Commercialization strategies for the nanotechnology sector in the United Kingdom

Background  

In recent years, interest in nanotechnology exploded across research communities and industries as varied as pharmacology, material science, life sciences, ICT, transportation, even defense  and space exploration. The global nanomaterials market of 11 million tons is currently valued at €20bn, employing 300,000-400,000 people in Europe alone. Nano-enabled products reached €200bn worldwide in 2009, expecting to reach €2 trillion by 2015.

Emergence and exponential growth of a disruptive technology call for a systematized approach by the government, assessing national situation, product potential, and growth prospects through a national nanotechnology strategy policy. The Royal Society report of 2004, the 2002 and 2010 Department for Business, Innovation & Skills (BIS) reports,  the Engineering and Physical Sciences Research Council (EPSRC) 2006 and the 2010 Nanotechnology Mini-Innovation and Growth Team (Mini-IGT) report,  as well as the Technology Strategy Board’s Strategy 2009-2012 tried to address these issues, as did EU bodies.   But already by 2015, their recommendations and assessment seem outdated and in need of reformulation. This overview presents current views on nanotechnology in the UK along with issues to be considered in formulating national nanotechnology strategy.

Ethical Issues

Nanotechnology’s interdisciplinary nature with applications spanning life sciences and material science in areas like construction, textiles, military uses, ICT, space exploration presents unique ethical and regulatory challenges. Professional ethics guidelines   may inadequately address interdisciplinary aspects of emerging technologies like nanotechnology. Yet, singling out nanotechnology to require separate ethical guidelines threatens clamor for similar exceptions in other fields, increasing pressure on existing guiding principles. The precautionary principle as a means of minimizing unexplored health and environmental hazards of nanotechnology (postulated by the EU legislation as an “integrated, safe and responsible approach” especially in REACH, and by Greenpeace) requires balancing with the economic and industrial needs of modern nations and public expectations for technological advancement, e.g., new drugs and improved products. Corporate interests need balancing with those of the general public, while concentration of R&D but also application of nanotechnology in highly industrialized nations threaten to increase inequality and uneven distribution of advanced goods, hence of wealth. That may result in uneven distribution of benefits and risks: upper layers of society potentially reap the benefits of nano-enhanced drugs and products while lower strata likely absorb its costs of environmental hazards. A sustainable nanotechnology strategy must take all such consequences into consideration.

Nanotechnology and Society

As a potentially disruptive technology, nanotechnology will significantly affect society on several levels through advances in healthcare (e.g., human enhancement, prosthetics, nano-enabled drugs), environmental remediation, renewable energy (e.g., photovoltaic cells), novel materials (e.g., graphenes, carbon nanotubes), improvement of characteristics of existing materials (e.g., nanocoating, thin films), ICT solutions (e.g., hard drives, RFIDs), but also health risks and environmental pollution. Its challenge consists of reconciling various stakeholders’ divergent interests affected by the advent of nanotechnology: scientists, entrepreneurs, investors, environmentalists, government and the general public. 

Previous reports of BIS and various think tanks  paid particular attention to the public’s role in formulating nanotechnology development strategy. Initiatives went as far as dedicating public resources to establish NanoJuries,   Nanodialogues and Citizens Forums  as tools for gathering public input on nanotechnology. But since the public is already represented by the democratic institutions of government controlled by elected representatives, this approach is inefficient: members of the general public lack both scientific and policy qualifications to knowledgably influence national strategy on emerging technologies, although they are both prospective beneficiaries and bearers of potential risks such as environmental and health costs of new technologies. Under a more paternalistic approach, resources for polling public opinion would find better use supporting regulatory measures to ensure safety of manufactured products, especially safe end-of-life disposal or containment. Input from other stakeholders in the nanotechnology debate (enterprises, researchers, government representing taxpayers’ interests) suffices to influence national strategy for nanotechnology without neglecting input from special interest groups (environmentalists, NGOs, civic organizations.)  General public awareness of nanotechnology’s benefits and risks may be increased through educational campaigns fool-proofed against hypes or hoaxes by populist media influence.
 

Funding Models for Research and Development

Funding for nanotechnology R&D comes from public and private sources. In 2011, governments worldwide spent USD 10bn on nanotechnology R&D (UK: below USD 250m). In 2015, public and private funding for nanotechnology R&D is expected to reach USD 250bn.

Public financing originates from domestic and EU sources. The UK government supports nanotechnology R&D through the Research Councils’ UK Nanoscience Programme     and Technology Strategy Board programs. EU financing comes from EU Framework Programmes (FP4 though FP7, with FP7 total 2007-2013 budget of €50.5bn, followed by Horizon 2020) and mixed ENIAC funding. Private financing originates from banks, investment funds, private investors and charities.

Startups and Small and Medium Enterprises (SMEs) typically use a mix of public and private financing and IPOs as an exit option and to attract additional investment. Large enterprises dedicate to R&D a percentage of sales of established product lines.  Universities and research institutions fund nanotechnology R&D through grants, endowment resources, and industry support.

Significant private funding usually requires advanced tangible research results and high commercialization potential promising a stream of income within 2-5 years. Thus, public R&D funding remains the financing method of choice for nanotechnology startups in spite of its serious shortcomings regarding volume and bureaucratic requirements.  

Health and Environmental Impact

Nanotechnology holds great promises for improvement of health and longevity, but also for environmental remediation.  However, numerous studies point to environmental and health risks of nanoparticles. Environmental groups such as Greenpeace, but also the EC   and public figures  have raised concerns. Environmental and health impacts of nanotechnology are little understood.  Both seem correlated with the ability of nanoparticles to penetrate the skin and blood/brain barriers but also with size and surface properties of nanoparticles that can be neutral or highly toxic to living cells or entire organisms.  

Nanoremediation presents an environmental dilemma: it promises to clean up hazardous waste such as Superfund sites locally, cheaply, effectively, and with little secondary contamination; however, nanoparticles released into the environment raise concerns about far-reaching unintended consequences for distant yet connected ecosystems, like ocean life.   

While a moratorium on use and release of nanoparticles proposed by Greenpeace seems an exaggerated measure that ignores today’s widespread use of nano-enabled products, more studies are needed to determine the extent of health and environmental hazards of nanotechnology and balance them with its benefits. Remediation and prevention procedures should be developed as part of standard industry practices, especially in the context of waste management and end-of-life product cycles. Manufacturing restrictions should be placed on nanoparticles with particularly toxic or dangerous specifications.

Other Relevant Issues

Another issue for national nanotechnology strategy is allocation of its direct and indirect cost. Policy needs to balance the needs of industry and of the general public. Governmental priorities (economic development, industrialization, technological leadership) are closely aligned with those of industry. But securing voter support for policies and for elected officials requires visible protection of the public interest. As for nanotechnology, the public must be educated about risks and benefits to prevent popular distrust from stifling industry by regulatory concessions forced by populists, as was the case with GMOs and stem cell research. The cost of education and of satisfaction of the precautionary principle need to be borne directly by the taxpayer - the ultimate beneficiary. This contrasts with BIS 2010 recommendations that burdened industry with the cost of nanotechnology-related PR efforts and with the consequences of the precautionary principle. Such heightened expense for social acceptance - ultimately passed on to consumers anyway - has chilling effects on the development and application of nanotechnology by established enterprises, but especially by startups. It puts domestic industry at a competitive disadvantage vis-à-vis foreign manufacturers not burdened by UK standards more stringent than in the rest of the EU or the world.