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4
Collaboration and Exchange
Now Under Way
OPTOELECTRONICS
The primary mechanism for the exchange of information and ideas between
Japan and the United States in the field of optoelectronics is the university. Many
U.S. universities hold workshops that are attended by both U.S. and Japanese
researchers. The University of Florida, for example, has held workshops on
advanced processing and characterization technology; the first was held in 1987,
the second in 1989 in Tokyo. There are also many exchanges between U.S. and
Japanese universities in which university professors spend sabbaticals at
university research laboratories in the other country.
There are a few instances of exchange activities that fall outside the more
common university-to-university pattern. Visits by Dr. James Merz (University
of California at Santa Barbara) to Japan's Optoelectronics Joint Research
Laboratory (OJL), an industry-based consortia under Ministry of International
Trade and Industry (MITI) sponsorship,17 are one example. A reciprocal visit
was made by Dr. Ikoma of the University of Tokyo, who spent August of 1989 at
the University of California at Santa Barbara as a distinguished visitor under
National Science Foundation sponsorship. The Research Center for Advanced
Science and Technology (RCAST) at the University of Tokyo has established
|7 OIL was an industry consortia of nine companies formed in 1981-1986 to develop technology
needed to fabricate an advanced fiber-optic-based local area network system. Mill partially funded
the project through its Electrotechnical Laboratory. See also Appendix A of this report.
18
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19
chairs for foreign professors. One individual on leave from AT&T is carrying out
research on advanced optical communications there.
In industry most U.S.-Japan collaboration in optoelectronics has been confined
to telecommunications. As an example, New and Bell Labs are cooperating on a
trans-Pacif~c cable. The fact that the bulk of research funding for optoelectronics
in the United States is generated by the U.S. Department of Defense has resulted
in "mission-oriented" research that falls generally outside the scope of
precompetitive research. Examples of collaboration in telecommunications
include the following:
· After the privatization of NTI in 1985, Mitsubishi joined with IBM and
Ford Aerospace to compete with NTT in communications services.
· AT&T joined with 18 Japanese firms, including Hitachi arid Fujitsu, to
form Japan ENS Corporation to provide specialized data communications
services. AT&T retained a controlling 50 percent interest in the venture.
· Mitsui established a joint venture with Hughes to provide tele-
communications service with Japan.
There has been some activity in computer-related research in optoelectronics.
IBM and Toshiba, for example, have recently announced a plan to jointly develop
a flat panel display.
BIOTECHNOLOGY18
Exchange between the United States and Japan in biotechnology at the
university level is more extensive than in optoelectronics. It takes the form of
workshops (such as the U.S.-Japan Workshop on Bioreactors at the California
Institute of Technology and the conferences organized at Lehigh University),
visits, and researcher exchanges.
In addition to university collaboration and the development of personal
contacts with researchers, there is a potential for foreign participation in Japanese
government-sponsored projects. International cooperation is a key objective of
such projects as the Human Frontiers Science Project, Exploratory Research for
Advanced Technology, the Protein Engineering Research Institute, and others.
However, in view of the reluctance of U.S. corporations to establish cooperative
R&D ventures in biotechnology, it seems unlikely that international R&D
18 Much of the information in this section is from Edward B. Roberts et al. "Inter-Finn Technological
Cooperation: The Case of Japanese Biotechnology," MIT Sloan School Worlcing Paper, July 1988.
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consortia will expand to resolve the asymmetries in access noted above.
Collaboration between the U.S. and Japanese corporate sectors in
biotechnology can be divided into four areas:
· Research contracts, in which firms receive exclusive licensing rights for
providing research funds.
· Licensing, which allows the licensee to market and/or produce a product in
its home country.
· Corporate alliances, including joint projects and joint ventures, in which
management and operation of the joint venture are performed by those who work
in that new venture with parent firms usually exerting strong influence.
· Acquisitions, in which one fun acquires another firm outright.
Longer-term research alliances and collaborative research agreements among
corporations that involve early-stage research require clearly defined intellectual
property rights. The partners must develop an understanding of patents and a
broader strategy. In view of the perceived differences and asymmetry in
enforcing respective patent rights, this is not an easy task.
Early in the biotechnology industry's development, the late 1970s to early
1980s, research contracts were plentiful. Young capital-hungry U.S.
biotechnology companies searched for research sponsors, and Japanese firms,
anxious to obtain access to new technology, searched for good research partners.
There were at least 188 such collaborations between 1980 and 1983.19 Due to
the secret nature of many such agreements, the exact number of research
contracts and joint research ventures is not known. It is believed, however, that
the rate of formation of such alliances is smaller today, because many developed
biotechnology firms realize the risk of revealing their technology to competitors.
Licensing has been and continues to be the most popular mode of interaction
between U.S. and Japanese biotechnology firms. Although it is difficult to find
data on the number of licensing agreements between the United States and Japan,
it is believed to be large. Most of the biotechnology firms and major
pharmaceutical firms have entered into such licensing agreements.
Japanese organizations appear to have licensed from the United States more
than U.S. organizations have from Japan. Edward B. Roberts, for example, lists
44 examples of licensing agreements with Japanese firms as licensees and only 6
with Japanese firms as licensers. The result is an asymmetry in access to R&D.
The quantity of licensing agreements does not, however, provide an adequate
basis to judge the nature of the technology being transferred. While important
technology may be transferred in this way, the technology being transferred
through licensing is not necessarily state of the art.
|9 "The High Tech Race: Who's Ahead-?" Fortune, Oct. 13, 1986, pp. 26-57.
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21
In the past, acquisitions and joint ventures have not been a major avenue for
U.S.-Japanese collaboration in biotechnology. Japanese firms may have wanted
joint ventures with U.S. biotechnology firms, but geography and intellectual
property considerations discouraged U.S. firms from participating. Japanese
firms reportedly were cautious about acquiring U.S. biotechnology start-ups in
the past, but the situation may be changing.20 Instead, many Japanese firms set up
their own U.S. laboratories. In a 1988 poll of Japanese firms, 87 were
considering establishing a U.S. lab and 27 had already done so.
More recently, however, there appear to be Increasing numbers of both joint
ventures between U.S. and Japanese funs in biotechnology and acquisitions of
U.S. biotechnology start-ups by Japanese firms. Acquisitions may be driven by a
slump in the biotechnology industry. According to one survey, three-quarters of
current biotechnology agreements between Japan and the United States were joint
ventures.21 Similarly, there have been recent reports that Japanese
pharmaceutical fops are relying less on licensing and more on joint ventures, in
addition to efforts to acquire small U.S. biotechnology start-ups.22 Ire 1988, 23
Japanese chemical, biotechnology, and venture capital firms went on tours of
biotechnology companies in Los Angeles, Houston, and New York to explore
possible purchases.23
20 Mamn Kenney, Biotechnology: The University-lndustry Complex, Yale University Press, New
Haven, Cain., 1986.
21 Lois S. Peters, Technical Network Between U.S. and Japanese Industry, Rensselaer Polytechnic
Institute, Troy, N.Y., March 1987.
22 Chris Messina, '$Rising Phannaceutical Force," High Technology Business, April 1989, p. 14.
23 '$Clouds Gather Over Biotech Dusty," The Wall Street Journal, J.=. 30, 1989, pp. B 1,3.
Representative terms from entire chapter:
joint ventures
