The University of Oxford received £143 million in royalties from its Covid vaccine in the past academic year – more than all UK universities earned from intellectual property (IP) over the preceding 12 months, new figures show.
Oxford’s Covid jab, which was created, tested and trialled with AstraZeneca in less than a year, was estimated to have saved 6.3 million lives globally in its first year, with more than 2.6 billion doses distributed in 183 countries by March 2022.
But the vaccine also represents a significant revenue stream for Oxford. According to the university’s newly released 2021-22 accounts, it received £143.1 million from the sale of vaccines to developed countries – a sum that surpasses the £133.6 million received by UK universities from IP income in 2020-21, of which Oxford took almost half (£63.3 million), according to Higher Education Statistics Agency data.
When costs of £67 million associated with the Oxford-AstraZeneca vaccine are deducted, namely “payments to third parties for use of vaccine technology”, the university was still left with an additional £76 million, “which will be principally used to fund research going forward”, its annual accounts note.
Overall royalties stood at £216.7 million, up from £64.8 million in 2020-21 – roughly a fifth of overall staff costs at the UK’s oldest university.
The AstraZeneca windfall puts Oxford ahead of many elite US universities famed for their vast income streams: Stanford University recorded licensing revenues of $89 million (£71.9 million) in 2022 and the Massachusetts Institute of Technology reported IP income of $87.4 million.
However, the extraordinary financial bonus is unlikely to continue in future years. “Royalties reduced as the year progressed and as a result significantly lower royalty revenues are expected in 2022-23,” the accounts say, with most developed countries turning to higher-cost mRNA vaccines produced by Moderna and Pfizer over the past year. However, low-income nations will continue to receive the Oxford jab for about £3 a dose, a fifth of the price of Pfizer’s vaccine, on a non-profit basis.
Oxford declined to comment on the latest royalty figures but Timothy Devinney, professor of international business at the University of Manchester, who has advised the Australian government on innovation policy, said the Oxford vaccine illustrated how university-led innovation was likely to require “lots of losses and a small number of huge gains”.
However, the Oxford vaccine was also a rare example of “separable innovation” in which a “discovery can be separated from its commercialisation and hence patented or licensed”, he added. “The vast majority of meaningful commercial innovation is non-separable or combinatorial innovation, where the components must mesh and be co-developed across the value chain of activities,” he added on the challenge faced by universities.
Another challenge was that “really valuable investments will be recognised much earlier by the people doing the work than the university administration. You then have a very strong incentive for those people to move the innovation on to a private account – the university might get a bit of a cut but as the innovation is developed and exploited the bulk of the gain goes to future investors,” he said.
Oxford’s vaccine revenues may be significant but may not have surpassed the overall public investment in the vaccine technology: according to a BMJ Global Health study published in November 2021, total research funding awarded for the ChAdOx technology was £104 million, with major funders including the UK government, the European Commission and the Wellcome Trust, but could be as high as £228 million based on income reported in relevant scientific papers.
