It has been long suggested that a key step in building Arizona's new economy is to allow professors and universities more varied means of bringing their products to market. The debate entered a new phase yesterday, when Governor Janet Napolitano signed a bill to put the matter to the voters.

House Bill 2403, also known as the technology-transfer bill, places a measure on the 2004 ballot that, if approved, would change the Arizona Constitution to allow universities to accept company stock as compensation for licensing technology developed by university personnel. The current law requires payment in the form of royalties, which places a considerable burden on young, cash-poor companies.

Arizona universities must currently struggle with ways of bringing such products to market. Their strategy has been to establish special agencies, such as Arizona State University's Arizona Technology Enterprises, often requiring somewhat Byzantine structures to legally benefit from the fruits of their labors.

The University of Arizona Foundation, for example, recently established an independent, nonprofit company to handle patents donated by Proctor & Gamble. The company, unlike the university, can take equity in any businesses spun off from the donated technology, then channeling funds arising from the spin-offs back university. The technology-transfer bill would help to eliminate the need for such a setup.

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For more information:

"Governor approves technology-transfer bill," Arizona Republic, 09/05/2003

"Vote will decide fate of new business sector," East Valley Tribune, 09/05/2003

P&G patents spur new tech-transfer company at UA, 08/27/2003

ASU receives "Herculean" donation, 07/22/2003 

New ASU office unites research, economic development, 06/04/2003