Egypt’s President Said to Limit Scope of Judicial Decree

CAIRO — President Mohamed Morsi agreed Monday to scale back a sweeping decree he had issued last week that raised his edicts above any judicial review, according to a report by a television network allied with his party. The agreement, reached with top judicial authorities, would leave most of Mr. Morsi’s actions subject to review by the courts, but preserve a crucial power: protecting the constitutional council from being dissolved by the courts before it finishes its work.

Ahmed Jadallah/Reuters

Protesters ran for cover during clashes with riot police at Tahrir square in Cairo on Monday.

Tara Todras-Whitehill for The New York Times

Egyptians mourned Mohammed Gaber Salah, an activist who died Sunday from injuries sustained during protests, before his funeral on Monday in Cairo.

The Muslim Brotherhood, the Islamist group that sponsored Mr. Morsi and his party, announced that it was canceling a major demonstration in support of the president that had been planned for Tuesday.

Cracks appeared in Mr. Morsi’s government on Sunday over the decree after the justice minister, Ahmed Mekki, began arguing publicly for a retreat, and at least three other senior advisers resigned over the measure. The move had also prompted widening street protests and cries from opponents that Mr. Morsi, who already governs without a legislature, was moving toward a new autocracy in Egypt, less than two years after the ouster of the strongman Hosni Mubarak.

With a threatened strike by the nation’s judges, a plunge in the country’s stock market and more street protests looming, Mr. Morsi’s administration initially sent mixed messages on Sunday over whether it was willing to consider a compromise: a spokesman for the president’s party insisted that there would be no change in his edict, but a statement from the party indicated for the first time a willingness to give political opponents “guarantees against monopolizing the fateful decisions of the homeland in the absence of the Parliament.”

Mr. Mekki, the influential leader of a judicial independent movement under Mr. Mubarak and one of Mr. Morsi’s closest aides, actively tried to broker a deal with top jurists to resolve the crisis.

The reaction to the decree had presented the most acute test to date of the ability and willingness of Mr. Morsi, Egypt’s first freely elected president and a former leader of the Muslim Brotherhood, to engage in the kind of give and take that democratic government requires. But he also must contend with real doubts about the willingness of his anti-Islamist opponents to join him in compromise. Each side is mired in deep suspicion of the other, a legacy of the decades when the Brotherhood survived here only as an insular secret society, demonized as dangerous radicals by most of the Egyptian elite.

“There is a deep mistrust,” said Emad Shahin, a political scientist at the American University in Cairo who studies the Brotherhood. “It is an ugly round of partisan politics,” he said, “a bone-crushing phase.”

The scale of the backlash against the decree appeared to catch Mr. Morsi’s government by surprise. “In his head, the president thought that this would push us forward, but then it was met with all this inflammation,” Mr. Mekki said. He faulted the president for failing to consult with his opponents before issuing it, but he also faulted the opponents for their own unwillingness to come to the table: “I blame all of Egypt, because they do not know how to talk to each other.”

Government and party officials maintained that Mr. Morsi was forced to claim the expansive new powers to protect the process of writing the country’s new constitution, and that the decree would be in effect only until the charter was in place. A court of judges appointed under the Mubarak government was widely rumored to be about to dissolve the elected constitutional assembly, dominated by Mr. Morsi’s Islamist allies — just as the same court had previously cast out the newly elected Islamist-led Parliament — and the decree issued by Mr. Morsi on Thursday gave him the power to stop it.

“I see with all of you, clearly, that the court verdict is announced two or three weeks before the court session,” Mr. Morsi told his supporters on Friday, referring to the pervasive rumors about the court’s impending action in a fiery speech defending his decree. “We will dissolve the entire homeland, as it seems! How is that? How? Those waywards must be held accountable."

He said that corrupt Mubarak loyalists were “hiding under the cover of the judiciary” and declared, “I will uncover them!”

But instead of rallying the public to his side and speeding the country’s political transition, as Mr. Morsi evidently hoped, his decree has unleashed new instability across the country. On Sunday, the first day of business here since the decree was issued, the Egyptian stock market fell by about 9.5 percent, erasing more than $4 billion of value.

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G.E. Looks to Industry for the Next Digital Disruption

SAN RAMON, Calif. — When Sharoda Paul finished a postdoctoral fellowship last year at the Palo Alto Research Center, she did what most of her peers do — considered a job at a big Silicon Valley company, in her case, Google. But instead, Ms. Paul, a 31-year-old expert in social computing, went to work for General Electric.

Ms. Paul is one of more than 250 engineers recruited in the last year and a half to G.E.’s new software center here, in the East Bay of San Francisco. The company plans to increase that work force of computer scientists and software developers to 400, and to invest $1 billion in the center by 2015. The buildup is part of G.E’s big bet on what it calls the “industrial Internet,” bringing digital intelligence to the physical world of industry as never before.

The concept of Internet-connected machines that collect data and communicate, often called the “Internet of Things,” has been around for years. Information technology companies, too, are pursuing this emerging field. I.B.M. has its “Smarter Planet” projects, while Cisco champions the “Internet of Everything.”

But G.E.’s effort, analysts say, shows that Internet-era technology is ready to sweep through the industrial economy much as the consumer Internet has transformed media, communications and advertising over the last decade.

In recent months, Ms. Paul has donned a hard hat and safety boots to study power plants. She has ridden on a rail locomotive and toured hospital wards. “Here, you get to work with things that touch people in so many ways,” she said. “That was a big draw.”

G.E. is the nation’s largest industrial company, a producer of aircraft engines, power plant turbines, rail locomotives and medical imaging equipment. It makes the heavy-duty machinery that transports people, heats homes and powers factories, and lets doctors diagnose life-threatening diseases.

G.E. resides in a different world from the consumer Internet. But the major technologies that animate Google and Facebook are also vital ingredients in the industrial Internet — tools from artificial intelligence, like machine-learning software, and vast streams of new data. In industry, the data flood comes mainly from smaller, more powerful and cheaper sensors on the equipment.

Smarter machines, for example, can alert their human handlers when they will need maintenance, before a breakdown. It is the equivalent of preventive and personalized care for equipment, with less downtime and more output.

“These technologies are really there now, in a way that is practical and economic,” said Mark M. Little, G.E.’s senior vice president for global research.

G.E.’s embrace of the industrial Internet is a long-term strategy. But if its optimism proves justified, the impact could be felt across the economy.

The outlook for technology-led economic growth is a subject of considerable debate. In a recent research paper, Robert J. Gordon, a prominent economist at Northwestern University, argues that the gains from computing and the Internet have petered out in the last eight years.

