On Making Research Pay For Itself

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Hi Scholar,

The argument advanced by this essay is, I must warn you, flawed in many ways. It was not written in the hope that you, dear Scholar, would upon finishing it nod your head and say "that was correct". Rather, this essay has been crafted in the hope that you will finish it and say "that was interesting". 

On Making Research Pay For Itself

- Written by The Tatler

For the last 11 years, an intense legal battle has been going on regarding who gets to own - and therefore profit from - a technology developed on a foundation of publicly funded academic research. CRISPR-Cas9 is a technology capable of editing genes within living organisms; potential applications of the technology range from personalized medicine to drought resistant corn and everything in-between. The intellectual property while under patent is worth billions annually in licensing fees - hence the prolonged fighting over it. Once the patent expires and the technology enters the public domain, its value is not likely to drop. 

You would be forgiven for shrugging your shoulders. Basic research has simply led to the creation of practically useful and commercially viable technology - the goal of academic research has been achieved. Does it truly matter who owns this technology? For most of the time academic research has been publicly supported, the answer has been an emphatic "no". However, at the present moment, political conversations around the "value of research", or perhaps more appropriately its lack of value, are becoming more prominent. To put it plainly, despite the enormous value that academic research creates, the investment required to create that value is always vulnerable to attack. In this context, where the value that publicly funded research creates goes, who is able to capture it, is a more serious matter that warrants consideration. This brings us to the central question of this essay:

Does the current system of publicly funded research recycle the value it generates effectively enough to sustain future investment?

You may find this question concerning the "efficient" use of "value generated" in the context of knowledge creation to be distasteful. Indeed, this is the exact opposite of what The Scholar Manifesto was concerned with as well as the broader ethos of The Scholarly Letter. Well I must be frank with you. In this discussion, there will be no critique of the commodification of knowledge - i.e. its treatment as an economic asset ripe for exploitation - that is encouraged by neoliberal economic logics. The value of knowledge will be defined in relation to how much financial reward it can bring. The assumption that public research must be used by the private sector to bring innovation will not be questioned. However, do not mistake this as blind support of a system that enables the ownership and control of knowledge for financial gain. The ideals and principles of this publication have not changed: we believe in knowledge as a public good. We also believe that publicly supported knowledge belongs in the commons. Our discussion today is rooted in a desire to adjust the laws that allow ownership and control of knowledge, without rejecting them, for the benefit of the knowledge commons. For some, this position will not be radical enough. However, by refusing to engage with the current realities of ownership and control, we risk leaving the commons ever more vulnerable to exploitation. 

Part 1: For the Public Good

The vast majority of academic research - that done by academics in universities - is publicly funded. Such has been the way of things since World War II firmly linked scientific - and by extension, technological - advancement with national security. While charitable and private funding of academic research certainly exists, for simplicity we shall focus our attention on governments as funders. This does not seem unreasonable, given they do the majority of the funding. 

Despite how messy it is to directly measure the economic benefits of academic research, government support for academic research is usually given freely, and generously, owing to the frequency that private enterprise develops technology and products which rely to publicly supported research. These technoscientific innovations, of course, are drivers of economic growth. The EU estimates that every €1 invested in research via the Horizon Europe programme "generates up to €11 in economic gains"; The IMF declares that "public investment in basic research will pay for itself"; The UK government recently announced its intention to "radically improve people’s lives through science, innovation and technology"

The widely accepted rationale for public investment in academic research is, at least in principle, circular. The larger budgets for academic research that most governments attempt to provide each year, are drawn from the proceeds of general taxation. One of the surest ways to increase tax receipts is through economic growth which depends on scientific and technological progress. Economic growth begets higher tax revenues, which then cycle back into expanded research investment. The circularity of the research funding system is something to celebrate; a circular economy is certainly an improvement on the linear model, or "take-make-waste" model, that our broader economies follow. Such linear models required a continuous injection of fresh resources in order to function: to sustain them therefore, requires continuous taking and extraction. A circular model in comparison aims to reduce waste by reusing the initially extracted resources - and products produced from them - for as long as possible. 

So isn't it fascinating that the history of government support for research is marked by periods where such public investment is regarded as wasteful? Governments led by Ronald Reagan, Margaret Thatcher, Jair Bolsonaro, Geert Wilders and, most recently, Donald Trump have all cut funding for research in the name of "reducing waste". If the economic benefits of public research are genuinely circular, how can it so often be cast as waste? Why do governments such as the Trump administration view our currently assumed circular model of funding research as wasteful? 

