University Industry Partnership

Guriqbal Singh Jaiya

Necessity of a Holistic Approach

Sustainable R&D funding

Long term R&D strategies Professional R&D management Proactive communication efforts Technology transfer strategies

Regional development in general Market development Tax, immigration and property rights laws

Good governance

National / International

Competition: International competitiveness is key for every R&D system.

Cooperation: International cooperation strengthens R&D-systems. Moreover, it creates foreign R&D demand where domestic R&D demand is lacking. Brain drain can be reduced.

National needs and possibilities: Restructuring R&D systems will have to follow national needs and possibilities, but with the perspective of international competitiveness. Focusing on quality instead of quan-tity will be essential. Setting priorities means admitting posteriorities.

No “Stop and Go Policies” in R&D

Long term: Developing R&D systems is a long term task. The political system therefore has to offer long term stability with regard to strategies and public funding. “Stop and go policies” won’t work.

Beyond political agendas: R&D strategies should not be affected by political changes in governments. There has to be an understanding of R&D needs that goes beyond electoral agendas of political parties.

Not only words! Strategies only become relevant when they are linked to objective based funding.

Regional Strategies to R&D

Regional approaches: Regional approaches to R&D and to technology transfer are decisive since every region and each economic sector are facing specific challenges and opportunities. The advantage of proximity is essential.

Regional Development: Fostering regional R&D means fostering regional development in general and regional authorities with regional revenues.

Joint efforts: Successful R&D and technology transfer strategies have to be developed as joint efforts of authorities, universities and the economic sector. Thus, also building up mutual trust.

Looking for Effective R&D Funding

Competition and accountability: Competitive fun-ding is crucial to foster scientific excellence. Funding of institutions should also be objective based. And: Objectives should be output targets.

R&D management: Universities and research insti-tutes need professional management capacities in order to successfully allocate R&D funds.

Absorption capacities: R&D funding has to take regional aspects into consideration. Not every region has the same capacity to successfully absorb R&D investments.

University Teaching is KeyWhat’s most important: Graduates are the most important output of universities and thus, their most important contribution to technology transfer. There-fore, university teaching is key – also for the econo-mic development of a country and its regions.

Best faculty: If university teaching is key – hiring the best faculty is even more important.

Entrepreneurship: Start-ups initiated by university graduates are more important for the economic tissue of a region than spin-offs of a university. Therefore, fostering entrepreneurship has to be part of standard curricula.

Including Technology Transfer in R&D

Explicit and comprehensive: Universities and research institutes should develop explicit technology transfer strategies. Moreover, technology transfer has to be part of an overall R&D management.

Basic and applied science: One of the best ways to be successful in technology transfer is to link basic and applied science.

Technology transfer is a give and take! Integrating business partners and their specific needs already in the design of research projects facilitates the transfer of innovation.

Demand Driven – Innovation Driven!

More than improvements: Demand driven R&D mostly improves existing technologies or processes. Innovation driven technology transfer has to be enhanced as well in order to achieve real innovation.

Seed money: Public money will be needed to support innovation driven technology transfer and proof of concept projects.

Matching responsibilities: Industrial partners should contribute financially. Matching funds are the most successful way to foster innovation driven technology transfer.

Specific Challenge: Addressing SME

Sustainable economic development: SME are key for a sustainable economic tissue of a region. Special attention therefore, has to be given to integrating SME in R&D networks.

Special care: SME usually don’t have the resources to tackle more than their daily business. Moreover, they don’t have ties to the scientific community. Knowing their specific needs and offering concrete services therefore is decisive for successfully addressing SME.

Technology Transfer: Some Best Practices

Regular, institutionalized contacts of universities and industrial partners can build up mutual understanding.

Specific clubs of regional companies as “group of friends of the university” seem to be promising.

Joint projects of research institutes and industrial partners

Internships in the industry as part of standard university curricula

Industrial partners lecturing at the universities

Sabbaticals of university professors in the industry

Culture of Science

Building up a culture of science: A “culture of science” is decisive for a sustainable public R&D funding – and beyond.

Bridging the gap: Professional “interpreters” are needed bridging the gap between science and a broader public.

