IP Issues in Research
Jim Baker, Executive Director
Innovation, and Industry Engagement
Objectives
• Inform researchers on issues related to
intellectual property in research.
– Relevant laws, policies, and rationale for University
approach to IP rights.
– Basics of patenting, commercialization, and patent
licensing.
– Relationship of IP rights to general progress and
advancement of academic research programs.
• Breadth versus depth – follow up for details.
Outline
• Background
– Terminology
– University Policies
– Federal Rules
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Federal Contracting Issues
Industrial Contracting Issues
Patent Commercialization and Licensing Basics
Using IP to grow your Research Program
Terminology
• Ownership
– Sole control of an asset (Intellectual Property (IP) in this context).
– Subject to any legal encumbrances.
• License
– The right to use an asset/IP.
• Exclusive License
– A license under which the licensor agrees to not provide licenses to any
third party.
• Non-Exclusive License
– A license under which the licensor reserves the right to provide
licenses to third parties.
University Policies
Relevant Federal Rules
• 37 CFR 401 (Bayh-Dole Act)
– Universities own inventions created from work
sponsored by the federal government
• IRS Revenue Procedure 2007-47 (Tax Free
Bond Act)
– Prohibits use of tax-exempt financed buildings
for “private use”
– Private use includes transferring IP ownership to
sponsors at less than market value
Federal Contracting Issues
• Bayh-Dole provides the University with
ownership of inventions
• Simplifies contracting but comes with conditions
– Legal and contractual obligations to disclose
inventions to the funding agency.
– Obligation to pursue commercialization
• in the United States
• with a preference for small businesses if possible.
Industrial Contracting Issues
• University owns project generated IP
• University grants sponsors:
– A royalty-free right non-exclusive license.
– The first option to a royalty bearing exclusive
license.
• Tax-free bond act generally prohibits transfer
of ownership and up-front designation of
license terms.
• Research rights/Freedom to operate
Technology Commercialization Process
Commercialization Stage
Probability of Success
Idea
Invention
Patent
License
Commercialization Steps
Development
Demonstration
Enablement
Invention Disclosure
Effort/Time
Get Started – Invention Disclosure
• University forms
• Know the details
• Identify applications/partners
Technology Assessment
• Technical maturity
– What needs to be done to reach the market
– What are the related research needs/opportunities
• Patentability
• Is the invention ‘enabled’ – can it be reproduced
• Will a patent impact our ability to attract research funding and
commercial partners.
• Market
• Is there sufficient probability and magnitude value of revenue
(research or royalty) to justify the investment.
Leveraging IP for Research
• Technology commercialization produces
funding opportunities:
– Corporate partner research sponsorship
– Federal Small Business Innovation and Technology
Transfer Research (SBIR/STTR)
– Private Investment
– Specialized technology gap funds
– Business plan competitions
Example of Research and
Commercialization Alignment
• Discovery from federal research that has potentially significant public
benefit and commercial potential.
– $20k proof of concept study
• Michigan Universities Commercialization Initiative (MUCI).
– $60k next stage proof of concept
• Funded by MUCI
• Support letter from private sector partner.
– $230k validation study
• $70k MUCI
• $160k from private sector partner with an option to license technology
– $230k development/further research
• NIH STTR Phase I
• $110k subcontract to Michigan Tech
– Currently preparing $1.3M NIH STTR Phase II
• $370k subcontract to Michigan Tech
Example Outcomes to-date
• ~ $800,000 in sponsored research
– 3 years Ph.D. student funding
– 2 years lab tech funding
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4 publications in preparation
6 published conference proceedings
$25,000 in royalties
Equity in startup company (indeterminate value)
Funding Opportunities
• Early stage technologies
– Funding available through traditional research funding
programs
• Mid-stage technologies
– Technology gap funds
– SBIR/STTR – need corporate partner
• You can create that partner or we can seek one out
– Startup company with private investment
• Demonstrated Technology
– Corporate sponsored research and development
Michigan Tech Experience Base
• Michigan Tech is a national leader in:
– Proportion of research sponsored by industry
– Number of license agreements per dollar of research
– Number of invention disclosures per dollar of research
• As a result we have staff experienced in:
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Appropriate contract term negotiation
Managing conflicts of interest
Startup business development
Commercialization planning and implementation
Contacts
Jim Baker
Executive Director, Innovation and Industry Engagement
jrbaker@mtu.edu
487-2228
Robin Kolehmainen
Patent/License Manager
rakolehm@mtu.edu
487-2228
Web Resources
Intellectual Property Internal Forms:
http://www.mtu.edu/research/references/forms/#ted