/  December 21, 2016

What You May Not Know About Intellectual Property Management and Innovation Licensing at the UW

Say you are an innovator in the University of Washington community, whether faculty or staff or student, and you have a good idea for a product or service based on your research that you’d like to commercialize. Thus will commence a process that likely includes more research, development, the securing of funding, and connecting with industry experts. CoMotion can offer you a variety of services to get you started in that regard, including mentoring from one of our Entrepreneurs-In-Residence, or gap funding, whether directly from the CoMotion Innovation Fund or with help getting product development grants from the National Science Foundation, among others. One of the most important parts of translating your innovation into an end-product or service will be securing your intellectual property as appropriate for your situation, and then licensing the innovations that you have worked to develop in an appropriate manner.

Managing intellectual property and licensing innovations in an academic environment is different from doing so in a corporate setting, with different principles to consider. Even among universities, there are a variety of approaches to licensing. Within universities, too, circumstances will vary based on the type of innovation, the proposed business plan, and other factors. Regardless of those differences, however, universities share certain core values that they should endeavor to maintain.

In the summer of 2006, Arthur Bienenstock, then Dean of Research at Stanford University, gathered a group of licensing personnel from premier institutions around the country to think about the issues that technology transfer in a university setting raises. (The University of Washington was one of the participants.) The meeting produced a document of nine principles. Although written ten years ago, the principles are still relevant today. An edited version of them is below; you can read the list in its entirety, with additional commentary on some of the points, here. Note: we use the term “innovation” in lieu of “technology” in the below text as it is a broader and more inclusive definition for the faculty, students and staff we work with. Additionally, the term “technology transfer” is limiting and does not reflect the breadth and scope of services offered by CoMotion today.

1. Universities should reserve the right to practice licensed innovations and to allow other non-profit and governmental organizations to do so. To preserve the ability of all universities to perform research, ensure that researchers can publish the results of their research in dissertations and peer-reviewed journals, and that other scholars can verify published results without concern for patents, universities should consider reserving rights in all fields of use, even if the innovation is licensed exclusively to a commercial entity, for themselves and other non-profit and governmental organizations.

2. Exclusive licenses should be structured in a manner that encourages innovation development and use. An exclusive license is often necessary and appropriate. However, technology transfer offices should be aware of the effects such licenses can have on future research efforts, or unanticipated uses of an innovation that might arise. Universities should thus refrain from granting overly broad exclusive rights, and grant instead just those rights needed to encourage development of an innovation. Furthermore, they are encouraged to use approaches that balance a licensee’s legitimate commercial needs against the university’s goal (based on its educational and charitable mission and the public interest) of ensuring broad practical application of the fruits of its research programs.

3. Strive to minimize the licensing of “future improvements.” Although licensees often seek guaranteed access to future improvements on licensed innovations, the obligation of such future innovations may effectively subordinate a faculty member’s research program to the company. In particular, if such future rights reach to innovations made elsewhere in the university, researchers who did not benefit from the licensing of the original innovation may find their own opportunities restricted. Exclusive licensees should therefore not automatically receive rights to “improvement” or “follow-on” innovations.

4. Universities should anticipate and help to manage technology transfer related conflicts of interest. Technology transfer offices should be conscious and sensitive about their roles in the identification, review and management of conflicts of interest, both at the investigator and institutional levels. Ideally, the university has an administrative channel and reporting point whereby potential conflicts can be non-punitively reported and discussed, and through which consistent decisions are made in a timely manner.

5. Ensure broad access to research tools. Consistent with the mission of the typical university to advance scientific research, universities are expected to make research tools as broadly available as possible. Through a blend of field-exclusive and non-exclusive licenses, research tools may be licensed appropriately, depending on the resources needed to develop each particular invention, the licensee’s needs and the public good.

6. Enforcement action should be carefully considered. In considering enforcement of their intellectual property, universities must mindful of their primary mission to use patents to promote innovation development for the benefit of society. All efforts should be made to reach a resolution that benefits both sides and promotes the continuing expansion and adoption of new innovations.

7. Be mindful of export regulations. University technology transfer offices should have a heightened sensitivity about export laws and regulations, and know how these bodies of law could affect university licensing practices. Licensing “proprietary information” or “confidential information” can affect the “fundamental research exclusion” (enunciated by the various export regulations) enjoyed by most university research, so the use of appropriate language is important. Diligence in ensuring that innovation license transactions comply with federal export control laws helps to safeguard the continued ability of technology transfer offices to serve the public interest.

8. Be mindful of the implications of working with patent aggregators. With increasing frequency, university technology transfer offices are approached by parties who wish to acquire rights to the majority of university patents, which are unlicensed, in order to commercialize it through further licenses. These patent aggregators typically work under one of two models: the ‘added value’ model, and the so-called ‘patent troll’ model. In contrast to patent aggregators who add value through innovation-appropriate bundling of intellectual property rights, there are also aggregators (the ‘patent trolls’) who acquire rights that cut broadly across one or more technological fields with no real intention of commercializing the technologies. The latter kind of aggregator typically extracts payments in the absence of any enhancement to the licensed innovation. Universities would best serve the public interest by requiring their licensees to operate under a business model that encourages commercialization and does not rely primarily on threats of infringement litigation to generate revenue.

9. Consider including provisions that address unmet needs, such as those of neglected patient populations or geographic areas, giving particular attention to improved therapeutics, diagnostics and agricultural innovations for the developing world. Universities have a social compact with society, with a central role in helping to advance knowledge in many fields, and to manage the deployment of resulting innovations for the public benefit. In no field is the importance of doing so clearer than in medicine. Universities should always strive to construct licensing arrangements that ensure underprivileged populations have low- or no-cost access to adequate quantities of medical innovations. Through thoughtful management and licensing of intellectual property, drugs, therapies, and agricultural innovations developed at universities can help to alleviate suffering from disease or hunger in historically marginalized population groups.