University, Inc: The Corporate Corruption of Higher Education

  • Jennifer Washburn
Basic Books: 2005. 384 pp. $26, £19.99 0465090516 | ISBN: 0-465-09051-6

Money corrupts. It was ever thus, but the thesis of this important book is that the universities' current dependency on industrial links has reached a moral crisis point. Academic freedom, the book contends, has been severely compromised, with damage being done to the public and to the values of higher-education institutions. Here I must declare a conflict of interest, as I have been closely involved in creating spin-off companies and in a multimillion-pound deal to finance a state-of-the-art laboratory. Despite my possible bias in favour of technology transfer, University Inc. shakes one's confidence and provokes the realization that some things may have to change.

It is a scholarly book, with almost 700 references and footnotes. However, the author, journalist Jennifer Washburn, cannot resist irritating portraits of many of the major players, for example describing Clark Kerr as “a balding man with bushy white eyebrows and alert blue eyes”. It is written exclusively from the United States point of view, where for a long time there has been tension between a utilitarian view of universities, as expressed by Thomas Jefferson, who favoured “a useful American education”, and the élitist attitude more prevalent in older European-style institutions, such as Harvard University. Nevertheless, as colleges across the world try to emulate the success of their top US competitors, they are faced with the same dilemmas, encouraged by governments espousing the ‘knowledge economy’. Commercial values have been stamped on academic life.

Universities routinely run patenting and licensing operations, invest in risky start-ups, run their own industrial parks and venture-capital funds, and encourage their faculty to set up companies. But sponsorship brings the risk of ceding control, changing the direction of research and altering the priorities of universities, even to the extent of marginalizing the humanities.

Washburn examines in detail several well-publicized case histories, including an agreement between the University of California, Berkeley, and Novartis. The company gave the university $25 million over five years for first right to negotiate licences on roughly one-third of the discoveries in the Department of Plant and Microbial Biology. Washburn also takes a rather jaundiced view of the Institute for Bioengineering, Biotechnology and Quantitative Biomedicine (QB3) at Mission Bay, San Francisco — a cooperative effort among three campuses of the University of California and private industry.

The rise of the market-model university dates from the discovery of recombinant DNA technology by Stanley Cohen and Herbert Boyer in 1973 and its subsequent patenting. Washburn provides detailed scrutiny of what she considers the villain of the piece, the Bayh–Dole Act, signed into law by President Carter in December 1980. The bill seems to have been crafted originally to grant automatic patent rights to just universities and small businesses. It contained safeguards, such as a ‘march-in’ provision to enable the federal government to terminate licences, and time limits on exclusivity, but few of these survived to the final legislation. Major corporations did not lobby to oppose the act, which the Reagan administration soon extended to include them.

Since the 1980s, the desire to maximize entrepreneurial gains has grown, and they have become significant sources of university funds. DuPont gave $6 million to Harvard, and the German chemical company Hoechst provided $50 million for Massachusetts General Hospital — this was targeted money with expected tangible returns in terms of exclusive rights.

The most worrying questions, though, relate to clinical trials. Washburn recounts in detail the problems faced by James Kahn of the University of California, San Francisco, with a trial of the AIDS drug Remune, which was funded by the Immune Response Corporation, and the genetic-engineering trial at the University of Pennsylvania that resulted in the death of Jesse Gelsinger. No one can read these and other case histories in the book without considerable disquiet.

But what is to be done? Pandora's box is already open. We cannot turn back the clock and return to a community of lone scholars, each seeking truth. Modern research in most areas needs massive funding — more than even the richest governments can afford. It is totally unrealistic to place walls between academic institutions and private industry. Universities can, and must, contribute to scientific and technological innovation for wealth creation without compromising their core scholarly principles, academic freedom or essential autonomy. In my opinion, this is becoming even more important as industrial innovations are increasingly the product of small companies, often spun out from universities, while larger corporations concentrate on marketing and selling.

Washburn suggests four fundamental changes. First, she calls for the creation of an independent, third-party licensing body that would assume control over technology-transfer activities in the United States, perhaps allowing some of the more successful campuses to opt out. Second, she has the Bayh–Dole act firmly in her sights, and would have Congress revisit and revise it. In particular, she would change the language so exclusive licensing was the exception and not the norm. Furthermore, she wants the federal government to be able to intercede more easily to provide access to all taxpayer-funded research. The third reform, which would certainly be welcomed in most academic departments, would be to introduce strict conflict-of-interest laws, although the problems in laboratories at the US National Institutes of Health shows how even this might cause tensions. Finally, she would create a new federal agency to administer and monitor industry-sponsored clinical trials. The fact that there are stirrings in all of these directions suggests that she may well have identified the sensitive areas.

For the world outside the United States — particularly southeast Asia, where research is more related to health and wealth creation — there are lessons to be learned from this book. The financial imperatives need to be kept in check to avoid serious damage, not just to science but to people's lives.