Proactive R&D communication: Communication strategies have to address politicians, staffers, the economic sector and the public in specific ways.

Why We Want to Improve?

We need knowledge and innovation based societies not only to assure economic growth in global markets, but also to cope with the global challenges of today.

Top 100 research universities 2005 data from Shanghai Jiao Tong University Institute of Higher Education

USA 53

UK 11

Germany 5

Japan 5

Canada 4

France 4

Sweden 4

Switzerland 3

Netherlands 2

Australia 2

others 7

Others: Israel, Finland, Denmark, Austria, Norway, Russia, Italy each 1.

The Super-League in 2005 from Shanghai Jiao Tong University data

1 HARVARD USA 11 Yale USA

2 Cambridge UK 12 Cornell USA

3 Stanford USA 13 UC San Diego USA

4 UC Berkeley USA 14 UC Los Angeles USA

5 MIT USA 15 Pennsylvania USA

6 Caltech USA 16 Wisconsin-Madison USA

7 Columbia USA 17 Washington (Seattle) USA

8 Princeton USA 18 UC San Francisco USA

9 Chicago USA 19 Johns Hopkins USA

10 Oxford UK 20 Tokyo Japan

Types of academia-industry/business collaboration

(survey based on 25 universities and research institutions)

Consultations 17%

Training, seminars, conferences 13%

Organization of student, doctoral, etc. research practices 11%

Assisting the management of business processes 8%

Studies of the effectiveness of technologies/ products/services

7%

Creation of new technologies 6%

Results attained by academia-industry/business collaboration

Gaining new experience 20,9%

Making contacts with foreign organizations with similar activities

16,1%

Development of new research fields 15,7%

Initiating of new university subjects, post-graduate qualifications and courses

13,4%

Getting more information about the innovation needs of companies

12,7%

Getting actual economic information 11,8%

Receiving of additional funding 9,3%

The Mission of a University

Education, research and public service

Source of discoveries, new knowledge and basic research (upstream research)

Provide skilled and educated manpower to meet the developmental needs of the country.

The Mission of a University…

Many universities, however, are accused of

Being in ivory towers, removed from the needs of the community

pursuing knowledge of little relevance to the developmental needs of the country

producing a workforce ill equipped to meet the challenges of industry and

in general contributing very little to the practical development needs of a country

University ResearchUniversity Research

Investigator initiated – Discovery drivenInvestigator initiated – Discovery driven

University sets priorities for future researchNew faculty are hired based on these prioritiesNew faculty investigators seek research supportFaculty act like entrepreneurs within the university seeking research support form government and private sources

Network of AgreementsNetwork of Agreements

Sponsored research

Federal

Foundations

Corporate

Material transfer agreements

Consulting agreements

Collaborators who may be joint inventors

Stakeholders in the UniversityStakeholders in the University

Faculty

Deans and Department Heads

Research

Legal

Finance

University Relations

Alumni Affairs and Development

Influences on Technology TransferInfluences on Technology Transfer

Philosophy of the University

Entrepreneurial vs. Risk averse

Expectations

Proximity/Access to venture capital

Access to management

Local business community

Local assistance programs

State economic development programs

Business Development in a UniversityBusiness Development in a University

Do lots of deals, make lots of moneyRespect academic valuesInsure obligations to sponsors of researchCompliance with gov’t regulationsStay within budgetMaintain relationshipsAvoid controversy

Roles of the Roles of the Technology Transfer OfficeTechnology Transfer Office

Disclosure evaluation and patent decisions

Management of patent prosecution

Technology marketing

Licensing

Management of existing licenses

Material transfer agreements

A « UNIVERSAL » CHALLENGE

A gap between Research and Economy

Limited impact of R&D on competitiveness

Limited cooperation between RDI and SMEs

A challenge all over the world

Most countries support R&D

Gvts. expect to get R.O.I. from their R&D spending

A UNIVERSAL CHALLENGE ALL OVER THE WORLD

A « DOUBLE » CHALLENGE

Res. Scientists are not motivated to work with SMEs

SMEs are not motivated to work with « academic » scientists

STRONG INCENTIVES ARE NEEDED

Push or Pull ?

