Todays modernization is tomorrows readiness: without it, we risk sending soldiers into the next war without the technological edge required to obtain decisive victory with minimum casualties.
General Dennis J. Reimer
Army Chief of Staff
A. ARMY TECHNOLOGY TRANSFER
The Army technology transfer program seeks to promote the transfer of technology to enhance both the economic competitiveness of our country and our military capabilities. Army laboratories and centers have a wealth of technology, advanced facilities, and expertise that can be used for more than national defense. The Army technology transfer program works in synergy with our national industrial infrastructure to strengthen both military and economic security. This militarycommercial synergy has always been important, but as military resources decrease with the end of the cold war and as commercial competition replaces military competition, it becomes critical.
Once the Army sustained a technology and production base that was focused on military needs and isolated by culture and rules from the civilian commercial world. The Army is no longer able to afford this luxury. In fact, ending this isolation in some technical areas will enable the Army to exploit commercial technology that is more advanced than its military counterpart. The Army continuously monitors new developments in the commercial sector, looking for potential military applications.
In the 1980s, formal technology transfer programs were initiated to apply spinoff from military technology to benefit the civilian economy. But with the decline of defense funding, changes in the nature of the military threat, and an increase in the rate of change of commercial technology development, DoDs emphasis has evolved to include dualuse and spinon technology. Dualuse technologies have both defense and nondefense applications. Spinon technologies are developed outside the Army, but have military applications. The potential to bolster civil and military strength through a common production base is being recognized in DoD and technology transfer is now recognized as essential to DoDs mission.
This chapter describes various components of the Army technology transfer program, which uses an exceptionally wide range of management approaches, legal mechanisms, and types of partners.
NATIONAL DEFENSE AND ECONOMIC COMPETITIVENESS
As defense spending declines, we must merge military and civilian technology and production bases wherever possible. Because dualuse technologies have both defense and nondefense applications, our military capability gains from the large investment in civilian R&D and production capacity; conversely, our economic capability gains from military investment (usually in leadingedge technology). Similarly, medical and environmental capabilities developed for the military have civilian application, and vice versa. Therefore significant effort is devoted to tailoring our R&D programs so we do not reinvent the wheel in areas where civilian capability leads, but effectively hand off our advances where they have value to the civilian economy.
This section highlights several programs that are designed to encourage development of dualuse capabilities, and to hand off those aspects of predominantly military capabilities (technologies, knowhow, and facilities) that have civilian application.
1. Small Business Innovation Research Program
The Small Business Innovation Research (SBIR) program allows the Army to access the innovative technologies of small, hightechnology firms. Using a competitive selection process, the Army SBIR program supports small hightechnology businesses in conducting high quality research on innovative concepts. Of particular interest are R&D efforts leading to solutions of Army defenserelated scientific or engineering problems that permit the small businesses to commercialize their developed technologies in the private sector.
As mandated by public law, the SBIR program is intended to (1) stimulate technological innovation, (2) increase small business participation in federal R&D, (3) increase private sector commercialization of technology developed through federal R&D, and (4) foster and encourage participation in federal R&D by womenowned and socially and economically disadvantaged small businesses. Firms participating in SBIR must employ fewer than 500 employees, as defined by the Small Business Administration and must be U.S.based, forprofit businesses.
Congressional mandate requires that all federal agencies having an annual extramural R&D budget exceeding $1 billion must participate in the SBIR program. The SBIR budget is computed according to a certain percentage of the participants extramural R&D budget. For FY97 and thereafter, this percentage is 2.5 percent. The Army SBIR budget for FY97 was $93.7 million and is expected to remain at that level for FY98.
Each year, in cooperation with other DoD components, the Army generates and publishes a set of highpriority topics in the SBIR solicitation and invites small businesses to submit proposals dealing with these topics. The SBIR solicitation lists the topic opportunities, defines proposal formats, and states the proposal evaluation and selection criteria.
The SBIR program is a threephase program as depicted in Figure VII1. Phase I determines the scientific or technical merit and feasibility of proposed concepts and typically takes up to 6 months to complete. Approximately 1 in 10 to 1 in 5 Phase I proposals are selected for award. Those Phase I performers showing the best promise may be invited by the Army to submit Phase II proposals. Phase II is a 2year effort covering the main R&D work. Approximately onethird to onehalf of the invited Phase II proposals are selected for award. Phase II projects develop welldefined products or services that have relevance to the Army/DoD and the private sector.
Figure VII-1. Small Business Innovation Research Program Flow Process
Phase III is the last step in the SBIR process. In Phase III the small business is expected to market and sell the products or services outside the SBIR program that were developed during Phase I and Phase II. No SBIR funding is provided in Phase III; however, the firm is free to pursue nonSBIR government followon contracts (solesource or otherwise), or a leveraged combination of nonSBIR government and private sector funding.
