Advanced Technology Program Challenges and Opportunities (1999) / Chapter Skim
Currently Skimming:
Panel II: Program Objectives
Panel II: Program Objectives
Pages 51-69
The Chapter Skim interface presents what we've algorithmically identified as the most significant single chunk of text within every page in the chapter.
Select key terms on the right to highlight them within pages of the chapter.
From page 51... ...
The Clinton Administration's Perspective The Clinton administration remains very interested in the program because of the spillovers that it generates for the economy. It is an enormously complex task to maximize the spillovers from R&D investment, but it is worth undertaking because the spillovers benefit not only other firms in the sector in which an ATP recipient operates, but also firms in the entire economy.
|
From page 52... ...
Moreover, in achieving a balanced portfolio of risks in R&D projects from relatively risky university research at the frontiers of new knowledge to less risky advances in industrial process the presence of the ATP has helped to spread that .
|
From page 53... ...
Third, many R&D challenges are so large or complex that no single company has the resources to address them alone. By stimulating industry investment in innovative technology with the potential for broad national benefit, government-industry partnerships, such as the ATP, address these sources of market failure.
|
From page 54... ...
The ATP looks for the broader perspective selecting projects that have the potential for broad-based economic benefits, not just direct benefits to a single company. If a proposal addresses path-changing technology, has potential for broad economic benefit beyond the innovator, and shows good evidence of a strong need for ATP funding, it is a good candidate for an ATP award.
|
From page 55... ...
Fourth, we see substantial job growth in our companiesin the first 38 projects, almost all of the small, single-applicant companies have at least doubled in size since they received their initial ATP award. To give you a flavor of the technical successes we are having, consider the following examples: Two small companies are developing miniaturized DNA analyzers that are greatly increasing the speed of research and medical testing for diseases such as HIV, strep infections, or cancer.
|
From page 56... ...
can be accomplished only by an effective partnership between the publicly funded effort and private enterprise. Development of new technologies is a particularly fertile area for such partnership efforts, and we have been delighted to work closely with NIST's Advanced Technology Program to help develop DNA Tools.
|
From page 57... ...
We also are supporting technology research to understand the fundamentals of how to miniaturize important biological assays such as polymerase chain reactions and DNA size separations and accomplish them on microfabricated devices. Additional research is proceeding on how to integrate multiple assay steps on single devices so that many samples can be analyzed in parallel, and sequentially, to achieve the high-throughput, cost-effective capabilities that are needed to take full advantage of genomic data.
|
From page 58... ...
The engineer described a complex sequence of development benchmarks and concluded that the project was challenging, but was the sort of thing that his team had accomplished successfully in several previous projects. The chemist pointed out that those projects had all involved sophisticated electronic, optical, mechanical, and software engineering, but that this one added analytical chemistry.
|
From page 59... ...
First, the value of Genome Project products increases because more people will gain access to the tools that allow them to take advantage of those products. Also, as the companies that are developing these products gain experience and build their infrastructure, they can turn part of their attention to solving the problems that will allow our grantees to extract from biological systems the next generation of genomic data.
|
From page 60... ...
At that point, there had never been an optic such as X-Ray Optical's manufactured in the United States; indeed, given the Soviet origins of the research, such an optical had never been in the United States. The company applied for ATP funding in 1990 and was turned down.
|
From page 61... ...
The company looked to private sources of funds, which is generally a good avenue to pursue. However, private sources, that is, individual wealthy "angel" investors, usually find it hard to assess highly technical risks such as the one that X-Ray Optical Systems presented.
|
From page 62... ...
Today, X-Ray Optical Systems is at a stage where it can reasonably expect to gain additional funds from a venture capitalist. The company is looking at various options for procuring financing from venture capitalists.
|
From page 63... ...
At his company, however, it is the task of the Honeywell Technology Center to look beyond the existing business units to anticipate technology needs 3 to 10 years into the future. When a Honeywell business unit wants to move swiftly into a new market, the Technology Center is there to ensure that the company has the technological capability to do so.
|
From page 64... ...
Information technology can improve the efficiency and quality of health care delivery to the elderly and generate substantial savings. For Honeywell, each of the ATP projects in which it participated involved a great deal of technical risk.
|
From page 65... ...
Axys has found the ATP to be a valuable program and, even though Axys received its grant only last fall, the company believes that the program is meeting the objectives set forth in the legislation. Axys and the ATP Axys Pharmaceuticals is a biotechnology company that qualifies as a small business; its primary corporate mission is to discover and develop small-molecule therapeutics that can be taken orally to treat diseases.
|
From page 66... ...
Under the current ATP rules, a single company cannot obtain financing for indirect costs associated with the projects; joint ventures can. Because indirect costs can run as high as 70 percent of total costs, there is substantial disincentive for individual companies to apply to the ATP.
|
From page 67... ...
For example, if a single company takes the lead in development and forms contractual relationships with other companies to further the development process, it may make sense to allow the lead company to substitute another company in the development chain if one of the original firms fails to hold up its part of the development bargain. If ATP's rules preclude this kind of substitution, necessary flexibility among firms is constrained.
|
From page 68... ...
When his company applied for its second round of ATP funds, the company knew that about 2.5 percent of single-company applicants that applied received funds, whereas that figure for joint venture applicants was approximately 12 percent. When X-Ray Optical gave its oral presentation to the ATP, a point in the application process at which roughly half the companies invited to give such presentations win funding, the company said that it was willing to go forward knowing that its chances of winning the award were lower as a single applicant.
|
From page 69... ...
Often, therefore, the ATP draws on retired business people and the best available academicians to review business plans. The ATP also makes sure that its outside experts have no conflicts of interest because the review process involves the disclosure of proprietary information.
|
Key Terms
This material may be derived from roughly machine-read images, and so is provided only to facilitate research.
More
information on Chapter Skim is available.