Could it be that perhaps the benefits of public research are not as circular as we assume? If so, we need to articulate a new rationale and model for funding research. However, there is an alternative explanation that is more compelling: the integrity of our circular funding model is compromised. That is, upon closer inspection of our model, it might be argued that our current system of research funding in practice has more in common with the “take–make–waste” model than it first appears:

Governments award money (take), research is produced (make), which - unless a patent facilitates private ownership for a short time - becomes part of the scientific commons (waste).

It may seem strange to describe the entry of publicly funded research into the commons as the ‘waste’ stage of the model. Yet this is the point where, as we will see, the value invested by governments in public research is extracted out of the circular system. 

Pt 2: Returns on Investment

At the same moment that governments decided to assume the responsibility for funding academic research, research became required to demonstrate a return on investment. In his autobiography Isaac Asimov - who was a chemistry professor before becoming a science fiction writer - recalls that as a 29 year old Postdoc in 1949 he:

This expectation in and of itself need not be problematic if we believe that investment in academic research "pays for itself". No, the problem arises when governments cannot say for certain how much economic value is created by their earlier investment in research. This uncertainty provides the conditions needed for the idea that money on research can be "wasted" to stick. Once the products of academic research are released into the scientific commons, any value that arises from them is extremely difficult to trace, especially when the benefits are small, diffuse and incremental. In the case of CRISPR-Cas9 technology mentioned earlier, its economic value is enormous which makes it slightly easier to “follow the money”. Doing so reveals that, at least in the case of CRISPR-Cas9, the value generated by investment in the scientific commons is anything but circularly distributed.

Jennifer Doudna and Emmanuelle Charpentier shared the 2020 Nobel Prize in Chemistry, for their work published in 2012 which showed that CRISPR-Cas9 could be used to precisely cut DNA in a test tube. In 2013, work done in the lab of Feng Zhang refined the technology further by proving it could be used inside living cells. Institutions associated with both groups of researchers have filed patents and claim to be the legal owners of the technology. Presently, neither side owns the IP in its entirety with patents being split down the lines of the organism the technology is applied in (Doudna and Charpentier’s side have the patent for prokaryotes, Zhang’s side has the patent for eukaryotes) - and the battle rages on. The parties on one side of the lawsuit are The University of California (who employed Doudna), The University of Vienna (who partially funded the landmark paper) and Charpentier herself as an individual. Charpentier was employed at a Swedish University at the time her Nobel Prize-winning paper was published and Swedish law allows researchers to own the IP for their work. The other side is made up of The Broad Institute, MIT and Harvard where Zhang's lab was based at the time his paper was published. 

The two landmark studies that established CRISPR-Cas9 were supported by a blend of public funds from the Swedish, Austrian, and US governments. Yet the technology rests on part of the broader scientific commons that took 25 years to assemble - and was built with contributions from many others. A key contributor to the development of our understanding of CRISPR was Francesco Mojica - whose work was for many years supported by the Spanish government. Other significant contributions came from research supported by the Japanese, Dutch, and EU funding agencies to name but a few. In this sense, CRISPR-Cas9 is a showcase of what global cooperation in science can achieve. But can the Spanish government, for instance, point to its support as money well spent? If the Spanish government, or a Spanish company, wanted to use the technology, they would be required to pay licensing fees for at least the next 10 years to the legal owners. Depending on the application they had in mind, licensing fees would be paid to either two private American universities (Harvard and MIT), or a mix of the US government (through UCLA), the Austrian government (through the University of Vienna), and ERS Genomics, a for-profit company co-founded by Emmanuelle Charpentier to manage licensing of her CRISPR patents. Arguably, from the perspective of the Spanish government at least, the circle has been compromised. Perhaps when the patents eventually expire and enter the scientific commons then a Spanish company will be able to profit from the technology and pay some taxes. However, it would take quite some time for the Spanish government to recoup the initial investment - with fresh funds for the next national research budget needing to be allocated in the near future. 