Since 1982, the Army SBIR program has funded thousands of small businesses working to provide innovative dualuse technologies. The program has been successful in meeting or augmenting Army technology needs while strengthening the nations small businesses by moving their technologies to the marketplace. This process was greatly enhanced, beginning in FY96 and continuing through FY97, by the Armys implementation of the SBIR 2year pilot fasttrack program. This program was designed to accelerate into Phase III those small businesses that are able to identify thirdparty matching funds for Phases I and II. The Army also implemented acquisition streamlining procedures during calendar year 1996 in its Phase I and II selection and award processes. These streamlining procedures have shortened FY97 Phase I and Phase II selection/award times to an average of 4 months and 6 months, respectively.
The Army promotes the commercialization goal of SBIR by conducting an annual Phase II Quality Awards Program that recognizes stellar Army Phase II projects for their technical achievement, contribution to the Army mission, and commercialization potential. A panel of Army and industry experts selects five projects each year to receive this award. The winning companies and their sponsoring laboratories or centers are presented with the awards at an annual awards banquet. Throughout the year, the winners and their accomplishments are showcased at several Army conferences and symposia.
During 1996, an operating and support cost reduction (OSCR) initiative was implemented to target a segment of SBIR efforts at this critical highpayoff area. Initially, the goal was to have at least 15 percent of the 1996 SBIR solicitation topics directed at OSCR issues. Due to the responses of the laboratories, centers, and small business community, this goal was surpassed for topics (20 percent) and at each subsequent stage of the SBIR process. Of the Phase I awards, 20 percent were to OSCR projects. These OSCR Phase I projects will compete for Phase II funding in FY 1998.
Information about the Army SBIR program is available via the Internet at the following Website address:
2. Small Business Technology Transfer Program
The Small Business Technology Transfer (STTR) program began in FY94 as a 3year pilot program established by Congress in P.L. 102564, the Small Business Research and Development Act. The STTR program was reauthorized for FY97 and reauthorization for the period FY9800 is under consideration by Congress. The STTR program is a competitive program that urges small businesses to partner with researchers at universities, nonprofit research institutions, or federally funded R&D centers (FFRDCs) to speed commercialization of emerging technologies and discoveries of interest to the Army and the private sector. The small business must perform a minimum of 40 percent of the R&D work in STTR contracts and must subcontract with a research institution for a minimum of 30 percent of the proposed work.
Army STTR topics are based on critical technologies that reflect the Army mission and emphasize potential commercialization and dualuse applications. The Army had 12 topics in the FY97 DoD STTR solicitation, which closed on 2 April 1997. The FY97 Army STTR budget is derived from a setaside of 0.15 percent of the total FY97 Army extramural R&D budget.
Similar to the SBIR program, the STTR program consists of three phases. Phases I and II are funded with Army STTR funds. Phase I, the proofofprinciple phase, is limited to $100,000 and 1 year. Upon satisfactory performance during Phase I, selected small businesses are invited to submit Phase II proposals. Phase II awards are limited to $500,000 over a 2year period. Phase III is the commercialization phase, wherein the small businesses transfer the matured product or technology to the market. The small businesses receive no STTR program funding for Phase III.
The first "graduates" of the STTR program will complete Phase II this year and enter Phase III. Some firms have already received commercial contracts for their STTRdeveloped products. Successful Phase III transition of these firms to the commercial marketplace will be highlighted in future Army publications.
Extensive STTR program information is available via the Internet at the Web address listed above.
3. Army Domestic Technology Transfer Program
The Army Domestic Technology Transfer (ADTT) program seeks to create an environment that fosters and facilitates the transfer of technology between military and civilian applications, thereby contributing to military needs and economic competitiveness. There is a long history of technology transfer from inhouse Army R&D to commercial application. For example, Army technologies form the basis for both the alkaline battery industry and the flexiblepackaging industry for food preservation. These in turn provide strong production bases for military needs.
The initial formal requirement for technology transfer from federal laboratories was the StevensonWydler Act of 1980 (15 U.S.C. 3701 et seq.). Its intent was to maximize the benefit of taxpayer investment in federal R&D. The Federal Technology Transfer Act of 1986 (P.L. 99502) provided specific requirements, incentives, and authorizations for federal laboratories to 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 (P.L. 104113) amends these laws to provide additional incentives, encouraging technology commercialization for both industry partners and federal laboratory inventors. This law seeks to promote industrys prompt deployment of inventions created under CRDAs by guaranteeing the industry partner sufficient intellectual property rights to the invention and by providing increased incentives and rewards to laboratory personnel who create new inventions.
