I N N O V A T I O N L A W

PHILIP MENDES & BRADLEY THOMAS

Level 3, 380 Queen StBrisbane QLD, Australia

Ph + 61 7 3211 9033Fax + 61 7 3211 9025

Philip@innovationlaw.com.auBradley@innovationlaw.com.au

Topic 9Establishing a Marketing Plan for Technology

Commercialisation

Marketing Strategies

What is a marketing strategy ? A plan for getting your technology commercialised

Commercialisation does not just happen No one beats a path to your door competing for a license to your patent

Commercialisation comes about because a strategy is implemented to Find licensing opportunities Find potential licensing partners

Following slides are observations about what might be considered for a commercialisation marketing strategy

That is, ways to help find a licensee for your technology

Deals are made between people who know each other

Cold calling potential licensees rarely works

Most deals done for research organisations are made between parties who already have a connection

That existing connection facilitates the deal opportunity enthusiasm for the deal – to progress the path to doing the deal the making of the deal

There are lots of exciting technologies People who deal with others that they already know is an edge that

differentiates the exciting technology with no deal the exciting technology with a deal

Strategies to get to know people with whom you might do a deal

Intimacy in the industry

A business development manager that has networks in the industry can find deal opportunities

Deal opportunities present themselves because A BDM knows that Company X has a need for certain technology Company X’s needs may not be generally known Company X’s needs may be identified because of synergy between

the field it is in, and the area of research that the research organisation is in

Strategies to get to know people with whom you might do a deal

BDMs need to Network within their industry Attend conferences, exhibitions, functions

Inadequate to do it once Needs to be a constant never ending networking strategy:

to go to events, to see, and to be seen, to get to know the people in the industry

The longer that strategy is implemented, the more successful it will be The success of the strategy is limited only by

Financial resources to travel The degree of intimacy established in networking

ITL Xe - toxins

Strategies to get to know people with whom you might do a deal

Scientists also play a critical role in this networking Scientists should regularly go to the conferences in their field Conferences are attended by business development staff of biotech

and pharmaceutical companies Staff of biotech and pharmaceutical companies attend conferences to

see what new science is emerging Opportunities for scientists to establish rapport and relationships

with business development staff from staff of biotech and pharmaceutical companies

Again, must be constant strategy, inadequate to do it once

HPV

This strategy is not devious, nor need it be selfishly pursued If its totally selfishly motivated, with a “hard sell” networking is unlikely to work, excellent friendships and personal relationships

BDMs actively attend conferences and exhibitions, those that are identified as providing opportunities to build networks that are

identified as potentially valuable Do not expect overnight results Results may take a few years to pay off

Scientists Actively attend those conferences where relationships can be nurtured and rapport

built

Marketing plan strategy

Make this a strategy in a marketing plan Do not make it something that is casually applied, with unpredictable hit or

miss results

Systematic: Identify conferences and exhibitions Identify who should go to obtain maximum advantage Consistency go each year to renew, and reinforce relationships Ensure adequate financial resources to implement this expensive

commitment

Marketing plan strategy

Identifying potential licensees – identify people you already know

When something is ready for a deal, ask “Who do we know that may be interested in this”

More likely to do a deal with someone that you already know, rather than someone that you don’t know yet

What existing relationships might suggest that someone you already know may be interested What companies have existing deals been with ? What people met at conferences and exhibitions may be interested Former PhD students in industry Former colleagues in industry Who in your network that you already know may be interested

Omega 3

People you know that can open doors

Asks these questions in a wider framework Not just who do you know that may be interested in a deal

More important: Who do you know that can open the door and introduce you to someone

that may be interested in doing a deal That represents an even wider network of potential parties with whom the

opportunity for a deal may arise

Even more important Ask the person you know if they know someone else who can open the

door for you That represents an even wider network

When a commercialisation candidate is identified: Systematically

Identify everyone concerned with the technology (scientists and BDMs) Enquire whether anyone knows someone Who may be interested in the technology themselves Who may know someone who may be interested in the technology and

may be able to open door Who may know another person who can open doors

Again, Systematic Not casual

Marketing plan strategy

Publications as a marketing strategy

Publications and commercialisation sometimes perceived as being on a collision course Publication means disseminating, and disseminating adversely affects novelty Commercialisation perceived as needing secrecy, and that is not consistent with

the publication objective.