Since 2000, Mr. Gordon asserts, invention has focused mainly on consumer and communications technologies, including smartphones and tablet computers. Such devices, he writes, are “smaller, smarter and more capable, but do not fundamentally change labor productivity or the standard of living” in the way that electric lighting or the automobile did.

But others say such pessimism misses the next wave of technology. “The reason I think Bob Gordon is wrong is precisely because of the kind of thing G.E. is doing,” said Andrew McAfee, principal research scientist at M.I.T.’s Center for Digital Business.

Today, G.E. is putting sensors on everything, be it a gas turbine or a hospital bed. The mission of the engineers in San Ramon is to design the software for gathering data, and the clever algorithms for sifting through it for cost savings and productivity gains. Across the industries it covers, G.E. estimates such efficiency opportunities at as much as $150 billion.

Some industrial Internet projects are already under way. First Wind, an owner and operator of 16 wind farms in America, is a G.E. customer for wind turbines. It has been experimenting with upgrades that add more sensors, controls and optimization software.

The new sensors measure temperature, wind speeds, location and pitch of the blades. They collect three to five times as much data as the sensors on turbines of a few years ago, said Paul Gaynor, chief executive of First Wind. The data is collected and analyzed by G.E. software, and the operation of each turbine can be tweaked for efficiency. For example, in very high winds, turbines across an entire farm are routinely shut down to prevent damage from rotating too fast. But more refined measurement of wind speeds might mean only a portion of the turbines need to be shut down. In wintry conditions, turbines can detect when they are icing up, and speed up or change pitch to knock off the ice.

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Hospitals Face Pressure From Medicare to Avert Readmissions

After years of gently prodding hospitals to make sure discharged patients do not need to return, the federal government is now using its financial muscle to discourage readmissions.

Medicare last month began levying financial penalties against 2,217 hospitals it says have had too many readmissions. Of those hospitals, 307 will receive the maximum punishment, a 1 percent reduction in Medicare’s regular payments for every patient over the next year, federal records show.

One of those is Barnes-Jewish Hospital in St. Louis, which will lose $2 million this year. Dr. John Lynch, the chief medical officer, said Barnes-Jewish could absorb that loss this year, but “over time, if the penalties accumulate, it will probably take resources away from other key patient programs.”

The crackdown on readmissions is at the vanguard of the Affordable Care Act’s effort to eliminate unnecessary care and curb Medicare’s growing spending, which reached $556 billion this year. Hospital inpatient costs make up a quarter of that spending and are projected to grow by more than 4 percent annually in coming years, according to the Congressional Budget Office.

The readmission penalties will recoup about $300 million this year. But the goal is to pressure hospitals to pay attention to what happens to their patients after they walk out the door. The penalties have captured the attention of hospitals, and many are trying to improve their supervision of discharged patients’ recoveries.

“I’ve been doing this for over two decades and talking to hospital leaders about readmissions, and I used to get polite but blank stares,” said Dr. Eric Coleman, a professor at the University of Colorado Anschutz Medical Campus who has devised widely adopted methods to reduce hospitalizations. “Now they’re paying attention.”

With nearly one in five Medicare patients returning to the hospital within a month — about two million people a year — readmissions cost the government more than $17 billion annually.

Hospitals’ traditional reluctance to tackle readmissions is rooted in Medicare’s payment system. Medicare generally pays hospitals a set fee for a patient’s stay, so the shorter the visit, the more revenue a hospital can keep. Hospitals also get paid when patients return. Until the new penalties kicked in, hospitals had no incentive to make sure patients didn’t wind up coming back. The maximum penalty is set to double next October and then reach 3 percent of reimbursements in October 2015. Medicare also is expanding the list of conditions it will assess in setting punishments.

Right now it only evaluates readmissions of heart attack, heart failure and pneumonia patients, counting every rebound, even ones not related to the original reason for hospitalization. The penalties are based on readmission rates in the past and applied to future payments for all Medicare patients.

Researchers say that while some readmissions are unavoidable, many are caused by the short shrift hospitals have given patients on their way out.

Jonathan Blum, principal deputy administrator for the Centers for Medicare and Medicaid Services, said the penalties had helped galvanize hospitals’ efforts to avoid readmissions. “We’ve seen a small but significant reduction,” he said. “That tells me we’ve focused the industry on improvement.”

Medicare’s tough love is not going over well everywhere. Academic medical centers are complaining that the penalties do not take into account the extra challenges posed by extremely sick and low-income patients. For these people, getting medicine and follow-up care can be a struggle.

At Barnes-Jewish Hospital, Dr. Lynch said physicians from all over the Midwest referred their sickest heart patients to his facility for transplants and other major interventions. But those patients can skew his hospital’s readmissions numbers, he said: “The weaker your heart, the more advanced your emphysema, the more likely you are to be readmitted to the hospital.”

Dr. Lynch said Barnes-Jewish set up follow-up appointments for patients who didn’t have their own doctors. But about half of the patients never showed up, he said, even after the hospital made reminder phone calls and arranged for free rides. Sending nurses to see patients at home did not significantly reduce readmission rates either, he said.

“Many of us have been working on this for other reasons than a penalty for many years, and we’ve found it’s very hard to move,” Dr. Lynch said. He said the penalties were unfair to hospitals with the double burden of caring for very sick and very poor patients.

“For us, it’s not a readmissions penalty,” he said. “It’s a mission penalty.”

Various studies, including one commissioned by Medicare, have found that the hospitals with the most poor and African-American patients tended to have higher readmission rates than hospitals with more affluent and Caucasian patients. But the studies also determined that some safety-net hospitals performed better than average, showing that hospitals can overcome the challenges posed by the kinds of patients they treat.

In some ways, the debate parallels the one on education — specifically, whether educators should be held accountable for lower rates of progress among children from poor families.

“Just blaming the patients or saying ‘it’s destiny’ or ‘we can’t do any better’ is a premature conclusion and is likely to be wrong,” said Dr. Harlan Krumholz, director of the Center for Outcomes Research and Evaluation at Yale-New Haven Hospital, which prepared the study for Medicare. “I’ve got to believe we can do much, much better.”

Some researchers fear the Medicare penalties are so steep, they will distract hospitals from other pressing issues, like reducing infections and surgical mistakes and ensuring patients’ needs are met promptly. “It should not be our top priority,” said Dr. Ashish Jha, a professor at the Harvard School of Public Health who has studied readmissions. “If you think of all the things in the Affordable Care Act, this is the one that has the biggest penalties, and that’s just crazy.”