Push or Pull ?

Technology Push

From the Lab to the market

Idea of a scientist

Limiting step : selling the idea (and the project) to industry

TOP DOWN

Market Pull(Technology absorption)

From market needs to the lab AND Back to market Need identified by industry Limiting step :

Identifying the customer Identifying the need

BOTTOM UP

Push or Pull ?

Technology Push

Give more « fancy » results but it will take more time and it is very risky

Market pull (Technology absorption)

Give less « exotic » results but

much more frequent + a higher success rate

Push or Pull ?

SUCCESS RATE :

Technology push :Low (a few %)

Market PullHigh (50%, with some experience)

Market pull offers a potential usually underestimated

A Challenge !!! RDIs think almost exclusively….

« TECHNOLOGY PUSH »

S.E.T.S(*) are more interested by «  MARKET PULL »

(*)S.E.T.S. : Traditional Sectors Small Entreprises

A 3 Partners cooperation

Technological Institutes (RDIs) Provide the appropriate technology services

SMEs Identify the market needs Manage innovative projects

The Government (Ministries, agencies ..) Stimulate the process to boost the economy Provide incentives (for Scientists and for Industry) Provide assistance Often provide some funding

Targeting SMEs

The main issue is to :

Identify potentially interested SMEs

AND

« Sell » them technology services

Targeting SMEs... Conferences, seminars… Commercial fairs Brokerage events Existing networks

Regional networks (Chambers of commerce)

National networks (Innovation agencies) European networks E.U. « networking » activity (ERA-NET)

V.C. forums Private consultants Data Banks ? ……

Targeting SMEs...

Communicating with SMEs

The most efficient way to communicate is not to present what an RDI can do

BUT :To ask the manager of an SME who has had a successful partnership with an RDI to testify in front of other other SME managers

The « next » step…Building up mutual respect

It takes some time

Personal contacts

Usually the first cooperation are

« modest »

At that stage Gvt. support is needed

SMEs –RDI cooperation

Numerous way to cooperate

R&D contractsConsultingTechnology « diagnostic »……Licensing

The role of Governments:Public-Private Partnerships

Governmental programs

Many programs to support SMEs: National Regional International

One common goal : to bring assistance to SMEs to improve their competitiveness

Governmental programsTo strengthen SMEs competitiveness

Assistance for: Identifying partners Preparing a Business Plan IPR and legal matters

To provide some public funding Financial support for project

preparation Matching grants Soft loans

A few National Programs

United States : SBAEurope :

Finland : TEKES France : Oséo-Innovation The Netherlands : Senter Spain : CDTI

+ Numerous Regional programs Ex. Flanders

International Programs

World Bank projects on Tech. Development Far East (India, Korea…) Latin America (Mexico…) Eastern and Central Europe (Croatia, Ukraine…)

European Union Framework Program Research for the benefit of SMEs

Other European programs Eureka initiative

Intergovernmental (Mkt. Oriented, nationally funded) European Space Agency

Technology Transfer program

E.U. programs for SMEs

Research for SMEs (former CRAFT)

Coordination of SMEs RTD co-operation ERA-NET Eurostar

SMEs participation to RTD projects

+Various supporting actions

Network of National Contact Points Coordination and support actions

The role of Governments

To create a favourable environment

Fiscal laws

Patent laws

Encourage mobility

R&D funding allocation

The role of Governments

To provide infrastructures Incubators Technology parks

To provide assistance Financial Legal Economical

The role of Governments

Incentives, Incentives Incentives….