But that is too simple a view Scientists and BDMs are now much more sophisticated

BDMs know that publications and peer recognition are an important driver for innovation and inventiveness, and personal satisfaction of scientists

Scientists know that publication can potentially destroy the transformation of the outcomes of their research into useful and beneficial products for the community

Publications as a marketing strategy

Both scientists and BMS therefore know that they each have to help the other achieve the objectives of both

That is Both publish and commercialise

Publication part of a broader commercialisation strategy Publication at the right time, in the right forum, creates deal opportunities As a marketing tool marketing opportunity

Conference presentations identify emerging technologies of interest to potential industry partners

Many deals are done because of deal opportunities presented by opportune publications

HPV

Give consideration to the optimal Manner of publication Place of publication

What is the best audience for the publication Is one publication option better than another

Marketing Plan might consider systematic Identification of publications Identification of optimal means of dissemination Processes to accelerate or delay publication for maximum advantage Achieving publications as a marketing tool and opportunity

Marketing plan strategy

The role of the scientist in finding leads

Much folklore about the leads for licensing originating with scientists Folklore confirmed

“Where do the Leads for Licenses Come From” Journal of the Association of University Technology Managers

Volume XI (1999) http://www.autm.net/pubs/journal/99/leads.cfm

Study of 1140 licenses Granted by 6 institutions: University of Florida, MIT, Oak Ridge

National Laboratory, Oregon Health Sciences University, Tulane University, University of Utah

These institutions vary in size, and vary in specialisation

The role of the scientist in finding leads

Sources of Leads for Licenses

0

10

20

30

40

50

60

Scientist Marketing Company approach Research sponsor

Leads by scientist: 56% (range 45-67)

Leads by marketing efforts from licensing staff: 19% (range 12-42)

Leads by enquiry from potential licensee: 10% (range 0-17)

Leads from research sponsor: 7% (range 0- 25)

The role of the scientist in finding leads

Scientists need to be asked who they know that may be interested in their invention

Invention Disclosure Form Used by research organisation as a means of

Helping scientists identify their invention Assisting scientists to disclose their invention First step in the commercialisation assessment, and patenting evaluation

process Inventor Disclosure form should include provision for scientist to identify

Industry applications Potential licensees that may be interested Persons the scientists knows personally, or knows of, that may be

interested

The role of the scientist in finding leads

Why do scientists produce the greatest number of leads ? They have good industry contacts and large personal networks Long history of association with industry Sponsored research relationships with industry Consulting engagements by industry Networks amongst their former students Companies want to deal with scientists that are leaders in their field,

particularly scientists where that leadership is demonstrated through publications

Need to engage scientists not just once, but continually When Inventor Disclosure Form signed When patent search is done When patent application is filed

Encourage scientists: to form, expand and maintain their networks and contacts to maintain a high profile to undertaking private consulting to attend conferences to publish to get the business cards of people that they meet

Enquire of scientists systematically about potential licensees that they can identify Not just once Repeatedly

Marketing plan strategy

Consider deals other than licensing, as marketing opportunities for licensing

Sometimes a marketing strategy for licensing is to do a deal other than a licensing deal

Strategic Alliance with another research organisation

If another research organisation has the networks to make a deal there are synergies between your own technology

consider partnering with that other research organisation, making your technology available to them, and allow them to access their networks and contacts – the people that they know, to commercialise the package of your technology and theirs

VIDRL

Consider deals other than licensing, as marketing opportunities for licensing

Strategic Alliances with industry partners

You don’t need to wait to have your technology ready for a deal A technology in a stage of development may be appealing to an industry strategic

alliance partner There may be

complementary research capabilities potential synergies in the research programs of the research organisation and the

potential alliance partner

The deal becomes not just a license The deal instead becomes one with many features

Collaborative research, scientists from both organisations working together Financing and sponsorship for research Skills acquisition And a license as well

Marketing plan strategy

Marketing plan should identify potential strategic alliance partners Both other research organisations, and industry partners

What organisations are there with synergistic research programs ? What companies are there with synergistic research programs ?

