By Cyrus Gutnick
The last time this happened, the deal turned sour.
Eleven years ago, in 1997, the Swiss biotechnology company Novartis offered University of California, Berkeley $50 million in a deal to create the the Novartis Agricultural Discovery Institute, Inc.
Half of the money–$25 million—would be for a new research center; the other half to fund research endeavors in areas like chemistry and microbiology. The collaboration would bring together one of the world’s premier research universities and a leading pharmaceutical and agricultural company. But during the collision of the two scientific superpowers, many questioned whether the alignment would be a conflict of interest that would compromise the public university’s notion of independent research and scientific integrity.
By the time the contracts were signed, the amount of money was cut in half to $25 million and the plan to construct a new building was scrapped, partly in response to public outcry, and Berkeley carried on with business as usual. But that was not the end of the controversy. Although no significant results came from the joint research, the questions were just beginning to rise.
Seven years ago, in 2001, after receiving much pressure from faculty, staff, and students and to appease the questioning community, UC Berkeley paid $225,000 for an external review of the research agreement they made with Novartis.
The team was led by Lawrence Busch a specialist director of the Institute for Food and Agricultural Standards and specializes in the sociology of food and agriculture at Michigan State University. After three years of investigations, the report made several conclusions, one of the most important being the necessity of academic freedom:
“Without substantial autonomy, scholarly work is likely to fail to achieve its objectives. It becomes subject to the political whims of the moment; critical issues are ignored or papered over. Creativity is often constrained by a lack of diversity. The agreement between the University of California Berkeley (UCB) and the Novartis Agricultural Discovery Institute (NADI) both promoted and challenged these three principles. This was the case not solely for the research that was the subject of the agreement, but with respect to the educational role of the university as well.”
The Novartis agreement became iconic because, in the end, there was a benevolent parting between the two entities without any breakthrough research. However, it came to represent larger issues, namely the clash surrounding the joining of the public and private sphere on public lands.
One year ago, in 2007, UC Berkeley entered into another agreement to create the Energy Biosciences Institute (EBI). This time they teamed with oil titan BP, formerly British Petroleum, with the round number of $500 million. The same concerns were raised, the same questions were asked and Busch made the same conclusion.
“I think it is a very bad idea. And I can’t put it more bluntly than that. It is an extremely bad idea,” Busch said in an interview with City on a Hill Press. “It goes precisely against the point we made in our book. It is basically giving away the sword.”
Integrating university research with outside entities is nothing new to the UC system; in fact, it is a practice that existed for over one hundred years prior to the most recent agreement made between UC Berkeley and BP. However, this time, the sheer scale of the operation left many resistant.
For example, there was concern that, in order to obtain the funding BP was offering, UC Berkeley would have to acquiescent to the terms set by BP.
From the start, BP has maintained the upper hand. They created a proposal so that universities themselves would be pitted against one another to win the bid at, what many feel is, the expense of their students, faculty, and public tax payers.
In addition to outcry from faculty and scientific community, students formed an organization called Stop BP Berkeley. Kamal Kapadia, a UCB graduate student studying renewable and appropriate energy and a member of Stop BP, recognized the ingenuity of the proposal.
“The BP plan is especially unique,” Kapadia said. “It’s a very clever strategy on the part of BP because this in not the university putting together a proposal and taking it to various donors. And so you have universities competing to make the corporation happy in order to get the money between each other.”
But others, like UC Berkeley vice-chancellor for Research and professor of molecular and cell biology Beth Burnside, simply see the deal as pragmatic research opportunity.
“In launching this visionary institute, BP is creating a new model for university-industry collaboration,” Burnside said in a press conference. “This will stimulate innovation in a way that promises to deliver the maximum impact on fundamental, real-world problems.”
In addition, the agreement promises to bring a new cash flow to sponsor research on campus and provides opportunities for faculty researchers and grad students alike to get involved in cutting edge research. It will construct a new building on the UC Berkeley campus and thus draw attention to the campus.
“This program will further both basic and applied biological research relevant to energy,” BP Group Chief Executive John Browne said at the same press conference. “In short, it will create the discipline of energy biosciences. The institute will be unique in both its scale and its partnership between BP, academia and others in the private sector.”
As the public and private spheres come together once again, UC Berkeley Chancellor Robert Birgeneau remained positive about the agreement between UC Berkeley and BP despite its ten fold size. at a press release.
“Combining our world-class expertise,” Birgeneau said at a press conference, “in the area of alternative energy research and policy with BP’s ambitious vision for the EBI will harness the most creative science and innovative technologies to develop viable solutions to global energy challenges.”
But there those who believe that there are more politics at play than either let on have scrutinized their words.
Bill Friedland, professor emeritus of community studies and former dean of social science at UCSC, notes that in privatization, the university is more vulnerable to outside influences.
Caught between the state budget crisis and BP’s alluring offer, Universities all too often find themselves making huge sacrifices to obtain a portion of the lucrative pool of funding.
Conflict of Institutional Interest
When Novartis subjected their presence on the Berkeley campus, they did it at the relatively nominal price of $25 million over a five-year span. And what does five million dollars per year get you? It gets you almost an entire department, first dibs on potential profitable patents uncovered from the research, facilities and brainpower.