Incentives for SMEs

Incentives for Scientists

The role of Governments

A stable legal framework over a long time

A rigorous monitoring process To follow progress To learn (from failures)

Methods to Transfer Technology Methods to Transfer Technology

Training of students

Publication of research results

Exchange of research materials

Collaborative research projects

Consortia

Faculty consulting

Technology licensing

Start ups

Technology TransferTechnology Transfer

Commercialize research results funded primarily by the federal government for the public goodRecruit, reward, and retain faculty and studentsInduce collaborations with industryPromote economic growthGenerate income to promote and support teaching and research

Roles of the Technology Transfer Roles of the Technology Transfer OfficeOffice

Disclosure evaluation and patent decisions

Management of patent prosecution

Technology marketing

Licensing

Management of existing licenses

Material transfer agreements

Criteria for Start UpsCriteria for Start Ups

Business planExpectation that company can accomplish goalsFaculty and staff involved have cleared conflict reviewNo equity only dealsEquity represents fair value for technology licensed

Stakeholders in the UniversityStakeholders in the University

Faculty

Deans and Department Heads

Research

Legal

Finance

University Relations

Alumni Affairs and Development

University ResearchUniversity Research

Investigator initiated – Discovery drivenInvestigator initiated – Discovery driven

University sets priorities for future researchNew faculty are hired based on these prioritiesNew faculty investigators seek research supportFaculty act like entrepreneurs within the university seeking research support form government and private sources

Network of AgreementsNetwork of Agreements

Sponsored research

Federal

Foundations

Corporate

Material transfer agreements

Consulting agreements

Collaborators who may be joint inventors

Influences on Technology TransferInfluences on Technology Transfer

Philosophy of the University

Entrepreneurial vs. Risk averse

Expectations

Proximity/Access to venture capital

Access to management

Local business community

Local assistance programs

State economic development programs

Business Development in a UniversityBusiness Development in a University

Do lots of deals, make lots of money

Respect academic values

Insure obligations to sponsors of research

Compliance with gov’t regulations

Stay within budget

Maintain relationships

Avoid controversy

Changing Role of Universities

Universities key players in the Knowledge Economy. They produce the raw material for the knowledge economyUniversities are expensive institutions for any country, what ever be the level of development (investment)There is a certain expectation now that countries cannot afford to let this very important resource go unmanaged. That there must be a return on investment and that knowledge generated in universities must be fashioned to meet the needs of the country after development by others (down stream research), in many products beneficial to the community.

The Challenge of Universities

Unable to retain qualified people

Inadequate state funding, no means of creating funding sources

Inadequate infrastructure and facilities

Gap between the outcome of university research and the stage which firms can assimilate it

University Industry Cooperation -Benefits to University

Industry is the conduit through which the results of university research can be transferred, disclosed and disseminated to the public for the public benefit

It will bring in badly needed funds allowing the university to fulfill its fundamental mandate.

Supplement the income of staff to retain talented staff

Provide early exposure to universities of the inner workings of industry

Concern – will universities be able to fulfill its fundamental mandate

Universities have evolved from “public trusts to something akin to venture capital firms” - Fortune

Research should be curiosity driven not market driven

Open culture of sharing and publication now clouded in secrecy and driven by profit

Loss of control

private interests may undermine the objectivity of research by causing bias, suppression of results, and even fraud

Benefits to industry

Industry is not usually in the business of basic research whereas that is the function of university

Source of new technologies

Expert support at lower cost

Concerns…University inventions are sometimes considered too early stage (arcane!, impractical) and a lot of innovation may be required to make it ready for marketUniversities tend to publish earlyWhat follow up support could be expected from the inventor for further developmentUniversities’ mind set is academic and not entrepreneurialUniversities are less inclined to work with small firms who cannot provide the same legal and financial security as a larger firm.

StrategyStrategy ImpactImpact

RetentionistDirect use of IP in each field to maximise income; limit or control competition; create entry barriers for others; develop brand awareness; enter new areas; motivate staff

Sale and licensing options

Generate income; cultivate new markets; get ridof non-core/incidental inventions/processes; develop new products; control costs

“Ivory Tower” Lesser emphasis on commercial imperatives;greater commitment to open dissemination ofknowledge; emphasis on social mission etc.