A CRDA is probably the most powerful tool used for technology transfer. The CRDA is an agreement to cooperate and share intellectual property resulting from joint R&D efforts. It makes the technology, facilities, and people of Army laboratories available to commercial partners at an early stage of development, directly benefits the Armys mission from the partners effort, and encourages direct interpersonal communication between scientists and engineers of the two sectors. Since a CRDA is not a procurement device (the government does not provide funding for services or products), military procurement procedures are not required.
PLAs are also important for commercializing inventions developed in Army laboratories. Each laboratory 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. Royalties are shared by the inventors (who receive the first $2,000 and thereafter 20 percent of royalties received) and the laboratory (which keeps most of the remainder). The ADTT program is initiating more aggressive patent marketing strategies to increase the level of Army patent licensing.
The construction productivity advancement research (CPAR) program was a costshared, collaborative R&D partnership between the U.S. construction industry and the Corps of Engineers designed to enhance construction industry productivity and innovation and benefit both industry and government. The Corps was authorized to use the capabilities and facilities of its R&D laboratories to pursue joint R&D, demonstration, and commercialization/technology transfer projects with industry partners. The projects were based on ideas from the construction industry, and the Corps could provide up to onehalf the cost of a project. Through FY95, 72 projects were selected, with the industry providing $42 million and the Corps $27 million. CPAR products increased productivity and reduced costs. CPAR funding for FY96 and FY97 was deleted by Congress, and the program is currently inactive, except for completion of ongoing 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 research, development, and engineering center (RDEC) has an Office of Research and Technology Applications (ORTA) to seek technology transfer opportunities and to serve as a point of contact for potential users of its technology. ORTAs assess laboratory technology that might have commercial applications, assist state/local governments, and develop 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 Armys laboratories and centers.
During FY97, 188 CRDAs and 14 PLAs were approved, for a total of 202 new agreements. Since most of the agreements negotiated from the inception of the program are still active, we track the cumulative totals, which were: 1,083 CRDAs, including CPAR CRDAs, and 87 PLAs for a total of 1,170 agreements (Figure VII2). Total patent royalty income since inception of the program was $1.18 million, of which $0.255 million was received in FY97.
Figure VII-2. Army Accepted Cooperative Research and Development Agreements
and Patent License Agreements
Recent cooperative effort examples include:
The Army Research Laboratory (ARL) has teamed with a commercial partner to test and evaluate technology for locating and mapping nonmetallic buried pipe and shallow tunnels. The ability to locate nonmetallic pipe (e.g., polyvinyl chloride (PVC)) would be extremely useful to the utility industry). Military applications of this dualuse technology could include detection of buried plastic mines and the ability to locate and map enemy tunnels.
The Corps of Engineers Waterways Experiment Station (WES) has awarded multiple patent licenses for its patented CORELOC technology. CORELOC is a new concrete armor unit used to protect navigation and coastal shore structures (e.g., breakwaters). Unlike most other types of concrete armor units, CORELOC is placed in a single layer. With its low packing density, CORELOC significantly reduces onslope concrete volume and can save project owners over 50 percent of the cost associated with other concrete armor units.
The life support for trauma and transport (LSTAT) is a transportable, stretcherbased miniintensive care unit that was jointly developed through a cooperative agreement involving industry and investigators at the Walter Reed Army Institute of Research. The LSTAT incorporates stateoftheart resuscitative and lifesustaining capabilities in a universally adaptive platform for trauma management, unattended patient support, and transport of medically unstable patients. The system has broad dualuse applications in military and civil settings.
The TankAutomotive RDEC (TARDEC) has two CRDAs with the private sector for R&D on blind spot monitoring systems for vehicles to help avoid collisions. The blind spots around vehicles are serious hazards when drivers change lanes or merge with moving traffic. Results of these efforts could be applied to private and commercial vehicles, large and small, to help avoid many injuries each year.
In the future, the Army will continue to support ADTT through support of active ORTAs. Army CRDAs should be established to develop technology that contributes to the national competitive position or the public good in health, education, or environmental areas. Additionally, CRDAs should be sought in technology areas important to the laboratory or center.
The Army is also seeking to coordinate and increase its marketing efforts for technology transfer and patent licensing. Individual laboratories and centers are encouraged to aggressively market the expertise and unique capabilities and facilities of their organizations as well as their technologies. Attendance at technology transfer shows and conferences is also an important outreach effort. The Army is expanding its marketing efforts in conjunction with the Federal Laboratory Consortium, a formal governmentwide network of all ORTAs, which supports extensive outreach and referral efforts. Additionally, we are targeting relationships with hightechnology small businesses.