With pressure to avert readmissions rising, some hospitals have been suspected of sending patients home within 24 hours, so they can bill for the services but not have the stay counted as an admission. But most hospitals are scrambling to reduce the number of repeat patients, with mixed success.

A few days after Eda Laurion was discharged from the Banner Del E. Webb Medical Center near Phoenix after treatment for her congestive heart failure in August, a nurse showed up at her house.

“She helped explained the medicines I’m taking, the side effects, what they do for you,” said Ms. Laurion, 91, of Sun City West.

Still, readmissions can’t always be prevented. The nurse, Sue Koner, sent Ms. Laurion back to the hospital after two weeks for dangerously low sodium caused by an undiagnosed kidney problem. However, Ms. Laurion avoided re-hospitalization in October when Ms. Koner deduced that her hallucinations were a reaction to an antibiotic.

Overseeing former patients is expensive and time-consuming, so many hospitals are relying on financing from community health organizations and foundations. Ms. Koner works for Sun Health, a foundation-supported nonprofit. Since Sun Health started its program in November 2011, only nine of 213 patients have been readmitted.

Dr. Krumholz said hospitals should think of readmissions as a challenge to overcome. “One day, we’ll look back,” he said, “and we’ll be incredulous that one out of every five patients ended up back in the hospital.”

This article was produced in collaboration with Kaiser Health News, an editorially independent program of the Kaiser Family Foundation.

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Hospitals Face Pressure From Medicare to Avert Readmissions

After years of gently prodding hospitals to make sure discharged patients do not need to return, the federal government is now using its financial muscle to discourage readmissions.

Medicare last month began levying financial penalties against 2,217 hospitals it says have had too many readmissions. Of those hospitals, 307 will receive the maximum punishment, a 1 percent reduction in Medicare’s regular payments for every patient over the next year, federal records show.

One of those is Barnes-Jewish Hospital in St. Louis, which will lose $2 million this year. Dr. John Lynch, the chief medical officer, said Barnes-Jewish could absorb that loss this year, but “over time, if the penalties accumulate, it will probably take resources away from other key patient programs.”

The crackdown on readmissions is at the vanguard of the Affordable Care Act’s effort to eliminate unnecessary care and curb Medicare’s growing spending, which reached $556 billion this year. Hospital inpatient costs make up a quarter of that spending and are projected to grow by more than 4 percent annually in coming years, according to the Congressional Budget Office.

The readmission penalties will recoup about $300 million this year. But the goal is to pressure hospitals to pay attention to what happens to their patients after they walk out the door. The penalties have captured the attention of hospitals, and many are trying to improve their supervision of discharged patients’ recoveries.

“I’ve been doing this for over two decades and talking to hospital leaders about readmissions, and I used to get polite but blank stares,” said Dr. Eric Coleman, a professor at the University of Colorado Anschutz Medical Campus who has devised widely adopted methods to reduce hospitalizations. “Now they’re paying attention.”

With nearly one in five Medicare patients returning to the hospital within a month — about two million people a year — readmissions cost the government more than $17 billion annually.

Hospitals’ traditional reluctance to tackle readmissions is rooted in Medicare’s payment system. Medicare generally pays hospitals a set fee for a patient’s stay, so the shorter the visit, the more revenue a hospital can keep. Hospitals also get paid when patients return. Until the new penalties kicked in, hospitals had no incentive to make sure patients didn’t wind up coming back. The maximum penalty is set to double next October and then reach 3 percent of reimbursements in October 2015. Medicare also is expanding the list of conditions it will assess in setting punishments.

Right now it only evaluates readmissions of heart attack, heart failure and pneumonia patients, counting every rebound, even ones not related to the original reason for hospitalization. The penalties are based on readmission rates in the past and applied to future payments for all Medicare patients.

Researchers say that while some readmissions are unavoidable, many are caused by the short shrift hospitals have given patients on their way out.

Jonathan Blum, principal deputy administrator for the Centers for Medicare and Medicaid Services, said the penalties had helped galvanize hospitals’ efforts to avoid readmissions. “We’ve seen a small but significant reduction,” he said. “That tells me we’ve focused the industry on improvement.”

Medicare’s tough love is not going over well everywhere. Academic medical centers are complaining that the penalties do not take into account the extra challenges posed by extremely sick and low-income patients. For these people, getting medicine and follow-up care can be a struggle.

At Barnes-Jewish Hospital, Dr. Lynch said physicians from all over the Midwest referred their sickest heart patients to his facility for transplants and other major interventions. But those patients can skew his hospital’s readmissions numbers, he said: “The weaker your heart, the more advanced your emphysema, the more likely you are to be readmitted to the hospital.”

Dr. Lynch said Barnes-Jewish set up follow-up appointments for patients who didn’t have their own doctors. But about half of the patients never showed up, he said, even after the hospital made reminder phone calls and arranged for free rides. Sending nurses to see patients at home did not significantly reduce readmission rates either, he said.

“Many of us have been working on this for other reasons than a penalty for many years, and we’ve found it’s very hard to move,” Dr. Lynch said. He said the penalties were unfair to hospitals with the double burden of caring for very sick and very poor patients.

“For us, it’s not a readmissions penalty,” he said. “It’s a mission penalty.”

Various studies, including one commissioned by Medicare, have found that the hospitals with the most poor and African-American patients tended to have higher readmission rates than hospitals with more affluent and Caucasian patients. But the studies also determined that some safety-net hospitals performed better than average, showing that hospitals can overcome the challenges posed by the kinds of patients they treat.

In some ways, the debate parallels the one on education — specifically, whether educators should be held accountable for lower rates of progress among children from poor families.

“Just blaming the patients or saying ‘it’s destiny’ or ‘we can’t do any better’ is a premature conclusion and is likely to be wrong,” said Dr. Harlan Krumholz, director of the Center for Outcomes Research and Evaluation at Yale-New Haven Hospital, which prepared the study for Medicare. “I’ve got to believe we can do much, much better.”

Some researchers fear the Medicare penalties are so steep, they will distract hospitals from other pressing issues, like reducing infections and surgical mistakes and ensuring patients’ needs are met promptly. “It should not be our top priority,” said Dr. Ashish Jha, a professor at the Harvard School of Public Health who has studied readmissions. “If you think of all the things in the Affordable Care Act, this is the one that has the biggest penalties, and that’s just crazy.”

With pressure to avert readmissions rising, some hospitals have been suspected of sending patients home within 24 hours, so they can bill for the services but not have the stay counted as an admission. But most hospitals are scrambling to reduce the number of repeat patients, with mixed success.

