just under a year ago, following an AU technology showcase sponsored in Birmingham in November 2002 by the Office of the Vice President for Research and its Office of Technology Transfer.

"It was at this Auburn Day event that we first met Tom Lawrence, who has been instrumental in developing our new tech transfer model and in formulating this first business venture," said Jan Dowdle Thornton, OTT director.

Lawrence, a venture capitalist and business development consultant, says the new Auburn model is unique in that it provides a completely non-traditional approach to university technology transfer.

"Current university technology transfer has seldom been satisfactory to either the university or to commercial enterprise, Lawrence says. "Technologies developed through university research typically are funded by contracts and grants. Once the research is complete and the results are published, the technologies rarely have an opportunity for commercial exposure, and when they are licensed to a commercial developer, the university typically retains rights to a much lower return than what might be possible under a different process."

The new process -- dubbed the Auburn Model -- does not replace traditional technology transfer, Thornton says.

"The traditional tech transfer licensing process still will be used for many of the university's research developments," says Thornton. "However, when a technology is suitable for this new model, such as having extremely high commercial potential, we will pursue the formation of a venture company to develop and market the technology at a higher value to the university."

With the state of Alabama facing budget uncertainties in its current financial climate, AU President William F. Walker said the new Auburn technology transfer model is a promising and needed asset for higher education.

"The statešs colleges and universities must find ways to reduce costs and increase revenues if we are to continue offering top-quality educational programs and service to the state and region," Walker says. "This new technology transfer venture is exciting, and I look forward to its success and to future successes from other ventures of this nature."

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nov03:AU-aetos

CONTACT: Mitch Emmons, 334/844-5964.