Royalties and other income from licensing its technology soared to nearly double previous record years for Nationwide Children's Hospital, driven largely by increasing global sales of one of the first gene therapies ever approved for use in humans.
The Columbus pediatric hospital had $68.9 million in revenue from royalties, milestone payments and other forms of income from spinning out startups or licensing patents to outside companies, said Matt McFarland, vice president of commercialization and industry relations.
"They're good numbers for an organization our size," he said. This year also is shaping up as strong for revenue.
That money gets poured back into research and resources to incubate and commercialize technologies developed at its Wexner Research Institute and the clinical operation, McFarland said. Children's latest strategic plan calls for recruiting 50 new faculty, all with the potential for more invention.
The main contributor to income is Zolgensma, which halts progression of a fatal degenerative muscular condition in infants. Launched in mid-2019 and licensed to Novartis Corp. (NYSE: NVS), Zolgensma last year generated $1.35 billion in global sales, according to the pharmaceutical company's annual report, a 47% increase over the prior year. The amount of royalties to Children's is not disclosed.
A second major revenue sources and several other deals also are not yet in the public domain, McFarland said. Children's is in the process of spinning out another gene therapy startup.
Clarametyx Biosciences Inc., which spun out in 2020 to develop a novel method of fighting antibiotic-resistant infections, is making "tremendous progress," he said.
The hospital reported 72 new invention disclosures, which is when an employee first approaches the commercialization office to start exploring a patent or otherwise develop an idea, and completed 18 commercialization deals.
Numbers of active deals predictably declined from 2020, when Children's spun off gene therapy manufacturer Andelyn Biosciences Inc. and its intellectual property along with it.
"It does leave a slight gap for us we're backfilling right now," McFarland said.
Children's recently created a "targeted innovation fund" dedicated to inventions by clinical staff such as nurses and physicians. While most deals emerge from the research staff, in the past the commercialization office has paid for things such as a scale model of a clinician-developed IV stand that works better with wheelchairs.
The hospital is preparing its report for the annual fall research commercialization survey of AUTM. Children's first participated in 2015, after several years with less than $1 million in revenue, but in recent years skyrocketed to the top earner in Ohio.
Overall Children's had operating income of $315 million on $3.5 billion revenue in 2021, according to its audit.
