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Council Coverage

At the March 24 Council meeting, Bonnie Gibson gave an extended report on the University's budget (see Almanac March 30, 2004 available online), and Vice Provost for Strategic Initiatives Les Hudson gave a presentation (see below).

Safety and Security Committee's interim report indicated that they are exploring issues such as lighting, safety in parking lots, diversity, safety of women on campus, international students' concerns, traffic safety and bicycle safety.

President Judith Rodin spoke about Penn's new urban research institute (Almanac March 30) that is sponsoring a symposium on April 14. Dr. Rodin and the institute's co-chairs will be in Washington, D.C. for congressional briefings later this month. The institute will provide an umbrella for the many Penn/West Philadelphia initiatives and aspirations yet to be fulfilled." The Urban Agenda is one of the five new academic priorities, along with The Arts (Almanac September 23, 2003). March 24 was the second annual Arts Day at Penn (Almanac March 16, 2004).

Robin Beck, vice president for ISC, gave a presentation on campus-wide electronic mailings and explained that there are more than 30,000 e-mail users at Penn. She said that there are two different services offered by ISC for large mailings. Those who send campus-wide mailings to predetermined lists such as all faculty and staff are charged $250 to cover costs to send the e-mail in stages to the different servers on campus, often overnight. However, those who set up e-mail lists that are hosted on ISC servers are charged a $30 one-time fee and an annual $40 fee.

GAPSA then presented a resolution, and seconded by PPSA,  on e-mail access for Council constituencies to have a fee waiver or the allocation of sufficient funding to e-mail their members, ie., GAPSA, UA, PPSA, WPSA and the faculty. It received widespread approval from Council.

A resolution on the PennPass Program was also presented by GAPSA, and seconded by the UA, to make SEPTA passes more cost-effective, more flexible and more widely used by Penn students, faculty and staff. It received nearly unanimous approval.

Penn students from The Ivy Council--an organization of student representatives from the Ivy League holds an annual Ivy Leadership Summit--explained their need for support from the administration for their endeavors. VPUL Val Cade then volunteered to work with the UA to assist them and Senate Chair Lance Donaldson-Evans offered the expertise of the Faculty Senate leadership.



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Report to Council on Strategic Initiatives, Dr. Leslie Hudson, vice provost for Strategic Initiatives

Transcribed and condensed from Dr. Hudson's
oral presentation to the council

The new Office of Strategic Initiatives is part of the expanded role of the provost's office and brings together functions that existed but had never been operated in an integrated way. The responsibilities include managing technology commercialization and providing economic leadership. Penn has not held itself separate from its surrounding community and the southeast corner of Pennsylvania has gained a great deal from the presence of Penn.

So, in a sense, in this new decade we are going into with a new president coming we'll actually have an enviable position to be able to leverage the tremendous advances and indeed the models that were built from the previous presidency in how a university can engage with the community for the betterment of both.

To refine and improve ongoing operations, to help revenue and expense sources to contribute to our core mission--that of scholarship in teaching and research is the driver that is important. This is not an office which is there simply to drive revenue, it's to drive revenue with a purpose related to our core mission.

The gifts will continue to be an extremely important means by which Penn will be able to grow its core mission but commercialization of it's intellectual property generated from federally-funded research grants and to increase access to industrial partnership is one major area where we can grow revenue and engage in research scholarship and training of a type that we have not really plumed as deeply as we will going forward.

The IBM company is extremely interested in trying to investigate new types of relationships with universities like ours at a time in American history when we are starting to transform many of our technology-based industries in a way which probably 20 years ago would have been impossible to predict. IBM at that stage and for the following 10 years made and sold computers. Now IBM is a major life sciences research-based company and it sells consulting services. Something that's becoming hugely important for the country going forward.

The manufacturing industries now are being off-shored at increasing rates. We are seeing a tipping point of the change of the basis of American competitiveness. I should note that in spite of my accent, my passport, indeed my choice of citizenship is American so I'm very much in this with you.

Penn's research investment has really been stellar and it's been a sustained investment. Looking at today compared with where we were last year, the federally-funded research grants were about 97% of all our funded grants. We are within 3% of where we were last year so we're going to continue to be receiving grants up to and probably in excess of $700 million. On an annual basis we actually invest $400 million a year in our in-house research enterprise. 

