Small companies thinking big reap the rewards of research

27th September 2021

Ireland’s knowledge transfer system put in a robust performance last year with improvements under different markers indicating continued strong research and development (R&D) activity, according to a new survey.

The Annual Knowledge Transfer Survey is a scorecard for Ireland’s knowledge transfer performance that assesses the engagement and commercialisation activity between industry and publicly funded research as well as looking at the outcomes of the collaborations.

Published by Knowledge Transfer Ireland along with the Higher Education Authority, the survey is based on submissions from 24 research-performing organisations (RPOs), namely Ireland’s eight universities, two technological universities, nine institutes of technology and two colleges, as well as Teagasc, the Marine Institute, and for the first time, Irish Manufacturing Research (IMR).

The director of Knowledge Transfer Ireland, Alison Campbell, says that the innovation offices in the third-level and wider research system didn’t know what to expect in the first half of 2020. Companies were focusing on the immediate challenges brought by the pandemic, while researchers weren’t able to access labs on campus.

It soon emerged that companies were still interested in R&D collaborations, which became apparent in many other countries too. There were, of course, changes for some sectors, such as aviation, but there was a general appetite to continue to develop new R&D partnerships.

The number of research projects taking place between companies and the RPOs is a very good gauge of RD&I activity. In 2020 1,386 new R&D agreements were signed, representing new projects involving 1,088 companies. When access to expertise through consultancy agreements is added into the mix, a total of 2,066 new contracts were signed with companies last year. The survey indicates that Irish SMEs continue to be very active in this space, accounting for 73 per cent of collaboration agreements between industry and RPOs.

Campbell notes that companies are not the only organisations to benefit from the expertise available in the research base. Non-commercial entities, such as non-governmental organisations, charities, public sector bodies and others, are increasingly engaging with RPOs. The survey recorded 477 collaborative research agreements signed with non-commercial entities during 2020. This, Campbell says, is a reflection of the wider value-add from research that is often overlooked, despite Irish researchers across the disciplines being well engaged externally.

When taking the commercial and non-commercial sectors together, there was a massive 39 per cent increase in the number of new engagements with Irish public research between 2019 and 2020. This brings to 3,681 the number of new agreements signed last year, a figure Campbell describes as impressive, particularly because it involves only 24 RPOs. The commercial outputs from the research base also continued to flow. Thirty-nine new products or services – which provide solution to real=world problems across a wide range of sectors, including software, diagnostics, energy, digitalisation and plan varieties – were launched to the market in 2020 as a direct result of engagement between companies and publicly funded research. This compares with 26 new launches in 2019.

A total of 247 products and services have been brought to market since Knowledge Transfer Ireland began publishing the survey in 2013.

Companies and RPOS have continued to execute on the licences that underpin company access to new technology and intellectual property. Over the past five years 975 licences have been issued by RPOs, of which 197 were signed last year. Aggregate revenue to RPOs from licensing in 2020 was €2.3 million, compared with €2.7m million in 2019.

At 30, the number of spin-out companies formed last year from universities, institutes of technology and other research bodies was also higher than the five-year average of 28 a year. In total, 140 new spin-outs have been created over the past five years.

In addition, nine companies that began life as spin-outs were acquired last year, with a combined total revenue of €7.8million realised from sale of equity.

The survey also reveals that Ireland’s 128 active spin-out companies (firms that have been incorporated for three years or more) employ 1,112 people between them. Campbell says that this is a conservative estimate and doesn’t take into account any jobs related to spin-outs that have been acquired over the years. She points out that post-acquisition companies frequently continue to have a significant presence in Ireland and often remain close to the source of initial research. The Novozymes acquisition of PrecisionBiotics in Cork last year is a case in point.

As regards revenue to the RPOs from commercialisation activities, 85 per cent was derived from collaborative research with companies, while 9 per cent came from licensing, equity sales and dividends. Campbell says that this skew of income isn’t unusual for RPOs internationally and commercial revenue is the icing on the cake, rather than a predictable budget line. What it does show is the extent of external research engagement by the research base and its perceived value to companies.

The survey records research expenditure, which is the amount the RPO spends on research in the year rather than the value of any research grants and contracts won in the year. Last year this amounted to €636 million, the same as in 2019, which suggests a drop in real terms as IMR, with research expenditure of €9 million, was not included previously.

Universities accounted for €484 million, or 76 per cent of the total, the technological higher education sector spent €84 million (13 per cent) and colleges and state research bodies spent €68 million (11 per cent). The formation of the technological universities is expected to result in a rise in research activity over the next few years. “Events of the last 18 months have shown how vital an engaged and proactive knowledge transfer community is,” Campbell says.

“With significant increases in live collaboration projects, new products and services launched and new jobs in spin-out companies to name a few, it is clear that Irish enterprises recognise the very real part that working with the research base on R&D can play in helping them innovate their business for the future.”

“The continued engagement of the SME sector is particularly notable, given the year we have had, and is encouraging as we know that those who collaborate with RPOs on R&D are proven to be more competitive than those who don’t.”

 Source: The Times