Donation

CorporatesCorporates

Universities/CollegesUniversities/Colleges

Basic ResearchBasic ResearchBasic ResearchBasic Research

Applied ResearchApplied ResearchApplied ResearchApplied ResearchStrategies vary Strategies vary

Eastman Chemical donation to to North Carolinauniversities

AssetsAssets

ManagementManagement

ValueValue

IPRsIPRs

H&FEH&FE

Intellectual CapitalIntellectual CapitalIntellectual PropertyIntellectual PropertyIntellectual CapitalIntellectual Capital

Intellectual PropertyIntellectual Property

Internal and ExternalInternal and ExternalRelationships; IPRsRelationships; IPRs

Internal and ExternalInternal and ExternalRelationships; IPRsRelationships; IPRs

TangibleTangibleIntangibleIntangibleTangibleTangible

IntangibleIntangible

Patents; Trade Marks;Patents; Trade Marks;Copyright; Designs; Copyright; Designs;

Confidential InformationConfidential Information

Patents; Trade Marks;Patents; Trade Marks;Copyright; Designs; Copyright; Designs;

Confidential InformationConfidential Information

CollegialityCollegialityOutreachOutreach

within andwithin andbetween sectorsbetween sectors

CollegialityCollegialityOutreachOutreach

within andwithin andbetween sectorsbetween sectors

Mission RevenueMission Revenue

Revenue MissionRevenue Mission

One Mission orOne Mission orMany Missions?Many Missions?

Many MissionsMany MissionsIn A SingleIn A SingleInstitution?Institution?

IPRs and Asset IPRs and Asset Management Will Management Will

Be A Compromise?Be A Compromise?

Policies Need ToPolicies Need ToBe Flexible NotBe Flexible Not

Fixed?Fixed?

The Cultural DilemmaThe Cultural Dilemma

UNIVERSITY INDUSTRY

Commercializationof New and Useful

Technologies

Teaching

Research

Service

EconomicDevelopment

Profits

Product R&D

Knowledge for Knowledge’s Sake

Academic FreedomOpen Discourse

Management ofKnowledge for Profit

ConfidentialityLimited Public Disclosure

Blending the University Research and Entrepreneurial Cultures

Academicsresearch priorities set by investigator

grant-seeking

publications

serendipity

transfer at early stage

Industryresearch priorities set by management

profit-seeking

proprietary

control

add value before transferring

Factors that Influence University-Factors that Influence University-Industry CollaborationsIndustry Collaborations

Technological advances in science-based and technology-intensive industries

Computer softwareAdvanced materialsBiotechnology

Increased international competitivenessSlowing of public and private support for industrial R&D

Factors that Influence University-Factors that Influence University-Industry CollaborationsIndustry Collaborations

Encouragement of research collaborations

Federal research programs to promote national competitiveness through technology development

State programs to promote technology development

Changing RolesChanging Roles

“University-industry technology transfer can be a stimulant, precursor or complement to building a high skills, high wage, state economy.”

Increase in interdisciplinary research

Emphasis on commercialization

Encourage university-industry collaborations

Issues in University-Industry Issues in University-Industry RelationshipsRelationships

Ownership of intellectual property

Confidentiality

Publication

Indirect costs of research

Exchange of research materials

Concerns about University-Industry Concerns about University-Industry RelationshipsRelationships

Universities will abandon their core missions

Potential change of university research focus –less basic, more applied

University research funding tied to job creation

Conflicts of InterestConflicts of InterestConflicts of CommitmentConflicts of Commitment

Concerns about the loss of objectivity

Investigator conflicts of interest

Collection and analysis of data

Sharing results and materials

Institutional conflicts

Equity management

Patient protection in clinical trials

Useful Web SitesUseful Web Sites

Association of University Technology Managers –www.autm.net

Council on Governmental Relations –www.cogr.edu

Association of American Universities –www.aau.edu

Types of Cooperation

Direct funding of research through gifts and grants

Exchange programs and internships

Consulting by faculty

Commercialization of inventions, innovations and research findings

Discovery to entrepreneurshipSource UC Davis

Invention

Inventions: Process

Complete Invention

Disclosure Form (web)

and provide all

data on Invention

Evaluation of Invention

(2 – 4 weeks)

Depends on Extent

Of data (CSRL)

Convey Decision

To Principal

Investigator

No Patent Filing

Free to Publish

Yes, Patent Filing

Outside Attorneys File.

