A Guide to Intellectual Property Management & Commercialisation

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1 A Guide to Intellectual Property Management & Commercialisation The following is a brief overview Intellectual Property management & commercialisation focussing on patents and copyright, the most common forms of IPR within The University. Please contact the IP Office on ext for further information. 1. Intellectual Property (IP) and Intellectual Property Rights (IPR) IP may be defined as: "The products of creative effort". It includes, but is not limited to, the results of research in the form of data, inventions, notes, records, books, papers, designs, art work, music, software, business methods, schemes for processing and assessing information and mathematical formulae. IP Rights are the legal rights that protect IP from inappropriate use or exploitation by others. The forms of IPR are limited and in the UK consist of the following: patents copyright database rights (form of copyright) registered and unregistered design rights plant breeders rights registered and unregistered trade marks 2. Intellectual Property Ownership and The University IP generated by University employees belongs to the University if it was made in the course of normal duties or during circumstances where an invention might reasonably be expected to take place. Unfettered IP (not owned by a third party) generated by students belongs to the student. If the inventorship is shared with a member of staff and the University elects to protect the IP, the University will request the student to assign their rights to the University. If you believe that you have generated IP during the course of your research, you should contact the IP Office who will send an IP assessor to take details of the IP or 'disclosure'. The University will assess the IP and determine whether or not to protect and commercialise the IP. If the University elects not to proceed it will assign its rights to the inventor(s). This assessment is undertaken by an internal Commercialisation Panel. The protection and commercialisation of IP can be very costly and it is not possible for The University to proceed with every disclosure it receives. Although a given invention may represent excellent science and high quality academic endeavour it does not necessarily follow that the technology will have clear commercial applications or industrial value. 3. Patents a) Is my invention patentable? A patent protects the inventive nature of an idea and must fulfil the following criteria: Novelty - it must new and must not have been made public in any way Non obviousness or inventiveness - would someone working in this field have deemed this an obvious thing to have tried. Capable of industrial application or utility - patents are to protect functional inventions which are destined to provide new products or services. Version 3.0, November

2 Procedure for IP Management and Commercialisation Initial Disclosure detailed information on invention provided (by academics to IP Office or School BDE) Urgent filing required e.g. publication imminent Due Diligence - determination of inventorship, ownership patentability & commercial potential (by IP office with assistance from inventors) No Release to inventor for publication/exploitation Yes No Commercialisation Panel Approval - approval of costs on basis of commercial potential, includes School 1/3 rd costs (by BDE/IP office) Release to inventor for publication/exploitation Yes Drafting of patent specification and Initial Filing (UK, US) (by inventors with assistance from IP office) Commercialisation phase Commercial Strategy Confirmed (may be license or spin-out) Patent Prosecution (includes responses to examiner's reports by inventors) Licensing/Spin-out formation (Inventors will be required to assist by meeting with potential licensees. Founders may have a very substantial involvement) Generation of revenue/revenue sharing Version 3.0, November

3 b) Confidentiality and disclosure Details must not be disclosed orally or in writing, other than under cover of confidentiality, until a patent has been filed. Any form of publication, including poster or abstract submissions at conferences, constitutes disclosure. Novelty searches of both academic and patent literature must be undertaken in order to ensure that the inventor hasn't been 'beaten to it'. You may search the Derwent patent database using your Athens password through the library on-line databases. You should take great care with the wording of titles and abstracts on research grant proposals which may be published if the grant is awarded. c) What are the key stages to obtaining a patent? I. Preparation and filing of the patent specification The University may engage a Patent Agent to assist with drafting. Standard practice is to start by filing in the UK. The drafting process requires considerable input from the inventors and may go through several drafts before filing. The draft specification should include: Background information, Other similar inventions (prior art) and differentiation of the invention from the prior art, A description of the invention, Advantages of the invention over the prior art, Specific examples and any relevant drawings or figures Claims Disclosure - if an invention has been disclosed it will no longer be possible to file in the UK and most other countries. However, for up to one year after disclosure, it is still possible to file in the US and Canada where first to invent rather than first to file applies. II. The 12-month Stage; PCT or National Phase? Before the 12 month stage, claims need to be filed if not previously lodged. Additional material can be added providing it does not introduce a new invention and has not previously been disclosed. To continue prosecuting the patent in other countries, we either nominate those countries at this stage, the National Phase, or enter the Patent Co-operation Treaty (PCT) phase. Entering PCT keeps an option open to enter the more expensive National Phase at a later date. The patent stays in PCT until 18 months after entry. Variations: If there have been no disclosures in the 12 months after filing it is possible to withdraw the patent and refile. This loses the priority date but gains an extra year's protection at minimal cost. Publication of the patent occurs approximately 18 months after the initial filing. III National Phase Each country will go through novelty searching and examinations and patents are frequently split into several patents with each covering a specific aspect of the invention. As each prosecution proceeds, there will be responses to examination reports required. The patent lasts for 20 years from the original filing date. d) How much does it cost? Costs are divided 1/3 rd :2/3 rd between the School or Division and RSCO. Version 3.0, November

