Medical Research Scotland (MRS) is putting private firms at the centre of its new funding structure by inviting businesses to bid for money. The system will replace the old-style project grants that were made for specific PhD proposals by universities.
Biotechnology companies will find academic partners and then pitch for cash from MRS to fund specific projects, meaning that funding will be driven by demand from the market rather than university priorities.
The charity expects to fund about four PhD students working at companies each year, along with 40 summer projects for undergraduates working with private firms.
Professor David Harrison, chairman of MRS, who began his own career with an award from the charity, said: "Consortia will submit project proposals, which will be reviewed in the early autumn by a panel of academic and industrial experts chaired by Professor Walter Nimmo, a successful and still very active academic entrepreneur who founded and led Inveresk Research.
"These new PhD awards will involve close working between universities and life science companies and will also incorporate additional training on how to develop science careers in an increasingly competitive and exciting market."
Scott Johnstone, chief executive of trade body Scottish Lifesciences Association, added: "This is the first time industry can drive the research and have ownership for the resulting commercialisation of the work.
"As an industry we have been calling for this type of initiative for some time now and it is thanks to the ingenuity of a leading charity that this has been delivered."
MRS was launched by the UK government in 1953 as the Scottish Hospitals Endowments Research Trust and was spun off as a separate charity in 2005.