Collaborative –

CSRL, Inventors, Attorney

(1-3 months)

CSRL Notification of

Patent Filing to

Inventors

Free to Publish

(or make other public

Disclosure)

Inventors to complete

Declaration and

Assignment Documents

Critical

Inventions: Evaluation of Inventions (Case Manager)

Preliminary Screening for Appropriate Filing Content

Evaluation of the Product and its Market

Evaluation of Science Strength/ Evaluation of Institutional Issues

Evaluation of Patent Position

Additional Considerations

Invention: Process (continued)

ISSUANCE

Identify Licensee

Y4

YEAR 1

Y0

YEAR 2 YEAR 3

Negotiate License Option

Manage Licensee Relationship

PATENTFILING

PROSECUTIONBack and forth with the Patent Office

• Start-up?• VC?

Finding a partner company: Marketing and licensing

Identify companies that may have an interest in the invention

Related product market analysis and reportsInventor knowledge and experience

Contact companiesNon-confidential disclosuresDisclosure of confidential information under a Confidentiality Agreement

Negotiate licenseExclusive or non-exclusiveRoyalties, up-front payments, milestones etc.Due diligence provisions

Distribution of License Revenue

Inventor(s) (25%):

Divided equally among all co-

inventors

Inventor’s Laboratory(25%)

Inventor’s Department (25%)

MGH(25%)

Expenses incurred in IP protection or creation are

deducted prior to distribution of

License Income

From invention to issued patent (annual numbers)

350 to 400inventiondisclosures submitted annuallyto RVL

175 to 200 patent applications

80 to 100 patents issued

Scoring tool/

Screen Patent Office

Decision

50%

50% *License amounts vary widely and some technologies have more than one licensee

75 to 125 licenses*

3,000 lead researchers (PIs) with $1 billion in annualexpenditures

Goal of a University IP Policy

Not conflict with the primary goals of an university (teaching and research)

Balance the interests of all stake holders

The university employs the researcher, provides the facilities and its name

The researchers expends his time, energy and skills

The govt uses its scarce resources to support universities and expects the knowledge produced to promote national development

Sponsors want to own the results of sponsored research

Elements of an IP Policy - 1. Ownership

Inventions and innovations arising from activities using university resources and facilities are owned by the university

The ownership of inventions and innovations that arise from activities using government grants depends on the law of the country

US - Bayh Dole Act.

Japan

Bayh-Dole Act of 1980, USAPrior to the Bayh-Dole Act public funded research belonged to the public. 50% of all research in the US was government funded but very little was put to use. No private ownership no investment. Under the Act, inventions made by universities that have received federal funding may be owned by the university.

The inventor must disclose the invention to the university and to the government with a statement that the invention was made with government support.The government retains a non-exclusive, non-transferable, irrevocable, paid up, world wide licenseThe government can require the inventor to grant reasonable licenses to third parties under certain circumstance (march in rights)

Bayh-Dole Act Important Provisions

Universities may elect title to inventions

Universities are expected to protect IP

Government retains non-exclusive license

Government retains march-in-rights

Uniform guidelines for granting licenses

Universities must report on activities

Since Bayh-Dole came into force, nearly 5,000 companies have been spun out of American campuses, over 40,000 licence agreements have been concluded between academic institutions and outside parties. Companies with their roots in the US university system now contribute an estimated US$40 billion a year to the country’s economy. The Bayh-Dole is credited for the creation of around 1500 biotech companies, employing more than 180,000 people generating upwards of US$40 billion in revenueFor example the California Institute of Technology (CALTECH) received in one year some 10m $ in licensing revenue, filed 416 patent applications, received 142 patents, started 14 new companies.