A few days after Eda Laurion was discharged from the Banner Del E. Webb Medical Center near Phoenix after treatment for her congestive heart failure in August, a nurse showed up at her house.

“She helped explained the medicines I’m taking, the side effects, what they do for you,” said Ms. Laurion, 91, of Sun City West.

Still, readmissions can’t always be prevented. The nurse, Sue Koner, sent Ms. Laurion back to the hospital after two weeks for dangerously low sodium caused by an undiagnosed kidney problem. However, Ms. Laurion avoided re-hospitalization in October when Ms. Koner deduced that her hallucinations were a reaction to an antibiotic.

Overseeing former patients is expensive and time-consuming, so many hospitals are relying on financing from community health organizations and foundations. Ms. Koner works for Sun Health, a foundation-supported nonprofit. Since Sun Health started its program in November 2011, only nine of 213 patients have been readmitted.

Dr. Krumholz said hospitals should think of readmissions as a challenge to overcome. “One day, we’ll look back,” he said, “and we’ll be incredulous that one out of every five patients ended up back in the hospital.”

This article was produced in collaboration with Kaiser Health News, an editorially independent program of the Kaiser Family Foundation.

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DealBook: Mortgage Interest Deduction Is Now Seen as Vulnerable

A tax break that has long been untouchable could soon be in for some serious manhandling.

Many home buyers deduct their mortgage interest when assessing their tax bill, a perk that has helped bolster the income of millions of families — and the broader housing market.

But as President Obama and Congress try to hash out a deal to reduce the budget deficit, the mortgage interest deduction looks vulnerable. Limits on a broad array of deductions could emerge in any budget deal. It is likely that any caps would be structured to aim at high-income households, and would diminish or end the mortgage tax break for many of those taxpayers.

“This is definitely a chance worth jumping for,” said Amir Sufi, a professor at the Booth School of Business at the University of Chicago. “For a fixed amount of revenue, it’s better to remove deductions than increase marginal tax rates.”

Such a move would be fiercely opposed by the real estate industry. The industry has played a crucial role in defending the tax break, even as other countries with high homeownership have phased it out.

Housing market players who oppose any whittling down of the mortgage deduction still have time to press their case. If President Obama and Congress manage to reach an agreement to avoid the looming tax raises and spending cuts, their deal will be broad in nature. Then, over the following months, Congress will hash out details, like any caps on deductions.

“Until Congress introduces specific legislation, there’s nothing to say about any proposed changes to the mortgage interest deduction,” Gary Thomas, president of the National Association of Realtors, said in an e-mailed statement. “However, it has always been the N.A.R.’s position that the mortgage interest deduction is vital to the stability of the American housing market and economy, and we will remain vigilant in opposing any future plan that modifies or excludes the deductibility of mortgage interest.”

One of the reasons the mortgage tax break is so vulnerable is that both Democrats and Republicans have recently favored capping deductions, including both President Obama and the recent Republican presidential nominee, Mitt Romney.

What is more, deductions could be used to grease a compromise in the budget negotiations. High earners would be hit most by deduction limits, something that might make Republicans recoil. But the party may tolerate such a policy in return for a deal that limits how much actual tax rates go up for high-income households.

Tax numbers suggest it may not be hard to structure deduction limits in a way that leaves most middle-income households untouched.

With the mortgage interest deduction, households realized tax savings of $83 billion in 2010, according to figures from the Reason Foundation. Nearly $65 billion, or 78 percent of those savings, went to households earning $100,000 or more.

There are a range of ways to increase tax revenue by aiming at higher earners, some less comprehensive than others. For instance, the interest deduction relating to second homes could be ended. Also, the cap on mortgage debt eligible for the interest rate deduction — currently $1 million — could be reduced.

There are broader approaches, too. In its proposed budget, the Obama administration plans to focus on top earners. The administration suggests capping deductions at 28 percent for high-income households, those earning more than $250,000.

Under the current rules, a high-earning household deducting $20,000 in interest payments would probably apply a 35 percent rate to that amount and receive $7,000 in tax savings. The Obama budget aims to limit that tax saving by capping that rate at 28 percent. If that rate were applied to $20,000 of interest payments, the saving would fall to $5,800.

The United States would capture the difference. Over the next 10 years, that 28 percent cap could increase tax revenue by $584 billion, according to the Treasury Department.

Separately, the Obama administration also wants to limit high earners’ deductions by letting certain Bush-era exemptions expire. Altogether, the Treasury Department thinks it could raise $749 billion over 10 years by limiting deductions for higher earners. That’s substantially more than the $684 billion it thinks it could raise from increasing their tax rates.

Still, there are situations where certain middle-income earners do get hit by deduction limits.

Consider a policy that uses a dollar limit, and caps all deductions at $35,000. That amount would be plenty to cover most middle-income households’ mortgage interest, state and local taxes and charitable giving.

But people earnings more than $100,000 may start to reach the limit, according to Sidney B. Rosenberg, associate professor emeritus at the University of North Florida. He assumes a household earns $110,000 and has a $300,000 mortgage on which it pays $17,500 a year. It also pays property taxes and state taxes at estimated nationally average rates. Such a family would have nearly $35,000 of deductible expenses, Dr. Rosenberg calculates.

One argument against curtailing the mortgage deduction is that it could reduce demand for housing, depressing home prices when the housing market is still somewhat weak. The National Association of Realtors believes a removal of the deduction could reduce property values by 15 percent, according to a presentation last year from its chief economist, Lawrence Yun.

Other analysts say they believe the housing industry overstates the potential impact. With several forms of government subsidy also supporting housing, it’s hard to single out the effect of the mortgage deduction. At the most, the Reason Foundation estimates, the deduction may bolster house prices by 3 percent.

Since any deduction cap is likely to aim at higher earners, expensive houses would be most affected. But big-ticket homes appear much more resilient to shocks than lower-cost dwellings.

CoreLogic, a housing data company, tracks data that effectively divides the market into higher- and lower-cost houses, grouping them based on the size of the mortgages. The prices of the higher-cost houses are up 5.9 percent since the start of 2005, before the housing crash. In contrast, the houses at the lower end have fallen 13.5 percent in price since the beginning of 2005.

Given the apparent sturdiness of the higher end of the housing market, politicians may decide there are few risks in effectively capping mortgage deductions for high earners. Limiting tax breaks in a way that could reduce mortgage relief would be a change for Washington, which has done so much to support housing.

Nick Kasprak, an analyst at the Tax Foundation, said that up until recently he didn’t expect to see a cap on deductions. “But now,” he said, “it seems both parties are open to pursuing this strategy.”