What relationships already exist to tap into those opportunities ? How can they be accessed ?

Constantly identify and assess new potential strategic alliance partners with whom there may be synergies

Research sponsorship

Research sponsorship is the financial sponsorship of research by industry at a research organisation

Sponsored research tends to be applied research

Sponsored research is not necessarily contract research where the provider of funds owns the IP outcomes Sponsored research usually means there is a cost sharing: Research organisation may do research for direct costs (salary and

consumables), leveraging off their infrastructure, foregoing seeking costs for infrastructure, and foregoing a profit component)

On that basis, research organisation owns the IP outcomes, and licenses outcomes to research sponsor

Reward for providing infrastructure at zero cost, and foregoing profit component is the expectation of royalties

Research sponsorship

Research sponsorship accounting for an average of only 7% of licensing leads in AUTM survey

But one respondent to the survey reported as many as 25% leads

Research sponsorship is therefore an important marketing strategy

By making the skills and resources of the research organisation available to industry sponsors: Direct licensing opportunities arise (up to 25%, average of 7%) Relationships are formed between scientists and industry, and those

relationships indirectly lead to more opportunities (average 56%)

Research sponsorship

Challenge is to increase the level of research sponsorship

Interact with industry to Identify their needs for applied research Identify your own synergistic research capability

Resist demands for the research sponsor to own the IP created in the course of the sponsored research Industry sponsor can own if it pays a market rate that takes into account

indirect infrastructure costs (buildings, roads, labs, equipment, facilities, library etc), and pays a profit component

Industry sponsor cannot own if it pays less than that – in that case the research sponsor should own, and license out

Seek out relationships with industry that can sponsor applied research Identify who they are Identify their needs Implement the strategy by forging networks and relationships with them

Not likely to be an overnight response Expertise, capability, resources, and willingness to undertake applied

research takes time to filter out to potential partners

Perseverance pays off

Marketing plan strategy

Know your industry space

Industry Watch Patent Watch Literature Watch Newsletter Watch Press Release Watch

All of these are means by which you can keep up with what is happening in the industry relevant to your science Knowing what is going on in your industry space will help identify Potential licensees who may be interested in your technology Potential strategic alliance partners Potential infringers

Know your industry space

Patent Watch and Literature watch

Keep an eye on new patents that are published Keep an eye on scientific literature to see what science others are up to Do they overlap with yours ?

Would the exploitation of their patent necessarily infringe yours ? Is their invention synergistic with your own invention ? Might they be interested in

A license A strategic alliance

Do they infringe your patent so that they have to get a license from you ?

Know your industry space

Newsletter Watch and Press Release Watch

Specialists newsletters published regularly on industry news informing the industry about new science, new deals, etc RNAI news, Genome Web daily news BioArray News, Cell Based Assay News

News services Daily email with links to press releases issued in last 24 hours containing

your key words

All are means to keeping informed about what is going on Identify

Potential licensees Potential strategic alliance partners Potential infringers Ozgene

Know your industry space

Industry Watch

Be aware of new products and inventions that enter the market place in your space

Identify Potential licensees Potential research collaborators Potential strategic alliance partners Potential infringers

GE

Marketing plan should: Identify what to watch

Industry watch Patent Watch Literature Watch Press Release Watch Newsletter Watch

Who will have responsibility for watching Process of assessment and review of intelligence gathered Process of planning to maximise taking advantage of intelligence

learned

Marketing plan strategy

Infringers are potential licensees

An infringer should not necessarily be perceived as a wrong doer Every infringer is a potential

Licensee, or Strategic alliance partner and licensee

Not every infringer knows that they are infringing The rate of change of science, particularly in biotechnology, is such that

exactly the same invention may be made by different people, in close proximity in time

Very possible that an infringer may not know that they are infringing your patent

Infringers are the easiest target to take a license from you

Infringers are potential licensees

Challenge is to identify infringers Industry Watch Patent Watch Literature Watch Press Release Watch Newsletter Watch

Once you find an infringer, you have to do something about it

Groundless threats of litigation can lead to an exposure to the patent owner that makes the groundless threat