Part 3: The Tragedy of The Commons:

The case of CRISPR-Cas9 illustrates, as Richard Nelson succinctly put it, that:

The scientific commons, and the eventual deposit of knowledge into it, clearly plays an important role in realizing the economic value of research. However, it is at this point that the ideal of circular value distribution from academic research comes undone. In his now controversial essay "The Tragedy of The Commons, Garrett Hardin wrote that:

One solution to the tragedy as Hardin saw it, was to place common resources into private ownership which would protect them from exploitation. However, Hardin's argument was built on a misunderstanding of how the use of common resources has historically been regulated. Traditionally a common resource, whether it be a piece of land, a stock of fish in the ocean, or the knowledge in a journal article, does have an owner. It is only liable to exploitation when the owners do not enforce regulations concerning its use. Just because something is a common resource does not mean access to it must be fully open and unregulated. The economist Elinor Olstrom spent decades investigating the management of common resources - and won the Nobel Prize in Economics for demonstrating that tragedy only befalls a commons when there are no protections against its abuse in place.

The body of academic research created with public money, the knowledge commons, is analogous to what economists would call a common-pool resource. Common-pool resources are difficult, but not impossible, to restrict access to and they diminish with use (a common example is a fishing ground). While knowledge created by public research does not diminish with use in the same way as a fishing ground, the money required to sustain the creation of knowledge certainly does. The monetary value inherent in the scientific commons is extracted out of our supposedly circular system due to unrestricted use by those who did not contribute to its creation. In this sense the investment governments make in academic research is a waste: the money they pour in is not always recaptured by them to re-invest. The process is a linear one.  

How could the circularity of investment in publicly funded research be repaired? First, we need to identify who the owner is. It seems logical that ownership be tied to funding. Would it be so unreasonable to propose that the one who provides the money for research to be conducted should own the fruits of that research? In funding the majority of academic research, governments already assume responsibility for the health and growth of the scientific commons. As caretakers, could it not follow that they should also be recognized as its owners? While the role that charitable or philanthropic organizations play in supporting academic research has received little attention so far, there doesn't seem to be any reason why they should not be recognized as owners to the extent that their support should warrant. If funders are to be recognized as the rightful owners of the scientific commons, we then face a practical question: how can that ownership be recorded, tracked, and used to channel value back into publicly supported research?

One potential, and radical, solution would be to use blockchain technology, best known for its financial technology and cryptocurrency applications. What follows is not a polished policy proposal but a thought experiment: a provocation intended to explore how circularity might be restored and how the case for publicly supported research could be made more robust. 

Part 4: Storing Patents and IP On The Blockchain

A blockchain is essentially a distributed ledger: a shared, tamper-resistant digital record. Originally developed to record financial transactions conducted in Bitcoin, it has since been adapted to track the ownership and exchange of many other kinds of assets. The assets themselves are not usually stored on the blockchain. Instead, assets are represented by a digital token on the ledger. The token encodes information about who owns the asset, its origin and any previous transactions. Money, songs, images and videos can all be ‘tokenized’ in this way. So too, can intellectual property. 

When an asset is unique or scarce - i.e. not interchangeable - it can be represented on a blockchain by a non-fungible token (NFT). Unlike a fungible token such as a cryptocurrency, where each unit is identical, an NFT is a one-of-a-kind digital token that encodes information regarding ownership rights to a specific asset. In practice, NFTs have been most visible in the world of art and collectibles, but the same principle can be applied to individual research articles which are inherently non-fungible. Each individual research article makes a unique contribution to the knowledge commons, which in theory, makes it suitable to be represented as NTFs. Tokenizing publicly funded research in this way could theoretically allow the individual pieces of the knowledge commons to be tagged, enabling licensing while preserving a transparent record of origin and ownership. Compared to patents, IP NFTs offer greater transparency and easily facilitate fractional ownership, enabling funders and contributors to share rights more easily. Smart contracts - self-executing agreements written in code on a blockchain - can automate licensing and royalty distribution. Unlike territorial patents, NFTs provide a global, borderless record of ownership and can also capture value from foundational research that would not normally be patentable. Additionally, unlike patents with fixed terms, IP NFTs can be designed to provide ongoing rights, making the value of research continuously traceable and ensuring that returns flow back into research funders’ coffers to be reinvested in future research. The process might look like this:

Research article A is tokenized into an IP NTF at the point of publication with ownership divided amongst its funders - as all research articles would be under this system. Articles B, C, and D build upon A, and Article E builds on them all to develop a commercially viable technology. The ownership of the IP arising from Article E is split between the funders of studies A to E, according to the scale of their financial support. For-profit use of the technology requires licensing fees to be paid to the owners (funders) of Articles A to E who will reinvest the revenue into future research grants.   