4 The costs are extremely variable, depending on a) the nature and complexity of the particular invention, b) how many objections are raised during prosecution and c) in which territories you are seeking patent protection. Guideline costs are: 2-5K for drafting and filing (0 months) 3-5K for PCT entry (12 months) 2-4K for PCT search, examination and response (12-30 months) 8-12K for National phase entry (30 months) 15-50K for National phase prosecutions, translation fees and maintenance fees following grant. (30 months - 20 years) To get a single patent to grant in USA, Europe and Japan costs k. e) Inventorship For a patent to be valid, the inventorship must be absolutely correct. Errors arising from naming a non-inventor or from not naming a bona fide inventor can lead to major problems in obtaining a patent. A sense of team spirit often leads to an 'over-declaration' of inventorship, or alternatively individuals may feel they have a right to be named as an inventor when they carried out many of the practical aspects of a project even though they did not originate the ideas behind that project. S7 (3) of the Patents Act 1977 defines the inventor as "an actual deviser of the invention" i.e. the person who first conceives the idea underlying the invention. If you are unable to unambiguously assign inventorship, an IP professional or a patent agent working in the capacity of an arbitrator may need to advise further. 4. Copyright Copyright is the IPR which protects original literary, dramatic, musical or artistic works. It therefore covers things such as entries in databases, lab books, novels, presentations and teaching materials, posters, the look and feel of software displays and source code. What does copyright protect? Copyright protects from piracy but it does not protect the idea or inspiration which is embodied in such materials. What can be copyrighted? If you are a UK citizen, a resident of the UK or a legal entity within the UK and produce any of the above materials, then as long as they are original, they will be covered by copyright. How do you get copyright protection? This is an automatic right in the UK and will come into existence as soon as the protected article or text is generated. There is no requirement that you assert ownership of the copyright, but it is wise to state who owns it and to date it. How much does it cost? - In the UK it is free. 5. Commercialisation There are a variety of mechanisms by which technology offerings are made to potential licensees. These include: Articles in Trade Journals Mailshots to companies identified as potential licensees Version 3.0, November

5 Mailshots to technology transfer/consultancy organisations Attendance at partnering or specific technology related conferences to promote technology offerings Deals around IPR The nature of IPR means that there are a specific set of deal structures which are normally constructed around IPR trading. The consideration for entering into such agreements may include an up-front fee, milestone payments, royalties or equity in the form of shareholding. Option (Evaluation Licence) Agreements Technologies coming out of academic institutions are frequently very early stage and may therefore represent a large risk to a licensee. Potential licensees may be reluctant to commit to a full licence and may wish to licence the technology only for a short period to enable them to evaluate it fully. The Option is usually exclusive, for a period of time which is long enough either to test the technology in house, or to sponsor research at a University or private lab to test the technology. Licence Agreements Licence agreements are extremely flexible contracts which can be relatively simple or extremely complex. Non-exclusive licence: the same technology is licensed for the same use to a number of licensees Exclusive licence: the single licensee is the only person who can exploit the invention, to the exclusion of even the IPR owner Exclusive by Field of Use: the invention is licensed to a licensee for one use, but possibly to another licensee for a different use which is non-overlapping Assignment In some instances, the party interested in the technology will want to take assignment of the technology rather than a licence. This is the transfer of legal title i.e. of ownership. Spin-out company formation In this case the IPR is either licensed or assigned to the new company. A licence with a commitment to assign at a later date eg once the new company is capitalised to a certain sum, is the best way to protect IPR from the financial uncertainty of a new venture. 6. Revenue Sharing In the event of commercialisation of IP, as an incentive to inventors and at its discretion, The University may elect to share revenue in the following proportions: The first 25,000 of the aggregate net revenue will be apportioned as follows: 50% to the Inventor(s) 30% to the Inventor(s)' School(s) or Division(s) 20% to central funds to promote and enhance technology transfer Thereafter the aggregate net revenue will be apportioned: 40% to the Inventor(s) 20% to the Inventor(s)' School(s) or Division(s) 40% to central funds to promote and enhance technology transfer Version 3.0, November

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