IP Commercialisation by Research Institutions

Sandeep Hegde M.

BananaIP

Objectives of Commercialization

• Reaching Public Funded R&D to People• Meeting Expectations of the Public• Fund Raising for further research• Working of Patents

Achievement Means

Statistics from USA (Source: Current Science)

Year Investment(in million USD)

Inventions Disclosed

Patents Filed Licenses Issued

2009 53560 20184 11961 4347

2008 51205 20020 12153 4125

2007 48603 19740 11749 4323

2006 45062 18792 11583 4176

2005 42052 17315 10236 4140

Top Research Institutes in India

• Center for Scientific and Industrial Research (CSIR)

• Central Food Technology Research Institute (CFTRI), Mysore

• Indian Institute of Technology (IIT), Bombay• Indian Council for Medical Redearch, ICMR

Necessary Infrastructure

• IP Policy and Process• Structured Approach to Protecting IP• Dedicated Technology Transfer Offices (TTOs)• Other Supporting Systems

What is a license?

Licensing Transactions

• In Licensing-– Taking exploitation rights from another

person/entity– You are the ‘Licensee’

• Out Licensing-– Giving exploitation rights to another person– You are the ‘Licensor’

Licensing Opportunities

Types of LicensesTypes of Licenses

ExclusiveExclusive SoleSole Non-ExclusiveNon-Exclusive

Only the Licensee has the right to exploit

Both the Licensee and the Licensor have the right to exploit

Multiple Licensees may exist at the same time

Nature of License

• Perpetual/Limited in term

• Revocable/Irrevocable

• Royalty/Royalty free

• Entire World/Limited in Territory

Grant clause– Enlists the exploitation rights provided

– Enumerates the restrictions on the exploitation

– Usually provides specific exclusions on what rights are not given

– Nature and type of license can be deciphered from this clause

E.g.X Grants Y a non-exclusive, irrevocable, royalty free license to use

the tools developed during the R&D conducted by X for Y during the term of this agreement.

Performance Obligations• Per Market Entry Milestones- to reach market entry

pointE.g.: Production of prototype;Undertaking a trialMeeting regulatory requirements

• Sales Targets- post market entryE.g.: Minimum GuaranteeQuantum

• Quality Control

Term & Termination• Term should be clearly mentioned

• Types of termination-– Convenience– Mutual– Breach– Conditional– Operation of Law

• Post termination obligations– Residual obligations– Destruction/return of IP– Certificate of destruction– Maintain confidentiality

RoyaltyRoyalty

Lump sumLump sum Continuing royaltyContinuing royalty Mixed RoyaltyMixed Royalty

UpfrontMinimum Guarantee

Share of Gross/Net RevenueFixed periodic royalty

INDEMNITY

• One of the most negotiated clauses

• Compensation for damages or loss

• Inherent IP violation risk vis a vis IP risk due to usage by Licensee

• Attorney Costs!

Governing Law & Jurisdiction• Governing Law

– Choice of law– May be mutually agreed– Laws of which jurisdiction will govern the interpretation

• Jurisdiction– Choice of forum– Courts of a specific country

• Arbitration & other ADR clauses

THANK YOU.

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