A wide range of new products have stemmed from university -based research

Kansas State University developed nanomaterials that can neutralise a wide range of contaminants and chemical warfare agents. The technology is licensed to NanoScale Materials Inc of Manhattan, Kansas.University of North Carolina invented a software program that incorporates a 3D microscope, which allows students to experience microscopy in the classroomand from home. The technology is licensed to Science Learning Resources Inc, of Carboro, North Carolina.Researchers at Boston University, developed an optical device known as the Numerical Aperture Increasing Lens (NAIL) to produce high-resolution images of wafer circuitry.EdgeTech of Marlborough,Massachusetts, has taken a licence to a sonar technology developed at Florida Atlantic Univeristy that can be used to locate buried underwater mines.Purdue University developed a miniature mass spectrometer now licensed to Griffin Analytical Technologies Inc, of West Lafayette, Indiana. This portable device can be used to identify chemical warfare agents, explosives and toxic industrial chemicals.University of Texas scientists developed wired enzyme technology, which allows diabetes patients to measure blood glucose with a much smaller sample than required by existing methods.Allergan Inc, of Irvine, California, is selling a new drug, Restasis, which is based on technology licensed from the University of Georgia. Restasis, an immunosuppressant, decreases tear duct inflammation and is used to treat dry eye.

The Bayh-Dole Battle by Victoria Slind-Flor, Intellectual Asset Management December/January 2006

Sponsored research

Inventions arising from research sponsored other than by the government would be governed by the terms of the agreement which would normally have been approved by the university

Usually the sponsor would expect to own the results of the research (but powerful universities like UCLA own the IP even in such cases).

The Onco-mouse

On April 12 1988, the U.S patent office granted Harvard a Patent rights over the Oncomouse, a transgenic mouse designed to have a predisposition to cancer

Dupont had provided some $6 million US funding for the research that resulted in the Onco mouse and under the terms of that funding were granted an exclusive license giving DuPont the right to “make and have made, to use and have used, to sell and have sold, the Oncomouse, and to fully exploit the patent rights”.

Limits on informal exchange of mice - DuPont would not allow scientists to follow their traditional practices of sharing mice or breeding extensively from the mice. Contractual control of scientific disclosure - DuPont imposed forms of contractual control on scientists, most notably a requirement that they fulfill annual disclosure requirements; this was not a strict prohibition on publishing but a requirement that scientists using an Oncomouse would provide an annual research report on their published findings. Reach through rights on future discoveries made with an Oncomouse - DuPont required that scientists give them rights to future inventions made using oncomice. These so-called reach-through rights give the licensor of a patented technology a share in any proceeds from a product even though the original technology is not incorporated into the end product. These rights are not an integral part of patent law but instead emerge as part of a negotiation over the terms of conditions of a contract to make use of a technology – they are part of the price of use. While common in the contracts between biotechnology and pharmaceutical firms, this was the first time a company had sought to impose such a provision on academic scientists.

By late 1999, after four years of negotiations, DuPont and the NIH signed a Memorandum of Understanding under which academic scientists (when funded by the NIH) could use oncomice without cost, providing they were not using them for any commercial purpose, including research sponsored by a commercial firm.

Inventor

If the university does not proceed to patent an invention the inventor may request that the right to patent be transferred to him. The University may retain a non exclusive right to use the IP for educational and research purposes and perhaps a right to a percentage of the revenue

If the invention was made without “significant” use of the university’s resources the inventor could claim ownership

Elements of an IP Policy2. Management

Create a department/office such as a Technology Licensing Office to be in charge of managing the university’s IP assets

Responsible for the protection and commercial development of inventions and creations

Responsibilities of a TTO/TLO

Processing and safeguarding relevant IP agreements;

Determination of patentability, managing invention disclosures, undertaking patent search and completing applications for patents;

Evaluating the commercial potential of an invention;

Obtaining appropriate patent protection;

Locating suitable commercial development partners;

Negotiating and managing licenses.

Invention Disclosure

A disclosure is the first signal to the university that an invention has been made.It is typically used to give a formal description of an invention that is confidentially made by the inventor to his or her employer. It provides information about the inventor or inventors, what was invented, the circumstances leading to the invention and facts concerning subsequent activities. It provides the basis for determining patentability and the technical information for drafting a patent application.

All researchers are obliged to report to the University TLO all potential patents through the disclosure document. Premature public disclosure may affect novelty and disqualify it from patentability

An invention disclosure is treated with confidentiality by the TLO

Submitting a disclosure is the first formal step towards obtaining proper intellectual property protection through the university.