Need to be sure that your patent is valid Prudent to make no threat, but to make an infringer aware of your patent and invite a

discussion about respective patent positions That starts a dialogue on whether there is an infringement, and if so, the availability of

a license

Infringers are potential licensees

Myths: That infringers are never pursued That it is not worthwhile to pursue an infringer That pursuing an infringer leads to the patent being challenged

All that does happen from time to time

But in the vast majority of cases a robust patent position makes it unnecessary to have to consider infringement

An infringer is not necessarily someone against whom you litigate An infringer may be someone who becomes your most valuable strategic

alliance partner

Use Industry Watch Patent Watch Literature Watch Press Release Watch Newsletter Watchto identify infringer

Marketing Plan may make provision for Keeping watch on potential infringers Strategy to implement when an infringer is identified

Formal approach by letter Informal approach engineered at a conference And must consider litigation as a last resort, but not exclude it

altogether

Marketing plan strategy

Appoint Marketers

A Marketer is someone that goes out and markets your technology and finds licensees on a contract basis

Usually for a percentage of royalties and other licensing fees Marketer is someone that you appoint because of

their networks and contacts, licensing opportunities that they can find for you

That is, if you don’t know someone with whom to do a deal with, find someone who does

Appointment of a Marketer often approached with hesitation Many people offerring services as marketers in fact do not have the networks

and contacts that they say that they do But don’t be deterred Many successful deals have been facilitated by contract marketers Ex-pharma executives

Marketing Plan might make provision for the appointment of a marketer Identify Marketers

Identify their areas of expertise Undertake a due diligence on the Marketer Who have they worked for What networks and contacts would you expect them to have What deals have they successfully facilitated

Identify your technologies that may benefit from the appointment of a Marketer

Engage not on retainer, but on success only

Marketing plan strategy

Direct approach – Evaluation Package

A package that is sent out to multiple potential licensees Package may contain:

One pager non confidential description of the technology Data sheet to substantiate claims Link to published patent (or copy) Link to published literature (or copy) Template Confidentiality Agreement or Material Transfer Agreement Letter inviting an interested recipient to evaluate the technology

Identify all possible potential licensees that may be interested Identify key person in each organisation to approach Send the evaluation package Follow up with each recipient to whom it was sent

Direct Approach - Roadshows

A roadshow is a personal presentation to potential licensees

Identify licensees Confirm their interest Don’t wait for the phone call asking for a license

Be proactive Get on a plane and go and see all of them Arrange appointments with all of them and do a roadshow trip to the US

and/or Europe to make presentations Personal presentations can quickly screen uninterested potential licensees

from real candidates Interaction efficiently progresses the discussion and assessment of the science Starts the important relationship building exercise that is an important part of

every deal

Consider Evaluation Package being sent off Particularly useful strategy if

a technology where it is proposed to license many times on a non exclusive basis

a technology that complements the existing technology of the recipients Should not be regarded as a first strategy Should be regarded as a strategy to employ when other strategies are

inapplicable or exhausted

Undertake roadshows to all potential licensees to progress an assessment and discussions

Marketing plan strategy

Databases of available technologies

Some research organisations put their technologies on their web site to identify technologies available for licensing

Works if you are MIT or Stanford For others, not acknowledged as likely to lead to licensing opportunities Most research organisations don’t put their technologies on their wewb site,

because it isn’t acknowledged as working

Commercial databases: https://members.knowledgeexpress.com Databases of technologies available for licensing Has operated for some years Very much a hit and miss approach

Marketing Plan is a living document

A Marketing Plan is not a static document It needs to be a living document This means that it must be continually reviewed, assessed, updated

Strategies that are not working need to be put in the back seat (for possible later use)

Strategies that are working need to be focused on

New networks and relationships are formed all the time New marketing opportunities arise from those new networks and

opportunities

Marketing Plans Must not remain idle They must be implemented

Conclusion

Licensing and commercialisation occurs More often between people who know each other Less often between people who don’t know each other

Licensees don’t come knocking on your door because you might have technology

interesting to them Or, don’t come knocking on your door at ll

The key to a successful licensing strategy is to proactively go out and expand your network the more people that you know the more likely you will find someone that will be interested in doing a

deal with you