4. Technology Transfer in Medical Research and Development
The primary purposes of military medical R&D are preventing injury and illness in the field and sustaining life and health. However, there is probably no other DoD program whose research results are so directly applicable to the worldwide civilian community. Advances in antimalarial drugs, vaccines for many diseases, blood and tissue substitutes, and the treatment of trauma are all of direct benefit to people. The benefits are not limited to the United States; for example, DoD research teams deployed in Egypt, Taiwan, Indonesia, Thailand, Malaysia, Brazil, and Peru have worked directly on civilian health problems that not only are threats to possible future deployment of American troops, but also are presently infecting local populations. Medical R&D also contributes to establishing national and international standards for nutritional requirements of special populations and exposure to occupational health hazards, as well as developing and demonstrating modeling technologies for predicting the effects of exposure to health hazards. For example, the Department of Transportation has used the Armys blast overpressure injury model to predict injuries from driver and passenger air bags.
The Armys first collaborative efforts in medical R&D were basic screening and testing agreements, under which a company or university would submit compounds for testing for a specific property, such as antimalarial activity. These early agreements quickly evolved into more extensive collaborative efforts where each partner would expend resources toward the development of a product and share the results of its efforts to meet the Food and Drug Administrations regulatory process. The development of mefloquine is a classic example of an early cooperative effort between the Army and industry that predates the Federal Technology Transfer Act. Each party funded its own preclinical and clinical studies with its own unique resources and shared and consolidated the data. The Army medical R&D program over the past decades has fostered thousands of cooperative relationships with academia and industry.
The Army has numerous compounds, some with commercial value and some with military value. For example, the Army is developing several compounds that appear to be active against malaria, leishmania (a problem for some Operation Desert Storm veterans), and pneumocistis , which kills many AIDS patients. A collaborative effort on such compounds allows industry and the Army to leverage each others resources. The Army also has several products or technologies useful to the research and commercial communities, from vaccine production tools to qualitative and quantitative assays.
The Medical Research and Materiel Command (MRMC) is initiating an intellectual property and transactional management project to identify established and emerging intellectual property practices in industry and adopt those practices where possible. Initial practices will include routine review of the Official Gazette and targeting marketing strategies for identified technologies.
The MRMC encourages research in relevant fields at colleges and universities, and cooperates with research efforts of the National Institutes of Health, the National Science Foundation (NSF), and other government agencies. These research programs complement and exploit civilian science and technology efforts over the full research and development spectrum. The commercial sector is encouraged to address problems of military interest through the SBIR program. The Federal Technology Transfer Act is the authority for numerous MRMC CRDAs, primarily with pharmaceutical, chemical, and biotechnology firms. Medical R&D is an international program of broad and effective current and potential opportunities in developing and developed nations. The MRMC participates in information and data exchange programs, cooperative developments, NATO comparative tests, foreign weapon evaluations, and symposia and meetings.
5. DualUse Information
As defined by public law, dualuse technology has both military and civilian applications. Most dualuse technology is generated through spinoff (commercialization of military technology for civilian applications; e.g., IR sensors) or spinon (military adaptation/application of commercial technology; e.g., stateoftheart computer hardware/software).
The Army is an aggressive partner in dualuse R&D, with the primary motivation of leveraging commercial technology for military applications. The Army uses more CRDAs than the other two services combined to leverage the R&D investment by industry. The Army also uses the Advanced Concepts and Technology II (ACT II) program to support Training and Doctrine Command (TRADOC) battle laboratories and their Army laboratory/R&D center partners in evaluating commercial concepts and technology with high potential military utility (Section D).
The Army targets dualuse projects in combat vehicles and automotive technologies, aviation, medical research and technology, construction engineering, environmental research, pollution abatement/control, telecommunications, sensors, and individual soldier technology. Examples include:
ARLs federated laboratories heavily leverage industrial and academic basic research infrastructure and expertise through cooperative research agreements in areas where commercial industry has the technical lead and incentive to invest (Chapter V).
The National Automotive Center (NAC) serves as a focal point for dualuse technologies and application to military ground vehicles. An umbrella CRDA with General Motors, Ford, and Chrysler provides the basis for significant technology transfer (Section D).
The National Rotorcraft Technology Center (NRTC) established a government/ industry partnership that combines the resources of the government, the rotorcraft industry, and academia, and identifies and develops dualuse rotorcraft technologies (Section D).
The Army is also a participant in the DoD DualUse Applications Program (DUAP) S&T initiative. This initiative provides incentive funding to the services to support dualuse technology development projects. These funds are matched by service funds, and the total of these two is matched by the industry partner(s). DUAP projects therefore involve a mix of Army (25 percent), DUAP (25 percent), and industry (50 percent) funding, using cooperative agreements or other transactions for their execution. The costsharing by industry is a concrete demonstration of its commitment to exploit the resulting technology for commercial as well as military applications.
In FY 97, the Army gained DUAP support for 38 projects under the S&T initiative, resulting in over $21 million in DUAP funding for Army S&T projects. Additional DUAP funding will be available in FY98 for matching by Army and industry, increasing the overall Army investment in dualuse technology and leveraging on the industrys share in the development of these technologies.
Click here to go to next page of document