So, what does 500 million dollars get Berkeley? In the package, BP gets many of the same benefits that Novartis received – brainpower, subsidized research, legitimization, and potential future employees. The most dramatic differences is private research sanctioned by UC Berkeley, housed in a new building to be constructed on the UC Berkeley campus.
The public interest will be completely removed as a part of the Master Agreement from Nov. 9, 2007 that states that BP will conduct private research on the UC Berkeley campus closed to all except BP personnel.
The contract between BP and UC Berkeley explicitly states:
2.2.2 The Proprietary Component. The Proprietary Component shall be the portion of the EBI that is dedicated to Proprietary Research conducted by BP employees. It shall be operated under the sole control and discretion of BP.
The Proprietary Component will be physically separate from the Open Component and access will be limited to BP employees only.
The Foundation for Taxpayer and Consumer Rights issued a statement that the agreement “compromises the university’s commitment to public education by allowing secret corporate research on campus.”
Not only will private research be subsidized by UC Berkeley, but the school will also be expected to provide space in order for BP to conduct their proprietary research.
(a) Facilities. BP will lease from Berkeley and Illinois, integrated research lab and office facilities reasonably suited for Proprietary Component Research and administration, and reasonably acceptable to BP. The laboratory and office facilities will consist of (i) at Berkeley, space on the third floor of Calvin Hall pending completion of the Headquarters Building (the “Initial UCB Facilities”)
(b) After completion of construction of the Headquarters Building, Berkeley shall make available, and BP shall lease from Berkeley, on substantially the same terms and conditions as the Initial UCB Facilities, integrated research laboratory and office space in the Headquarters Building for use by the Proprietary Component of the EBI, provided that the scope of the facilities must be reasonably acceptable to BP, and the rent for space in the Headquarters Building shall be at the agreed fair market value rent then appropriate for such space.
That a public university is becoming home to a private corporations is one crux of concern.
“So we are providing and we are taking our public universities and turning them into private labs for BP employees,” Kapadia said. “That is probably one of the reason BP would choose Berkeley. Not only are we giving [BP] private lab space, but their researchers are allowed to use all the labs that already exist at Lawrence Berkeley National Laboratories (LBNL) and in Berkeley which would be provided with public money.”
Within one building will reside the UC researchers and BP scientists. Secured in a separate portion, behind closed doors, will be exclusively BP scientists. This group will have no restrictions from the UC, complete access to all information and no requirement to report their research to any third entity.
“I would suggest,” Busch said, “that the idea that you are going to have a building and there is going to be a firewall going down the middle of the building and that on the one side you will have BP people and the other university faculty is absurd.”
The Bottom Line
According to Dr. Tanner, the past interim director of the UCSC managed Silicon Valley Center (SVC), caution is necessary when being assisted by another entity. The first step is to find a partner that has similar aims and direction.
“Anytime you enter into a relationship with another major source of support, you have to ask yourself if the support being provided is consistent with our mission and our direction or if this source of support is going to cause us to shift our direction heavily towards the interests of that source,” Dr. Tanner said.
However, despite good intentions on the part of researchers to apply for funding to benefit the public good–or at least to benefit the progression of science–it is not uncommon for them to alter their research requests to appeal to the source of funding.
“While I don’t in any way want to suggest that individual faculty members objectivity is undermined in a conscious way,” Busch said. “There are supple ways in which research agendas change because there are certain things that are in interest to companies and there are other things that are of interest to other […] groups in society – to the extent that everybody is working with one company, than that companies aims become the ones that fairly rapidly become the aims of the department.”
According to the Master Agreement, the group that will dictate overall direction and approve budget for the EBI, will be the Governance Board. The Governance Board will consist of eight members, four of which will be appointed by BP. The other four will be consist of at least one representative from Berkeley, Illinois, and Lawrence Berkeley National Laboratory.
The Executive Committee will make all decisions, particularly funding choices. It will initially have two members from BP and three members from other institutions and require a 2/3 majority (i.e. four out of five votes) to do anything. The Governance Board must approve any changes to this structure. This means that BP reserves veto power at both levels and cannot be overridden.
Because BP holds veto power across the board, the faculty researchers work may alter under the umbrella of the EBI.
“That’s why BP put the money in it,” Busch said. “They didn’t put it in because they thought it would be fun. If BP felt that this was a good investment for the future independent of the BP company, they would have simply given 500 million to the University and walked away.”
Other sources of revenue, grants received from National Science Foundation or the Department of Energy for example, potentially have fewer strings attached to the money. The researcher would still have to draw up a well drafted proposal, but the research would be created with a heavy emphasis on scientific value to increase quality of life for the public and not as much for profit margins.
“Funds received from government agencies would not have corporate strings attached,” Busch said. “They would be funded on whether or not they appear to be good science. That is not to suggest that BP would try to fund bad science, clearly they don’t want to do that. They want to fund good science that will benefit them.”
Only time will tell how BP’s presence will affect the science, the research, and the university’s role as a public institution, because in the end, behind BP is the board of directors and the shareholders they represent.
“In the case of this agreement,” Busch said. “It will be things where not only the scientific considerations but the potential positive affect on the BP bottom line.”
_Additional reporting by Jono Kinkade_