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Bangladesh Fire Kills More Than 100 and Injures Many

MUMBAI — More than 100 people died Saturday and Sunday in a fire at a garment factory outside Dhaka, Bangladesh, in one of the worst industrial tragedies in that country.

It took firefighters all night to put out the blaze at the factory, Tazreen Fashions, after it started about 7 p.m. on Saturday, a retired fire official said by telephone from Dhaka, the capital. At least 111 people were killed, and scores of workers were taken to hospitals for treatment of burns and smoke inhalation.

“The main difficulty was to put out the fire; the sufficient approach road was not there,” said the retired official, Salim Nawaj Bhuiyan, who now runs a fire safety company in Dhaka. “The fire service had to take great trouble to approach the factory.”

Bangladesh’s garment industry, the second-largest exporter of clothing after China, has a notoriously poor fire safety record. Since 2006, more than 500 Bangladeshi workers have died in factory fires, according to Clean Clothes Campaign, an antisweatshop advocacy group in Amsterdam. Experts say many of the fires could have been easily avoided if the factories had taken the right precautions. Many factories are in cramped neighborhoods and have too few fire escapes, and they widely flout safety measures. The industry employs more than three million workers in Bangladesh, most of them women.

Activists say that global clothing brands like Tommy Hilfiger and the Gap and those sold by Walmart need to take responsibility for the working conditions in Bangladeshi factories that produce their clothes.

“These brands have known for years that many of the factories they choose to work with are death traps,” Ineke Zeldenrust, the international coordinator for the Clean Clothes Campaign, said in a statement. “Their failure to take action amounts to criminal negligence.”

The fire at the Tazreen factory in Savar, northwest of Dhaka, started in a warehouse on the ground floor that was used to store yarn, and quickly spread to the upper floors. The building was nine stories high, with the top three floors under construction, according to an garment industry official at the scene who asked not to be named because he was not authorized to speak to the news media. Though most workers had left for the day when the fire started, the industry official said as many as 600 workers were still inside working overtime.

The factory, which opened in May 2010, employed about 1,500 workers and had sales of $35 million a year, according to a document on the company’s Web site. It made T-shirts, polo shirts and fleece jackets.

Most of the workers who died were on the first and second floors, fire officials said, and were killed because there were not enough exits. None of them opened to the outside.

“The factory had three staircases, and all of them were down through the ground floor,” said Maj. Mohammad Mahbub, the operations director for the Fire Department, according to The Associated Press. “So the workers could not come out when the fire engulfed the building.”

In a telephone interview later on Sunday, Major Mahbub said the fire could have been caused by an electrical fault or by a spark from a cigarette.

In a brief phone call, Delowar Hossain, the managing director of the Tuba Group, the parent company of Tarzeen Fashions, said he was too busy to comment. “Pray for me,” he said and then hung up.

Television news reports showed badly burned bodies lined up on the floor in what appeared to be a government building. The injured were being treated in hallways of local hospitals, according to the reports.

The industry official said that many of the bodies were burned beyond recognition and that it would take some time to identify them.

One survivor, Mohammad Raju, 22, who worked on the fifth floor, said he escaped by climbing out of a third-floor window onto the bamboo scaffolding that was being used by construction workers. He said he lost his mother, who also worked on the fifth floor, when they were making their way down.

“It was crowded on the stairs as all the workers were trying to come out from the factory,” Mr. Raju said. “There was no power supply; it was dark, and I lost my mother in dark. I tried to search for her for 10 to 15 minutes but did not find her.”

A document posted on Tarzeen Fashions’ Web site indicated that an “ethical sourcing” official for Walmart had flagged “violations and/or conditions which were deemed to be high risk” at the factory in May 2011, though it did not specify the nature of the infractions. The notice said that the factory had been given an “orange” grade and that any factories given three such assessments in two years from their last audit would not receive any Walmart orders for a year.

It was unclear whether Walmart had suspended the company or was still buying clothes from it. The Web sites of Tuba Group lists the retailer and others like Carrefour, a French retail chain, as customers. A spokesman for Walmart, Kevin Gardner, said the company was “so far unable to confirm that Tazreen is supplier to Walmart nor if the document referenced in the article is in fact from Walmart.”

Bangladesh exports about $18 billion worth of garments a year. Employees in the country’s factories are among the lowest-paid in the world, with entry-level workers making a government-mandated minimum wage of about $37 a month.

Tensions have been running high between workers, who have been demanding an increase in minimum wages, and the factory owners and government. A union organizer, Aminul Islam, who campaigned for better working conditions and higher wages, was found tortured and killed outside Dhaka this year.

Fire safety remains weak across much of South Asia. In September, nearly 300 workers were killed in a fire at a textile factory in Karachi, Pakistan, just weeks before it passed an inspection that covered several issues, including health and safety.

Julfikar Ali Manik contributed reporting from Dhaka, Bangladesh, and Stephanie Clifford from New York.

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Legal Consensus of Warrantless Cellphone Searches Is Elusive

Judges and lawmakers across the country are wrangling over whether and when law enforcement authorities can peer into suspects’ cellphones, and the cornucopia of evidence they provide.

A Rhode Island judge threw out cellphone evidence that led to a man being charged with the murder of a 6-year-old boy, saying the police needed a search warrant. A court in Washington compared text messages to voice mail messages that can be overheard by anyone in a room and are therefore not protected by state privacy laws. In Louisiana, a federal appeals court is weighing whether location records stored in smartphones deserve privacy protection, or whether they are “business records” that belong to the phone companies.

“The courts are all over the place,” said Hanni Fakhoury, a criminal lawyer with the Electronic Frontier Foundation, a San Francisco-based civil liberties group. “They can’t even agree if there’s a reasonable expectation of privacy in text messages that would trigger Fourth Amendment protection.”

The issue will attract attention on Thursday when a Senate committee considers limited changes to the Electronic Communications Privacy Act, a 1986 law that regulates how the government can monitor digital communications. Courts have used it to permit warrantless surveillance of certain kinds of cellphone data. A proposed amendment would require the police to obtain a warrant to search e-mail, no matter how old it was, updating a provision that currently allows warrantless searches of e-mails more than 180 days old.

As technology races ahead of the law, courts and lawmakers are still trying to figure out how to think about the often intimate data that cellphones contain, said Peter P. Swire, a law professor at Ohio State University. Neither the 1986 statute nor the Constitution, he said, could have anticipated how much information cellphones are privy to, including detailed records of people’s travels and diagrams of their friends.

“It didn’t take into account what the modern cellphone has — your location, the content of communications that are easily readable, including Facebook posts, chats, texts and all that stuff,” Mr. Swire said.

