Microscopic machinery: moving nanotechnology research into market remains a challenge.

U.S. investments in nanotechnology have escalated into the billions of dollars in recent years. While scientists and analysts agree such funding is advancing nanoscience research, they explained that moving the resulting discoveries and materials into the market remains one of the industry's toughest challenges.

"We have a lot of technology languishing in the lab, because there's not enough resources, both in capital and talent, willing to take this early stage risk," said Scott Mize, president of Foresight Nanotech Institute, a think tank based in San Francisco, Calif. "One of the big structural issues that we've got here in the United States is we sort of have a laissez-faire system for commercialization. We don't have a systematic way to get technologies out of the lab and into commercialization."

What it really requires is a company, usually a small company, to realize the opportunity and go into the lab and put up the money to take it through the steps to produce a product, he said. "I think we need to have more investment in this high-risk, high-reward phase."

Nanotechnology encompasses a broad range of sciences, but it is generally defined as the understanding and control of matter at the one to 100 nanometer scale. A nanometer is one-billionth of a meter.

Since 2001, the U.S. government has funneled about $1 billion a year into nanoscience research and development through the National Nanotechnology Initiative, a federal program that was established to coordinate multi-agency efforts in nanoscale science, engineering and technology.

"The initiative was created by the government to make sure there was enough funding to put money into the science community," said James Murday, executive secretary of the Nanoscale Science Engineering and Technology subcommittee of the National Science and Technology Council, which manages the initiative.

But scientists said the money funds only basic, or 6-1, research and is divided up among numerous agencies, so that in the end there isn't much money left over to commercialize products.

"If we have another nanotech initiative, it should not all be 6-1. There's really a lot of stuff that's ready to move along and a lot of that stuff is a lot nearer term than people think," said Lawrence Kabacoff, program manager in the materials division of the Office of Naval Research.

Murday said it will take time for the investment to show up in products on the market. "It takes roughly 15 years from where we understand the science to where it comes out of the commercial market." The initiative didn't start until 2001, he said, so the technology being pursued in labs today "won't show up for another 10 years."

But Kabacoff has proved that with an adequate amount of money, an integrated team and a focused goal, it is possible to expedite that process in the nanoscience field.

In the mid-1990s, the Navy approached Kabacoff with a problem in its minesweeper fleet. Biological matter accumulated inside the bronze propeller shafts and scored them so badly that the minesweepers were losing their propellers, said Kabacoff. Every 18 months, the Navy would have to pull a minesweeper into dry dock and replace the shaft. The Navy thought his research into wear-resistant coatings might help alleviate the problem.

"Basically what they did was give me a pot of money and say, 'you've got five years to get something into the fleet.' It was focused from the very beginning on the application," he said.

His team developed a nano-ceramic coating of aluminum oxide and titanium oxide that could be sprayed onto the surface of the shafts. The coatings program was part of the Office of Naval Research affordability initiative.

"What we did was we got the fleet people involved in the research and development," said Kabacoff, so that by the end, the people he had to convince to buy into the research were the ones who had been part of it from the start.

"And that worked really well. I try to stick to that model as much as I can. You have to give your customer ownership from the very beginning," he said.

The Navy coated minesweeper propeller shafts with the nanoceramic. A photo taken a few months ago shows little to no scoring. "All I can tell you definitively is that's been on there for four years, and it hasn't failed," said Kabacoff. By not having to pull the minesweepers into dry dock and replace the shafts as before, the Navy is saving $1.5 million a year, he said. His success in the military has led to potential commercial applications. Companies in the oil industry are testing his coatings, he said.

The five-year program, unfortunately, came to an end, he said.

"I wish they'd do it again, because it was a wonderful model. But with money so tight, it's hard to do things like that," he said.

Foresight's Mize said a program in Australia may provide the U.S. with another solution.

The government in Australia provides money that matches private funds on a three to one basis, he said. It then establishes a charter and identifies the technologies that are attempting to negotiate the "valley of death." The funds are managed by venture capitalist firms that agree to continue investing once the technologies cross into the commercialization stage. In the end, the government gets its principal investment back, and the venture capitalist makes a profit.

"This method, in my mind, addresses all the objections that people normally level at having the government being involved," said Mize.

In April, Rep. Mike Honda, D-Calif., introduced the Nano Manufacturing Investment Act, which proposes a similar public-private partnership to help nanotechnologies become commercialized.

At a roundtable forum in San Jose, Calif., in August, he met with representatives from public and private sectors to discuss commercialization of nanotechnology.

"I remain concerned about the federal government's role in helping to commercialize nanotechnology, because I am aware that other nations that we compete against are focusing their federal funding more on the commercialization of nanotechnology. To try to address this problem, I have introduced the Nanomanufacturing Investment Act, which would create a public-private investment partnership that would focus on helping companies bring technologies through the pre-competitive stage and get products to market," he told participants.

"Based on testimony before the House Science Committee and conversations with venture capitalists and manufacturers in the nanotechnology field, we have created a program that is attractive to private investors," he said.

Research and development in nanotechnology has been moving incrementally, said Richard Smith, founder of the Nanotechnology Policy Foundation. But "now we're getting to point where there's enough there. Where you can put out some grand challenges," he said, similar to what President Kennedy did with the race to space. The technology was in place, and Kennedy challenged the country to put a man in space.

The same can be done with nanotechnology, said Smith.

What the National Nanotechnology Initiative is doing is dividing up that money and having problem solving on a small scale, he said.

"I would much rather see something that says, 'our goal is to protect the lives of soldiers. Our goal is to use nanotech to allow everyone in the United States to be covered by health care. NIH, there are your marching orders,' " said Smith.

"We're really at the beginning of the nanotech revolution. But it's clearly here, in the sense that there are commercial products out there," said David Rejeski, director of the Project on Emerging Nanotechnologies, a two-year, $3 million initiative that was launched in April at the Woodrow Wilson International Center for Scholars.

"What we're seeing now are product enhancements," he said, mentioning applications including nanoparticles in sunscreen and cosmetics, nanocomposites in tennis balls and hockey sticks and nanocoatings on clothing and furniture.

"Some of the things that are making it into the field today is based on research that has been going on for 20 years," said Richard Colton, director of the Institute for Nanoscience at the Naval Research Laboratory.

"Nanotechnology already is an enormously large, multibillion industry, and people don't realize it, because they don't associate a lot of things with nanotechnology," said Kabacoff.

Companies that produce products containing nanotechnology are reluctant to tout it as such because of liability issues, said Murday.

As a result, people aren't informed, or know little about it. And that could be a dangerous thing, said Rejeski.

"There's very little information in the public," he said. "The danger is of people being surprised in potentially negative ways."

During the summer, Rejeski conducted focus groups on nanotechnology. When he showed these groups a list of nanotech-enabled products, they were stunned, he said.

"Inventory suggests there's 400 to 500 products that are nanotech-enabled. I think the people tend to see this as something coming down the road. But the fact is, it's here," he said.

The years 2010 to 2020 should be the glow years for nanotechnology, said Murday.

"The products we're seeing now are only the harbingers," he said. "There are some things starting to happen, and the numbers are significant. On the level of dollars being invested in the science and technology, I think it will come back. The technology that's going to come out of this is more than going to repay the science investment."