Identify commercially valuable inventions

Protect them (assess their patentability, prepare and make the patent application)

Reward employees who create such inventions

Commercialize (Locate commercial partners and negotiate licensing agreements)

Elements of an IP Policy - 3. Income Distribution

Gross income - license fees, royalties, milestone payments etc

Net income - gross income less university expenses for filing patents, negotiating license agreements etc..

Distribution of revenue - generally the inventors share and that of the university as total net revenue Many universities grant an average of 35% income to the inventor.

Start-up/Spin -OffCommercialization of research can also take place (other than through licensing to another company) through the route of a spin off company that will commercialize the inventiona spin off company is one that is established by members of university staff to exploit IP that belongs to the university

For example the university will transfer the relevant IP free of royalty to the spin off and will seek a majority shareholding in the company.

Incubators have been useful in assisting the development of spin offs

IncubatorsBusiness incubators are designed to help start-up firms. They usually provide:

flexible space and leases, many times at very low rates fee-based business support services, such as telephone answering, bookkeeping, secretarial, fax and copy machine access, libraries and meeting rooms group rates for health, life and other insurance plans business and technical assistance either on site or through a community referral system assistance in obtaining funding networking with other entrepreneurs

The primary goal of a business incubator is to produce successful businesses that are able to operate independently and financially viable.

Companies that spawned from Stanford

Altera Atheros Communications BEA Systems Charles Schwab & Company Cisco Systems Cypress Semiconductor DNAX Research Institute Dolby Laboratories eBay E*Trade Electronic Arts Gap Google Hewlett-Packard Company IDEO Intuit Kiva Linked In Logitech Mathworks McCaw Cellular Communications

MIPS Technologies Nanosolar, Inc. Netflix Nike NVIDIA Octel Communication Odwalla Orbitz Rambus Rational Software Silicon Graphics Sun Microsystems Sun Power Corp. Taiwan Semiconductor Tandem Computers Tensilica Tesla Motors Trilogy Varian Associates VMware Whole Earth Catalog Windham Hill Records Yahoo! Zillow

Stanford University – Some of the inventions licensed

Digital sound synthesis: John Chowning developed FM sound synthesis for digitally generating sounds in the late 1960s, leading to the music synthesizer.Disease management: The Stanford Patient Education Research Center develops programs for people with chronic health problems, including arthritis and HIV/AIDS. The program has been licensed to more than 500 organizations in 17 countries and 40 states.DSL: In the 1980s, John Cioffi and his students realized that traditional phone lines could be used for high-speed data transmission, resulting in patents used in asymmetric digital subscriber lines. E-mail security: Identity-based encryption, developed by Dan Boneh and Matt Franklin, offers an efficient way to encrypt and protect e-mail.Functional antibodies to treat disease: In the 1980s, Leonard Herzenberg, Vernon Oi and Sherie Morrison discovered how to mass produce antibodies— molecules that detect foreign substances—and target them for destruction by the body’s immune system. Genome sequencing: Two tools assist in the sequencing of DNA: CHEF electrophoresis, invented in 1987 by Ron Davis, Gilbert Chu and Douglas Vollrath; and Genscan software, developed by Christopher Burge. Google: The world’s most popular search engine got its start at Stanford when Sergey Brin and Larry Page developed the page-rank algorithm while they were computer science graduate students. Personalized medicine: The gene chip, based on spotted microarray technology developed in the 1990s by Pat Brown and Dari Shalon, allows doctors to create genetic profiles of patients and their diseases. Recombinant drug production: Recombinant DNA technology, developed in 1973 by Stanley Cohen and Herbert Boyer, laid the groundwork for modern genetic engineering by allowing scientists to combine pieces of DNA from different organisms.

Questions to consider

Is the mission of universities being compromised by commercial interests

Should research results funded by tax payer money be privately appropriated

If commercialization of publicly funded research is appropriate

Ensure clarity on ownership of research results

Allow each university and PRO to develop their own internal policy along the above lines within the broader national goals

Governments could inject humanitarian/public service licensing policies into such national goals

 

Trends…

Major private research labs are down sizing while smaller start ups are increasing their research activities

Companies are funding more basic and applied research in universities. Less corporate funding for the sake of public good but tied directly to corporate goals.

More funding

Less independence

Rise in “real world” research