Courts have also issued divergent rulings on when and how cellphones can be inspected. An Ohio court ruled that the police needed a warrant to search a cellphone because, unlike a piece of paper that might be stuffed inside a suspect’s pocket and can be confiscated during an arrest, a cellphone may hold “large amounts of private data.”

But California’s highest court said the police could look through a cellphone without a warrant so long as the phone was with the suspect at the time of arrest.

Judges across the country have written tomes about whether a cellphone is akin to a “container” — like a suitcase stuffed with marijuana that the police might find in the trunk of a car — or whether, as the judge in the Rhode Island murder case suggested, it is more comparable to a face-to-face conversation. That judge, Judith C. Savage, described text messages as “raw, unvarnished and immediate, revealing the most intimate of thoughts and emotions.” That is why, she said, citizens can reasonably expect them to be private.

There is little disagreement about the value of cellphone data to the police. In response to a Congressional inquiry, cellphone carriers said they responded in 2011 to 1.3 million demands from law enforcement agencies for text messages and other information about subscribers.

Among the most precious information in criminal inquiries is the location of suspects, and when it comes to location records captured by smartphones, court rulings have also been inconsistent. Privacy advocates say a trail of where people go is inherently private, while law enforcement authorities say that consumers have no privacy claim over signals transmitted from an individual mobile device to a phone company’s communications tower, which they refer to as third-party data.

Delaware, Maryland and Oklahoma have proposed legislation that would require the police to obtain a warrant before demanding location records from cellphone carriers. California passed such a law in August after intense lobbying by privacy advocates, including Mr. Fakhoury’s group. But Gov. Jerry Brown, a Democrat, vetoed the bill, questioning whether it struck “the right balance between the operational needs of law enforcement and individual expectations of privacy.”

Similar legislation has been proposed in Congress.

Lacking a clear federal statute, the courts have been unable to reach a consensus. In Texas, a federal appeals court said this year that law enforcement officials did not need a warrant to track suspects through cellphones. In Louisiana, another federal appeals court is considering a similar case. Prosecutors are arguing that location information is part of cellphone carriers’ business records and thus not constitutionally protected.

The Supreme Court has not directly tackled the issue, except to declare, in a landmark ruling this year, that the police must obtain a search warrant to install a GPS tracking device on someone’s private property.

Read More..

M.I.T. Lab Hatches Ideas, and Companies, by the Dozens

HOW do you take particles in a test tube, or components in a tiny chip, and turn them into a $100 million company?

Dr. Robert Langer, 64, knows how. Since the 1980s, his Langer Lab at the Massachusetts Institute of Technology has spun out companies whose products treat cancer, diabetes, heart disease and schizophrenia, among other diseases, and even thicken hair.

The Langer Lab is on the front lines of turning discoveries made in the lab into a range of drugs and drug delivery systems. Without this kind of technology transfer, the thinking goes, scientific discoveries might well sit on the shelf, stifling innovation.

A chemical engineer by training, Dr. Langer has helped start 25 companies and has 811 patents, issued or pending, to his name. That’s not too far behind Thomas Edison, who had 1,093. More than 250 companies have licensed or sublicensed Langer Lab patents.

Polaris Venture Partners, a Boston venture capital firm, has invested $220 million in 18 Langer Lab-inspired businesses. Combined, these businesses have improved the health of many millions of people, says Terry McGuire, co-founder of Polaris.

Along the way, Dr. Langer and his lab, including about 60 postdoctoral and graduate students at a time, have found a way to navigate some slippery territory: the intersection of academic research and the commercial market.

Over the last 30 years, many universities — including M.I.T. — have set up licensing offices that oversee the transfer of scientific discoveries to companies. These offices have become a major pathway for universities seeking to put their research to practical use, not to mention add to their revenue streams.

In the sciences in particular, technology transfer has become a key way to bring drugs and other treatments to market. “The model of biomedical innovation relies on research coming out of universities, often funded by public money,” says Josephine Johnston, director of research at the Hastings Center, a bioethics research organization based in Garrison, N.Y.

Just a few of the products that have emerged from the Langer Lab are a small wafer that delivers a dose of chemotherapy used to treat brain cancer; sugar-sequencing tools that can be used to create new drugs like safer and more effective blood thinners; and a miniaturized chip (a form of nanotechnology) that can test for diseases.

The chemotherapy wafer, called the Gliadel, is licensed by Eisai Inc. The company behind the sugar-sequencing tools, Momenta Pharmaceuticals, raised $28.4 million in an initial public offering in 2004. The miniaturized chip is made by T2Biosystems,  which completed a $23 million round of financing in the summer of 2011.

“It’s inconvenient to have to send things to a lab,” so the company is trying to develop more sophisticated methods, says Dr. Ralph Weissleder, a co-founder, with Dr. Langer and others, of T2Biosystems and a professor at Harvard Medical School.

FOR Dr. Langer, starting a company is not the same as it was, say, for Mark Zuckerberg with Facebook. “Bob is not consumed with any one company,” says H. Kent Bowen, an emeritus professor of business administration at Harvard Business School who wrote a case study on the Langer Lab. “His mission is to create the idea.”

Dr. Bowen observes that there are many other academic laboratories, including highly productive ones, but that the Langer Lab’s combination of people, spun-out companies and publications sets it apart. He says Dr. Langer “walks into the great unknown and then makes these discoveries.”

Dr. Langer is well known for his mentoring abilities. He is “notorious for replying to e-mail in two minutes, whether it’s a lowly graduate school student or the president of the United States,” says Paulina Hill, who worked in his lab from 2009 to 2011 and is now a senior associate at Polaris Venture Partners. (According to Dr. Langer, he has corresponded directly with President Obama about stem cell research and federal funds for the sciences.)

Dr. Langer says he looks at his students “as an extended family,” adding that “I really want them to do well.”

And they have, whether in business or in academia, or a combination of the two. One former student, Ram Sasisekharan, helped found Momenta and now runs his own lab at M.I.T. Ganesh Venkataraman Kaundinya is Momenta’s chief scientific officer and senior vice president for research.

Hongming Chen is vice president of research at Kala Pharmaceuticals. Howard Bernstein is chief scientific officer at Seventh Sense Biosystems, a blood-testing company. Still others have taken jobs in the law or in government.

Dr. Langer says he spends about eight hours a week working on companies that come out of his lab. Of the 25 that he helped start, he serves on the boards of 12 and is an informal adviser to 4. All of his entrepreneurial activity, which includes some equity stakes, has made him a millionaire. But he says he is mainly motivated by a desire to improve people’s health.

