Patent License Agreement Technology Transfer by itt14205


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									                                       Telemedicine & Advanced Technology Research Center
                                                                    Cutting Edge Medical Technology


 Technology Transfer and Insertion

Robert E. McCarthy PhD, JD
Chief, Office of Research and Technology Applications
Top Patenting Organizations: Calendar Year 2004
(Utility Patents granted by the US PTO)

  Rank     Number Patents    Organization
  1        3,248             IBM
  2        1,934             Matsushita Electric
  3        1,805             Canon Kabushiki
  4        1,775             Hewlett Packard
  5        1,760             Micron Technology
  6        1,604             Samsung Electronics
  7        1,601             Intel Corporation
  8        1,514             Hitachi Ltd.
  9        1,310             Toshiba Corp.
  10       1,305             Sony Corp.
Rank   Number Patents   Organization

  11   1,296            Fujitsu Ltd.
  12   1,217            Philips Electronics
  13   1,025            Fuji Photo Film
  14   976              General Electric
  15   913              Renesas Technology
  16   903              Robert Bosch Gmbh
  17   898              Texas Instruments
  18   839              Seiko Epson Corp.
  19   829              US Government
  20   813              NEC Corp.
Only 3 to 5% of US Government Inventions make it to
commercial success. Why?

• Lack of inventor interest
• Lack of funds to further R&D on the invention
• Invention easily superseded by another technology
• Inadequate marketing to showcase the invention
• Difficulty in identifying the “right” commercial
• Invention requires significant regulatory hurdles
• No mechanisms to aid in transferring the technology
              Technology Transfer
What Is It?

Who Does It?

Who Benefits?

How Is It Done?

What Laws/Rules Apply?
       Technology Transfer Legislation
•   Stevenson-Wydler Tech. Innovation Act 1980
•   Bayh-Dole Act 1980
•   Small Business Innovation Develop. Act 1982
•   Federal Technology Transfer Act 1986
•   Executive Order 12591 (1987)
•   Technology Transfer Commercial. Act 2000
•   United States Code (USC Title 15, Chapter 63)
Stevenson-Wydler Technology Innovation Act

• Established technology transfer as a mission of
  the federal government
• Required federal labs to set apart a percentage
  of the lab budget for technology transfer
• Established an Office of Research &
  Technology Applications in each lab
• Gave preference to industrial technology
  transfer partners that manufacture products in
            Bayh-Dole Act of 1980

• Provided exclusive rights to inventions arising under
  funding agreements with federal agencies to
  nonprofits and small businesses
• Permitted universities and nonprofit organizations,
  and small businesses to obtain title to inventions
  developed with government support
• Government owned and operated labs were permitted
  to grant exclusive licenses to commercial
  Federal Technology Transfer Act of 1986

• Enabled federal labs to enter into CRADAs and to
  negotiate licensing arrangements for patented
  inventions made at the labs
• Required that government employed inventors share
  in royalties from patent licenses
• Provided for the exchange of personnel, services, and
  equipment among federal labs and nonfederal
• Provided a charter and funding for the Federal Lab
  Consortium (FLC) for technology transfer
  Types of Technology Transfer Agreements

• Material Transfer Agreement (MTA)

• Educational Partnership Agreement (EPA)

• Test Services Agreement (TSA)

• Cooperative Research & Development Agreement

• Patent License Agreement (PLA)
Cooperative Research & Development Agreement

• Primary Instrument for federal technology
• Authorized by Title 15, Ch 63, section 3710
• Not a contract (cooperative agreement or
• IT IS: Mutual assent to work collaboratively
  with a nonfederal party
• 2 types – full CRADA or Transfer of Material
  or Information CRADA
               CRADA RULES

• CRADAs are not government acquisitions
• Must have at least one non-federal party
• Funds can flow to federal party, but not from federal
• Resources are used for R & D and is consistent with
  mission of the organization
• Contains a Statement of Work (SOW)
• Gov’t retains a nonexclusive, nontransferable,
  irrevocable paid-up license to inventions developed
  under the CRADA
• An export control license may be required

• True collaboration between parties- either funded or not
• Defines topic of research with a detailed SOW
• Background- what each partner brings to the effort;
  responsibilities of each partner
• Financial obligations
• Reports
• Inventions and Patents
• Data Rights and Publications
• Termination and Disputes
• Duration of Agreement and Effective Date; Modifications
• Proper signatories to the agreement
              Patent License Agreement

• Definition: Grant by an IP owner to another party of the rights
  to use the IP. It may be non-royalty (X-license) bearing or
  royalty bearing (paid up or a running royalty based on sales of
  goods or services.
• Licenses are either exclusive or non-exclusive/field of use
• Patent license is an important vehicle for granting permission
  to share in IP rights
• In the US, royalties from patent licensing have increased from
  $15 billion in 1990 to more than $110 billion in 2000
• Provides an opportunity to do business in a market without
  upfront R&D expenditure
• DoD Services and Agencies are eager to identify NEW
  licensees for DoD patented technologies
Structure of a Patent License Agreement

  Grant Clause
  Reserved Rights
  Royalties/ License Fees
  Reports & Records
  Sublicensing Rights
  Patent Enforcement and Prosecution
  Representations & Warranties
  Term & Termination
  Assignment & Transfer
       Requirements for Patentability in U.S.A.

•   35 U.S.C. 101           Utility
•   35 U.S.C. 102           Novelty
•   35 U.S.C. 103           Nonobviousness
•   35 U.S.C. 112, P2       Definiteness
•   35 U.S.C. 112, P1       Written Description
                          Enablement, Best Mode
     Considerations in Licensing a Patent

• Due diligence in assessing the scope of the
  patent claims- seek assistance of a patent atty
• Assess commercial potential of patent
• Language to include in the License
• Establish goals before entering into
• Develop a negotiation strategy that can lead to
  a win-win for both parties
              Technology Transfer
            Partnership Intermediaries
• DoD Tech Match: web-based used to enhance
  industry/university interactions with DoD;
  opportunities, patents, labs, success stories, lab
  contacts; 30,000 site visits per month, 1800
  registered users .Web site:

• TechLink: helps the DoD and NASA commercialize
  leading-edge technology by partnering with private
  companies for the licensing, transfer, development of
  technology. In FY ’05, did 258 p’ships between 58
  DoD labs and 271 companies. Web site:
• First Link (Univ of Pitt): Focuses on first responder
  needs by supporting the development of commercial
  pathways between DoD technologies and private
  industry. Focuses on early stage need requirements.
  Facilitator with CRADAs, PLAs, and SBIRs. Web

• RTI International (RTP, NC): Offers full range of
  commercialization support services which span across
  multiple technology areas. Identifies partners, market
  and commercial potential, does licensing support and
  structuring deals. Web site:
Triple Helix Facilitates R & D…
               Through Linked Communications
        Ideas & Expertise                Concepts & Expertise      P roduct


 Faculty     “Pioneers”      Triple                $          Company
 Academia                    CeMBR
                                            “Consolidators”         $

      Laboratory $ Support              Collaborative Prototype
                             $               Development

  Geographic Distribution of Triple Helix Partnerships

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