This is a major engine that generates intellectual property. The intellectual property is largely marked by medical inventions and this is an area which because of the preeminence of our medical school and also because we have under the same management structure our health system, we are very well positioned to be able to continue that growth and advance. Engineering and nanotechnology and are starting to become increasingly important.

Tech transfer occurs through the Center for Technology Transfer. In that office they are responsible for the commercialization of Penn's technology and they control the capital and revenue funds that are responsible for that.

As for corporate alliances, one very new and exciting development was the decision by GlaxoSmithKline to put a drug discovery unit on site. That was extremely important and is deeply integrated into our research scholarship. It's an important interface because we are seeking to decode the human genome and many of the partners that we will have are non-traditional informatics companies like IBM, drug companies like GSK and many biotech companies.

In terms of the economic development capital we've seen new sources of funding grow our research base within the state. There was a very innovative, appropriate use of the tobacco settlement money through BioAdvance which was money given to initiate primary research and to commercialize technology out of universities like our own.

We have a total expense base over that 18-month period of about $7.5 million but it's driving a capital and revenue stream of $94 million. This is an area where we believe there will be opportunity for future growth given some of the changes that are happening. This is a very important, critical gap which is actually opening up in universities in the U.S. and it's between the producers of technologies and intellectual property, like ourselves, and the people who traditionally facilitate the commercialization, the venture capital funds and other sources of investment capital ultimately to take that intellectual property into product where companies like, GSK or Lockheed Martin would actually buy them. 

This has become such a problem that the federal-funding has funded to the point where basic research stops and patent protection begins. There's now an increasing void to sources of investment capital to take the products of our research into commercialization. This is something which the University is working on with the National Council on Competitiveness, one of the members of which is the State Department, to prepare a position statement and advice for the next administration in November. Penn is looking at this idea of a university putting together a translational research fund which will help to start driving some of our research closer towards more effective commercialization. This should be a self-sustaining loop which will drive excess revenue back into our core mission.

I alluded to the transforming a relationship with a company like IBM; we've actually had about a 20-year relationship with IBM. They've been a very major donor to the University, donating more than $20 million in gifts. The University has been a major source of recruiting for them. One of the things they're seeking is a relationship with us that would leverage buying power of the University and the health system. What we're looking at here is collaboration with them around life science research, around grid computing, and e-learning and major gifts. But if you like a non-traditional relationship where the health system and the University's buying power in laptops and also in desktops could well bring Penn a preferred provider relationship with IBM whereby we would get a highly competitive price on high- and low-end laptops and desktops. Not that this would actually be something that we would have to buy, but it would be something which we could have access to both as staff, students, faculty, alumni.

A very different, but equally important thing which has just happened is the passage of new legislation through Harrisburg in the creation of  Keystone Innovation Zones. These are zones which Ed Rendell, with the president's help, identified as one of the key success factors in the future growth of wealth in Pennsylvania, and literally it's to unlock the intellectual property and commercialization potential of the patents and the expertise within the University. The new legislation was signed into law about a few weeks ago. It could create a zone immediately adjacent to the universities. In our case we've started discussion with Drexel, clearly two universities, one shared campus, good complementarity, and on their part and our part very high interest in partnering this way. BioAdvance, the Science Center, Innovation Philadelphia are also partners as well as the Ben Franklin Technology Partners who are clearly interested because they basically are part of our region in trying to drive this opportunity. It brings important tax advantages as a 15-year abatement where if one is a company that has no revenue and therefore you don't pay tax,  then you can trade your tax abatement with a company that does have revenue and so from that point of view it can become a very important way of getting a revenue support for a new struggling  company. It gives us an opportunity for serious outreach and marketing to both commercial and industrial sectors. The reason that's important is that if you look at where these zones are likely to be, you see the Penn and Drexel campuses, you see where the Science Center is 2,250,00 square feet of research, laboratory and office space, the translational research building that was the Eastern Apparatus building which Penn is actually converting for translational research will be ready early fall. The Post Office Lands, as you know we have an option to purchase that and will be moving on that towards 2007. The Civic Center already is within our holdings and work is already ongoing. So this is not to create a zone of innovational commercialization which will invade our campus. Its virtue rather is to create a zone of future partners for us as we actually engage in our core mission both of teaching and scholarship and also research.


Potential for Major Keystone Innovative Zone



  Almanac, Vol. 50, No. 28, April 6, 2004