Operating from the sixth floor of the David H. Koch Institute for Integrative Cancer Research on the M.I.T. campus in Cambridge, Mass., Dr. Langer’s lab has a research budget of more than $10 million for 2012, coming mostly from federal sources.

The research in labs like Dr. Langer’s is eyed closely by pharmaceutical companies. While drug companies employ huge research and development teams, they may not be as freewheeling and nimble, Dr. Langer says. The basis for many long-range discoveries has “come out of academia, including gene therapy, gene sequencing and tissue engineering,” he says.

He has served as a consultant to pharmaceutical companies. Their large size, he says, can end up being an impediment.

“Very often when you are going for real innovation,” he says, “you have to go against prevailing wisdom, and it’s hard to go against prevailing wisdom when there are people who have been there for a long time and you have some vice president who says, ‘No, that doesn’t make sense.’ ”

Pharmaceutical companies are eager to tap into the talent at leading research universities. In 2008, for example, Washington University in St. Louis announced a $25 million pact with Pfizer to collaborate more closely on biomedical research.

But in some situations, the close — critics might say cozy — ties between business and academia have the potential to create conflicts of interest.

There was a controversy earlier this year when it was revealed that the president of the University of Texas M.D. Anderson Cancer Center owned stock in Aveo Oncology, which had announced earlier that the university would be leading clinical trials of one of its cancer drugs.  Last month, the University of Texas announced that he would be allowed to keep his ties with three pharmaceutical companies, including Aveo Oncology; his holdings will be placed in a blind trust.

Read More..

M.I.T. Lab Hatches Ideas, and Companies, by the Dozens

HOW do you take particles in a test tube, or components in a tiny chip, and turn them into a $100 million company?

Dr. Robert Langer, 64, knows how. Since the 1980s, his Langer Lab at the Massachusetts Institute of Technology has spun out companies whose products treat cancer, diabetes, heart disease and schizophrenia, among other diseases, and even thicken hair.

The Langer Lab is on the front lines of turning discoveries made in the lab into a range of drugs and drug delivery systems. Without this kind of technology transfer, the thinking goes, scientific discoveries might well sit on the shelf, stifling innovation.

A chemical engineer by training, Dr. Langer has helped start 25 companies and has 811 patents, issued or pending, to his name. That’s not too far behind Thomas Edison, who had 1,093. More than 250 companies have licensed or sublicensed Langer Lab patents.

Polaris Venture Partners, a Boston venture capital firm, has invested $220 million in 18 Langer Lab-inspired businesses. Combined, these businesses have improved the health of many millions of people, says Terry McGuire, co-founder of Polaris.

Along the way, Dr. Langer and his lab, including about 60 postdoctoral and graduate students at a time, have found a way to navigate some slippery territory: the intersection of academic research and the commercial market.

Over the last 30 years, many universities — including M.I.T. — have set up licensing offices that oversee the transfer of scientific discoveries to companies. These offices have become a major pathway for universities seeking to put their research to practical use, not to mention add to their revenue streams.

In the sciences in particular, technology transfer has become a key way to bring drugs and other treatments to market. “The model of biomedical innovation relies on research coming out of universities, often funded by public money,” says Josephine Johnston, director of research at the Hastings Center, a bioethics research organization based in Garrison, N.Y.

Just a few of the products that have emerged from the Langer Lab are a small wafer that delivers a dose of chemotherapy used to treat brain cancer; sugar-sequencing tools that can be used to create new drugs like safer and more effective blood thinners; and a miniaturized chip (a form of nanotechnology) that can test for diseases.

The chemotherapy wafer, called the Gliadel, is licensed by Eisai Inc. The company behind the sugar-sequencing tools, Momenta Pharmaceuticals, raised $28.4 million in an initial public offering in 2004. The miniaturized chip is made by T2Biosystems,  which completed a $23 million round of financing in the summer of 2011.

“It’s inconvenient to have to send things to a lab,” so the company is trying to develop more sophisticated methods, says Dr. Ralph Weissleder, a co-founder, with Dr. Langer and others, of T2Biosystems and a professor at Harvard Medical School.

FOR Dr. Langer, starting a company is not the same as it was, say, for Mark Zuckerberg with Facebook. “Bob is not consumed with any one company,” says H. Kent Bowen, an emeritus professor of business administration at Harvard Business School who wrote a case study on the Langer Lab. “His mission is to create the idea.”

Dr. Bowen observes that there are many other academic laboratories, including highly productive ones, but that the Langer Lab’s combination of people, spun-out companies and publications sets it apart. He says Dr. Langer “walks into the great unknown and then makes these discoveries.”

Dr. Langer is well known for his mentoring abilities. He is “notorious for replying to e-mail in two minutes, whether it’s a lowly graduate school student or the president of the United States,” says Paulina Hill, who worked in his lab from 2009 to 2011 and is now a senior associate at Polaris Venture Partners. (According to Dr. Langer, he has corresponded directly with President Obama about stem cell research and federal funds for the sciences.)

Dr. Langer says he looks at his students “as an extended family,” adding that “I really want them to do well.”

And they have, whether in business or in academia, or a combination of the two. One former student, Ram Sasisekharan, helped found Momenta and now runs his own lab at M.I.T. Ganesh Venkataraman Kaundinya is Momenta’s chief scientific officer and senior vice president for research.

Hongming Chen is vice president of research at Kala Pharmaceuticals. Howard Bernstein is chief scientific officer at Seventh Sense Biosystems, a blood-testing company. Still others have taken jobs in the law or in government.

Dr. Langer says he spends about eight hours a week working on companies that come out of his lab. Of the 25 that he helped start, he serves on the boards of 12 and is an informal adviser to 4. All of his entrepreneurial activity, which includes some equity stakes, has made him a millionaire. But he says he is mainly motivated by a desire to improve people’s health.

Operating from the sixth floor of the David H. Koch Institute for Integrative Cancer Research on the M.I.T. campus in Cambridge, Mass., Dr. Langer’s lab has a research budget of more than $10 million for 2012, coming mostly from federal sources.

The research in labs like Dr. Langer’s is eyed closely by pharmaceutical companies. While drug companies employ huge research and development teams, they may not be as freewheeling and nimble, Dr. Langer says. The basis for many long-range discoveries has “come out of academia, including gene therapy, gene sequencing and tissue engineering,” he says.

He has served as a consultant to pharmaceutical companies. Their large size, he says, can end up being an impediment.

