Chapter VII. Technology Transfer
Army Science and Technology Master Plan (ASTMP 1997)

3. Army Domestic Technology Transfer (ADTT) Program

There is a long history of technology transfer from in-house Army R&D to commercial applications. For example, Army technologies form the basis for both the alkaline battery industry and the flexible-packaging industry for food preservation, which provide strong production bases for military needs. Today commercial sales of these items amount to many millions of dollars each year. Technology transfer has recently received increased emphasis within the Army, the Congress, and the current Administration as we have recognized the need to merge military and civilian technology and production bases to form a unified, strengthened, national capability. This policy helps maintain military capability in the face of decreasing funding and uses military resources to enhance national economic strength.

The initial formal requirement for technology transfer from federal laboratories was the Stevenson-Wydler Act of 1980 (15 USC 3701 et seq.). Its intent was to maximize the benefit of taxpayer investment in federal R&D. The Federal Technology Transfer Act of 1986 (Public Law 99-502) provided specific requirements, incentives, and authorities for federal laboratories to actively engage in technology transfer. It gave the director of each federal laboratory the authority to enter into Cooperative R&D Agreements (CRDAs) and to negotiate Patent License Agreements (PLAs) for inventions made at their laboratories. The National Technology Transfer and Advancement Act of 1995 (Public Law 104-113) amends these previous laws to provide additional incentives encouraging technology commercialization to both industry partners and federal laboratory inventors. This new law seeks to promote industry's prompt deployment of inventions created in a CRDA by guaranteeing the industry partner sufficient intellectual property rights to the invention and providing increased incentives and rewards to lab personnel who create new inventions.

CRDAs are only one of several tools used for technology transfer, but they are probably the most powerful. They make the technology, facilities, and people of Army laboratories available to a commercial partner at an early stage of development; provide a direct benefit to the Army's mission from the partner's effort; and perhaps most importantly, encourage direct interpersonal communication between scientists and engineers of the two sectors. These relationships had been discouraged in a Cold War defense culture separated by rules and customs from the larger technical culture, and an important task of the ADTT program is to overcome this culture gap.

PLAs are an important mechanism for commercializing inventions developed in Army labs. Each lab maintains a collection of patents developed by its scientists and engineers and markets those with potential commercial application. When licensed and commercialized, these inventions benefit consumers with new or improved products and increase the Nation's economic strength. Royalties are shared by the inventors (who receive the first $2,000 and thereafter 20 percent of royalties received) and the lab (which keeps most of the remainder). This reward structure provides a strong incentive for commercialization, which is beginning to change the behavior of both individual inventors and lab management. Responding to this increased interest in the labs and increased recognition of the importance of spin-off by Congress and the Administration, the ADTT program is initiating more aggressive marketing strategies to increase patent licensing.

The Construction Productivity Advancement Research (CPAR) Program is a cost-shared, collaborative R&D partnership between the U.S. construction industry and the Corps of Engineers. The Program is designed to enhance construction industry productivity and innovation and benefit both the industry and the government. The Corps is authorized to utilize the capabilities and facilities of its R&D laboratories to pursue joint R&D, demonstration, and commercialization/technology transfer projects with an industry partner. The projects are based on ideas from the construction industry, and the Corps may provide up to one-half the cost of a project. Recent additional authority permits the Corps to utilize contributions of other federal agencies in the program. Through FY95, 72 projects were selected, with the industry providing $42 million and the Corps $27 million. CPAR products are being utilized by the construction industry and are increasing productivity and reducing costs. CPAR funding for FY96 was deleted by the Congress, and the program is currently inactive, except for the completion of the remaining projects.

The Army has been a leader in technology transfer efforts from federal laboratories to the public and private domestic sectors for many years. Each Army laboratory and RDEC has an Office of Research and Technology Applications (ORTA) to actively seek technology transfer opportunities and serve as a point of contact for potential users of its technology. The functions of an ORTA include assessment of laboratory technology which might have commercial applications, assistance to state/local governments, and the development of CRDAs and PLAs in conjunction with private sector and laboratory technical and legal staffs. The ADTT program is intended to work through the decentralized but coordinated activities of the ORTA at each of the army's laboratories and centers.

During FY96, 183 CRDAs and 19 PLAs were approved, for a total of 202 new agreements. Since most of the agreements negotiated since the inception of the program are still active, we track the cumulative totals, which were: 824 CRDAs, 71 CPAR CRDAs, and 73 PLAs for a total of 968 agreements (see Figure VII-2). Total patent royalty income since inception of the program was $927,000, of which $198,000 was paid to individual inventors, with the remainder to their labs.

Figure VII-2. Army Accepted CRDAs/PLAs

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The booklet "Army Technology Serving Society," published in FY95 presents over 40 technology transfer success stories. By demonstrating the major benefits of this program to both our partners and the Army, it has generated great interest among potential partners and among brokers who can help match the Army with partners.

Some specific examples of recent cooperative efforts include:

In the future, the Army will continue to support ADTT through strong management support of active ORTAs in conformance with both the letter and spirit of technology transfer legislation. The ADTT Office coordinates ORTA efforts and provides training on marketing and technology portfolio management.

Organized efforts are also under way within the technology transfer community to develop improved ways of assessing the value of collaborative agreements. The Army is an active member of the Working Group on Measurement and Evaluation of the Interagency Committee on Technology Transfer, led by the Department of Commerce. This group is developing a uniform, well-designed set of descriptors and metrics for assessing the value of cooperative efforts as well as other technology transfer mechanisms at all government agencies. A longer-term effort is under way to re-late identifiable events, such as a patent granted or licensed, to larger societal benefits, such as economic growth, as well as to mission enhancements.

The Army will seek to increase its number of quality collaborative agreements. Army CRDAs should be established to develop technology with an obvious value, either in commercial application for improving the U.S. competitive position or in applications for the public good, such as in health, education, or environmental areas. Additionally, CRDAs should be sought in technology areas of strategic importance to the laboratory or center.

The Army is undertaking to coordinate and increase its overall marketing efforts for technology transfer. Individual laboratories and centers are encouraged to aggressively market the expertise and unique capabilities and facilities of their organization. Attendance at technology transfer shows and conferences is an important outreach effort. The Army is expanding its marketing efforts in conjunction with the Federal Laboratory Consortium, a formal government-wide network of all ORTAs, which supports extensive outreach and referral efforts. In particular, we are targeting relationships with high technology small businesses.