1. IP Issues in Research Jim Baker, Executive Director Innovation, and Industry Engagement

2. 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.

3. Outline Background – Terminology – University Policies – Federal Rules Federal Contracting Issues Industrial Contracting Issues Patent Commercialization and Licensing Basics Using IP to grow your Research Program

4. 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.

5. University Policies

6. 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

7. 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.

8. 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

9. Technology Commercialization Process Enablement Demonstration Development Probability of Success Effort/Time Idea InventionPatentLicense Invention Disclosure Commercialization Stage Commercialization Steps

10. Get Started – Invention Disclosure University forms Know the details Identify applications/partners

12. 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.

13. 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

14. 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

15. Example Outcomes to-date ~ $800,000 in sponsored research – 3 years Ph.D. student funding – 2 years lab tech funding 4 publications in preparation 6 published conference proceedings $25,000 in royalties Equity in startup company (indeterminate value)

16. 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

17. 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: – Appropriate contract term negotiation – Managing conflicts of interest – Startup business development – Commercialization planning and implementation

18. Contacts Jim Baker Executive Director, Innovation and Industry Engagement jrbaker@mtu.edu 487-2228 Robin Kolehmainen Patent/License Manager rakolehm@mtu.edu 487-2228

19. Web Resources Intellectual Property Internal Forms: http://www.mtu.edu/research/references/forms/#ted