“Very often when you are going for real innovation,” he says, “you have to go against prevailing wisdom, and it’s hard to go against prevailing wisdom when there are people who have been there for a long time and you have some vice president who says, ‘No, that doesn’t make sense.’ ”

Pharmaceutical companies are eager to tap into the talent at leading research universities. In 2008, for example, Washington University in St. Louis announced a $25 million pact with Pfizer to collaborate more closely on biomedical research.

But in some situations, the close — critics might say cozy — ties between business and academia have the potential to create conflicts of interest.

There was a controversy earlier this year when it was revealed that the president of the University of Texas M.D. Anderson Cancer Center owned stock in Aveo Oncology, which had announced earlier that the university would be leading clinical trials of one of its cancer drugs.  Last month, the University of Texas announced that he would be allowed to keep his ties with three pharmaceutical companies, including Aveo Oncology; his holdings will be placed in a blind trust.

Read More..

M.I.T. Lab Hatches Ideas, and Companies, by the Dozens

HOW do you take particles in a test tube, or components in a tiny chip, and turn them into a $100 million company?

Dr. Robert Langer, 64, knows how. Since the 1980s, his Langer Lab at the Massachusetts Institute of Technology has spun out companies whose products treat cancer, diabetes, heart disease and schizophrenia, among other diseases, and even thicken hair.

The Langer Lab is on the front lines of turning discoveries made in the lab into a range of drugs and drug delivery systems. Without this kind of technology transfer, the thinking goes, scientific discoveries might well sit on the shelf, stifling innovation.

A chemical engineer by training, Dr. Langer has helped start 25 companies and has 811 patents, issued or pending, to his name. That’s not too far behind Thomas Edison, who had 1,093. More than 250 companies have licensed or sublicensed Langer Lab patents.

Polaris Venture Partners, a Boston venture capital firm, has invested $220 million in 18 Langer Lab-inspired businesses. Combined, these businesses have improved the health of many millions of people, says Terry McGuire, co-founder of Polaris.

Along the way, Dr. Langer and his lab, including about 60 postdoctoral and graduate students at a time, have found a way to navigate some slippery territory: the intersection of academic research and the commercial market.

Over the last 30 years, many universities — including M.I.T. — have set up licensing offices that oversee the transfer of scientific discoveries to companies. These offices have become a major pathway for universities seeking to put their research to practical use, not to mention add to their revenue streams.

In the sciences in particular, technology transfer has become a key way to bring drugs and other treatments to market. “The model of biomedical innovation relies on research coming out of universities, often funded by public money,” says Josephine Johnston, director of research at the Hastings Center, a bioethics research organization based in Garrison, N.Y.

Just a few of the products that have emerged from the Langer Lab are a small wafer that delivers a dose of chemotherapy used to treat brain cancer; sugar-sequencing tools that can be used to create new drugs like safer and more effective blood thinners; and a miniaturized chip (a form of nanotechnology) that can test for diseases.

The chemotherapy wafer, called the Gliadel, is licensed by Eisai Inc. The company behind the sugar-sequencing tools, Momenta Pharmaceuticals, raised $28.4 million in an initial public offering in 2004. The miniaturized chip is made by T2Biosystems,  which completed a $23 million round of financing in the summer of 2011.

“It’s inconvenient to have to send things to a lab,” so the company is trying to develop more sophisticated methods, says Dr. Ralph Weissleder, a co-founder, with Dr. Langer and others, of T2Biosystems and a professor at Harvard Medical School.

FOR Dr. Langer, starting a company is not the same as it was, say, for Mark Zuckerberg with Facebook. “Bob is not consumed with any one company,” says H. Kent Bowen, an emeritus professor of business administration at Harvard Business School who wrote a case study on the Langer Lab. “His mission is to create the idea.”

Dr. Bowen observes that there are many other academic laboratories, including highly productive ones, but that the Langer Lab’s combination of people, spun-out companies and publications sets it apart. He says Dr. Langer “walks into the great unknown and then makes these discoveries.”

Dr. Langer is well known for his mentoring abilities. He is “notorious for replying to e-mail in two minutes, whether it’s a lowly graduate school student or the president of the United States,” says Paulina Hill, who worked in his lab from 2009 to 2011 and is now a senior associate at Polaris Venture Partners. (According to Dr. Langer, he has corresponded directly with President Obama about stem cell research and federal funds for the sciences.)

Dr. Langer says he looks at his students “as an extended family,” adding that “I really want them to do well.”

And they have, whether in business or in academia, or a combination of the two. One former student, Ram Sasisekharan, helped found Momenta and now runs his own lab at M.I.T. Ganesh Venkataraman Kaundinya is Momenta’s chief scientific officer and senior vice president for research.

Hongming Chen is vice president of research at Kala Pharmaceuticals. Howard Bernstein is chief scientific officer at Seventh Sense Biosystems, a blood-testing company. Still others have taken jobs in the law or in government.

Dr. Langer says he spends about eight hours a week working on companies that come out of his lab. Of the 25 that he helped start, he serves on the boards of 12 and is an informal adviser to 4. All of his entrepreneurial activity, which includes some equity stakes, has made him a millionaire. But he says he is mainly motivated by a desire to improve people’s health.

Operating from the sixth floor of the David H. Koch Institute for Integrative Cancer Research on the M.I.T. campus in Cambridge, Mass., Dr. Langer’s lab has a research budget of more than $10 million for 2012, coming mostly from federal sources.

The research in labs like Dr. Langer’s is eyed closely by pharmaceutical companies. While drug companies employ huge research and development teams, they may not be as freewheeling and nimble, Dr. Langer says. The basis for many long-range discoveries has “come out of academia, including gene therapy, gene sequencing and tissue engineering,” he says.

He has served as a consultant to pharmaceutical companies. Their large size, he says, can end up being an impediment.

“Very often when you are going for real innovation,” he says, “you have to go against prevailing wisdom, and it’s hard to go against prevailing wisdom when there are people who have been there for a long time and you have some vice president who says, ‘No, that doesn’t make sense.’ ”

Pharmaceutical companies are eager to tap into the talent at leading research universities. In 2008, for example, Washington University in St. Louis announced a $25 million pact with Pfizer to collaborate more closely on biomedical research.

But in some situations, the close — critics might say cozy — ties between business and academia have the potential to create conflicts of interest.

There was a controversy earlier this year when it was revealed that the president of the University of Texas M.D. Anderson Cancer Center owned stock in Aveo Oncology, which had announced earlier that the university would be leading clinical trials of one of its cancer drugs.  Last month, the University of Texas announced that he would be allowed to keep his ties with three pharmaceutical companies, including Aveo Oncology; his holdings will be placed in a blind trust.

Read More..