The rush to market gene-engineering techniques is forcing university professors to try to serve two masters--industry and academe--at the risk of conflicts of interest, according to speakers at two separate meetings on the subject this month.

At a meeting in Boston, Harvard President Derek Bok outlined a list of possible rules to govern deals between universities and industry, and a few days later, several witnesses at a congressional hearing agreed that Bok's list would be a good starting point for dealing with conflict of interest.

The congressional hearing, before the House Oversight and Investigations subcommittee, focused on two controversial cases in the field: an incident in which a professor at the University of California at Davis was forced off a project after charges of conflict of interest, and a $23.5 million deal between Monsanto Co. and Washington University in St. Louis.

In the past five years, more than 100 companies have been started to exploit the new knowledge coming from the booming field of molecular biology. At the same time, the most conservative estimate has counted the special arrangements between corporations and universities at more than $200 million.

In a time when federal budgets are shrinking, universities need the money they can glean from the promise of biotechnology products. The corporations, for their part, are seeking special access to the nation's best minds in biological research and exclusive licenses to exploit their research if it leads to marketable products.

Some fear that professors will direct their efforts toward commercially useful work at the expense of basic research and also become more secretive about their work to protect its commercial value--in essence, switching allegiance from pure to commercial biology.

"The major problem in the current situation is that of faculty trying to serve, and have a financial interest in, both the university and the private sector at the same time," Dean Charles Hess of the College of Agriculture at the University of California at Davis told the House subcommittee.

"In some cases," Hess said, "the dual relationship may be beneficial to all parties involved. In most cases it will cause a potential conflict of interest that is not acceptable."

At Davis, Professor Ray Valentine was working on plants that might be made to get nitrogen from the air, in effect, fertilizing themselves. He started a company called Calgene, and at the same time, the university sought industry funds to back the work.

When the school got a $2.5 million grant from Allied Chemical Co., Valentine was to be a primary researcher under the Allied grant. Further, it was reported that Allied had bought 20 percent of Valentine's company.

Hess feared that "the public perception of, or the potential for, a conflict of interest was so great that action by my office was required." Eventually, Valentine was forced out of the Allied-financed work at Davis.

Hess has one of the toughest standards of conflict of interest in the nation, requiring all faculty at his school to file reports whenever they do work outside the university. Under the system, in about "five or six" cases he has stopped faculty members from doing outside work.

In the new agreement between Monsanto and Washington University the university will receive $23.5 million over five years to finance biotechnology projects.

Rep. Albert Gore (D-Tenn.), noting that the agreement will require scientists not to divulge some details of their work under the project without Monsanto's approval, complained, "This allows the company to put guidelines on as to what it's all right for university researchers to speak about in an academic forum."

Howard Schneiderman, vice president of research and development for Monsanto, said that confidentiality was necessary to protect Monsanto's ability to get some patents. Merely speaking in public about a research advance can prevent a scientist from getting a patent in some countries.

At the biotechnology meeting in Boston, Bok of Harvard listed rules that universities might be willing to adopt in their dealings with corporations. "There is no doubt about the key question," said Bok. "Where do the primary loyalties of the professor lie?"

Among Bok's proposed rules are the following:

* Denying exclusive licenses to firms in which university people have a significant interest.

* Prohibiting the most extreme cases of multiple links between a professor and a company, including holding stock in a company, being a consultant for it, and at the same time getting a grant from it.

* Forbidding professors from holding substantial stock, perhaps 10 percent or more, in any company that might benefit from their work.

Witnesses from Monsanto and other companies involved in biotechnology, as well as Dean Hess and other university witnesses, agreed that these might be minimum standards for universities. They added that current rules vary greatly from school to school and often are not written.