If CRIPSR-Cas9 had been developed under such a system, the licensing fees for use of the technology would not be payable to four universities and one individual, but to the funders of the work that made the technology possible. Tokenizing IP from academic research is not as distant a possibility as it may sound. molecule.to is an organization specializing in "biopharma intellectual property". One of several projects listed on their website is a basic research study investigating ovarian aging - an IP NFT has been minted valuing the study at $120,000. The IP NFT in question is owned by AthenaDAO, a Decentralized Autonomous Organization associated with the Decentralized Science (DeSci) movement. The DeSci movement is a microcosm of the research community, who are ideologically opposed to the role institutions such as governments, universities and publishers play in governing research. What this essay proposes shares some surface similarities with the DeSci use of NFTs, however the motivations diverge. DeSci seeks to sidestep public funding for research, attempting to replace governments in their traditional role as funders - and has adopted IP NFTs in the hope of profiting from research they have funded themselves (see here for more). By contrast, this thought experiment is attempting to strengthen the role of public funding in research, not to cut it out. 

Scholar, in this essay, I have sought to argue that our current system for funding academic research is not as circular as the discourse surrounding it would suggest. Currently, we operate a take-make-waste model where the value of the publicly supported scientific commons is exploited, and depleted. Yet the estimated financial value of academic research is so large that it should be regenerative. If there was a way to track and re-invest this value back into the system that sustains the knowledge commons, I believe we could achieve true circularity. Academic research would not need to be sustained from general taxation alone, but from the licensing fees and royalties that arise when techno-scientific products emerge from the knowledge commons. 

Post Script:

There are many places a critique of this essay could begin, and though I briefly discuss several below, this list is far from exhaustive. First, as I warned you at the start, "value" in the context of this essay is narrowly defined and distastefully financial in nature. There were many moments during the writing of this essay where I felt intense dislike for framing knowledge, research and scholarship in purely financial terms. However, as much as I dislike it, these are the current rules of the game. Therefore, I have tried to maintain the status quo, and simply tweak the current rules in a way that, to my mind at least, would provide our common knowledge resources greater protection. Of course, presenting a technological solution like blockchain, and the implied utopia we would have if we adopt this technology, comes with its own problems and is antithetical to the previous work published in The Techbroification of Research. 

Second, this argument assumes governments fund research on the basis of a simple cost–benefit logic: if returns are visible, they will invest more. In practice, governments that cut research often do so as part of a broader political project to reduce state expenditure. Even if a blockchain-based IP NFT system could make returns visible, it could not guarantee protection for research funding under a government intent on shrinking the state.  

Third, the system privileges research that yields marketable products. This risks a flood of funding toward applied or translational research at the expense of basic inquiry and disciplines whose benefits are less tangible. This could potentially result in the opposite outcome this essay desires. 

Fourth, to work effectively this model would require extremely accurate record keeping in exactly how research funds are spent throughout the knowledge creation process. A lab or a group in receipt of multiple grants simultaneously, or pooling of resources in international collaborations,  would make disentangling which funder ‘owns’ how much of the resulting knowledge extremely difficult, if not impossible.

Fifth, the model would demand unprecedented global coordination. Unlike the small-scale, community-based commons Elinor Ostrom studied, this would require alignment of IP laws across nations - an immense and perhaps unattainable level of cooperation. 

Sixth, it entrenches the primacy of the written text while failing to account for other ways of producing and sharing knowledge, such as oral traditions. 

However, the most serious flaw with this thought experiment's outcome is its reliance on citations, for two reasons. First, using citations to assess the contributions of previous literature to a commercially viable technology/product is open to manipulation. There is no doubt that the prospect of laying claim to future IP would distort citation practices, and probably for the worse. Secondly, if we assume that citations can be reliably used to trace value back through the knowledge commons, in practice it would be extremely difficult. Using CRISPR-Cas9 as an example, one might begin with the references in its landmark papers, then expand recursively. But citation networks grow exponentially, and there is no clear point at which to stop. Could we stop considering articles as contributing to commercial IP if they were published after a certain timeframe has elapsed? If so, would 50 years be appropriate? Perhaps we might decide to use citation links to draw the line at a defined degree of separation from the research article that an IP NFT represents? Neither of these options are satisfactory as both require defining a boundary that is, ultimately, arbitrary. 

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