Where is the bang for research funding buck?

Academic capitalism as it is now

The creation of an economic engine within the research sector is an increasingly popular policy goal and necessary component of a sustainable research sector.

It’s not just academics that need it. R&D intensive businesses do too. The socio-economic impact of a sustainable research economy also offers political and financial rewards. The opportunity is attractive, but the challenges run deep.

Reflecting on how we got to where we are now is a step toward designing a sustainable research economy.

The money

• English Men of Science and their Nature and Nurture, first published in 1874, questioned whether class was linked to genius. Published at a time when those funding science were patrons from the same elite class as those undertaking it, the study took no account of embedded privilege. Many observe that in this respect, little has changed when it comes to the grant funding system.
• A bifurcation of the funding and scientific communities emerged post WW2. It marks the point in time when the scientific and venture funding communities diverged and a gap between research idea and impact began to grow.
• The systems used for allocating research capital survived this change, putting increasing pressure on metrics to justify allocations. This pressure is compounded by the rapid growth within the research community. The system is being crushed beneath its own weight.
• The sources and systems used to allocate academic research funding, as they operate today are no longer fit for purpose. There is a need for a new set of standards by which compatibility between funding source and funding use is measured.
• Problems within research intensive businesses also encounter pressure points within the current funding system.
• These challenges are unlikely to be addressed by tweaking the spokes on the existing wheels. Fundamental issues need to be addressed. Questions around the financial approaches and organisational structures that can be deployed at the intersection of the non-profit and for-profit boundary to address the funding gaps in research commercialisation are being asked by those departments that do not typically do well at collecting donations, or those where charitable donations flow for basic research but in which a funding gap follows and inhibits translational potential.
• The opportunities for new sources of research capital are abundant. To accommodate the characteristics of the structures they seek to introduce, the research sector may need to learn a couple of new tricks.

The politics

• Thomas Jefferson is recognised for each of his scientific, political and literary achievements. It is a long time since those occupying the halls of political power, were also those conducting experiments.
• The increasing politicisation of research introduces uncertainty within the funding community to such an extent that efforts to find more reliable funding commitments are invested in the philanthropic and private sectors.

• With that shift, the public interest becomes privatised to the will of those unelected funding bodies whose interests will be key in setting the research agenda. A robust governance system is key to maintaining research integrity whilst fostering these relationships so as to avoid the pitfalls that can be observed from academic-industry partnerships gone wrong.
• Whilst calls to foster an economic market from the academic engine come under frequent policy review, recommendations are made within blinkered silos that do not contextualise the multi-faceted nature of the challenge.
• As the research community makes efforts toward increasing its influence within the political realm, other actors within the wider economy are engaging in the debate, elevating the discourse above national boundaries and beyond the risk appetite of typical government funding bodies.

…incrementalism has taken hold of the academic world and it’s a symptom of the way money is allocated. Because of budget issues, the government tends to back projects that are sure things. The things that are already so obvious, experiments where the outcome is already so predictable aren’t really that interesting

The business

• Academic capitalism has long been touted as a research nirvana, in which researchers from academia could collaborate with their industry counterparts and other research-users to fulfil shared goals. It doesn’t take long to recognise that the governance issues that arise in this context require a significant re-working of the status quo, for participants across the research spectrum.
• The licensing business model emerged as a preferable alternative, that conveniently allowed the galactic divide that separates academia from industry to be connected by a narrow thread of marketing intermediary.
• These models represent a solid first attempt at exploring frameworks that could serve the market. Some have worked better than others, locally or at scale.
• The next wave of engagement involves a redesign of the economy so that it substantively addresses the fundamental issues that arise where stakeholders are motivated by diverse incentives and objectives.

Myths and trends

• As participants gain experience in collaborating, and the feedback loop begins to take shape, myths can be recognised and separated from fact.
• A convergence of trends in the research economy supports the idea that stakeholders could form around a sustainable research economy, if the policy, regulatory and commercial settings combined around a robust governance protocol.

Measurement

• Calls for new metrics are coming from stakeholders across the sector. Many cite common complaints around the perversity of the publication incentive structure, while others point to irrational macro economic decisions in the funding system. Others offer observational analysis to make the point that bang for buck does not seem to justify the continuation of reliance on the current system.

The persistence of poor methods results partly from incentives that favour them, leading to the natural selection of bad science

• Attempts to meet these calls are being made from actors in government, industry, finance, philanthropy and the not-for-profit sectors.
• As consensus around key issues and market norms emerge, stakeholders will benefit from increasing transparency around issues of shared value. In doing so, the allocation of responsibility, risk and reward will become more customised to the specific participant and the research they are exploring.

The change that lies ahead

The practical tools and policy settings required to achieve a sustainable research economy, whilst preserving research integrity and allocating risk and reward between market participants are multifaceted, however their solutions are within our collective reach.

Transformative change could be ushered in, with tools and settings that deal with complex underlying topics, including:

• frontier research in fields in which there are few others who can assess that work;
• financial, legal and regulatory issues, that typically involve experts from fields that do not engage closely with the research community; and
• project management in circumstances where key stakeholders are driven by diverse incentives and objectives.

There are social and economic benefits to be derived from research. As we evolve from the industrial economy, knowledge is being recognised as a worthy capital enterprise and a basis for competitiveness. The challenge lies in narrowing the gap between discovery and impact. The efficient stewarding of research through a translation pipeline requires new policy settings and economic levers.

Whilst governments continue to play a critical role in research funding (both through academic grants and industry tax incentives), the impact of those investments is increasingly being questioned, both in terms of social and economic outcomes, but also in terms of accountability for risk taking and priority setting. These questions need to be answered in conjunction with an analysis of the increasing privatisation of some of this function. Improving the structures in which various stakeholders engage, we can start to reduce the gap between discovery and application of research.

Opportunities for new commercial partnerships and financial strategies to fuel research can be unlocked if the resources in the system engage in new ways.

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