Technology Transfer: the NIH Experience Mark Rohrbaugh, Ph.D., J.D. Director Richard Rodriguez, M.B.A. Director, Division of Technology Development & Transfer Office of Technology Transfer National Institutes of Health U.S. Department of Health & Human Services Technology Transfer Tactics Webinar December 8, 2009

Overview NIH/OTT Collaborations Success stories Patenting & Licensing Marketing resources Monitoring & enforcement Q & A

The National Institutes of Health 27 Institutes and Centers CC NLM CIT NINR CSR NINDS FIC NIMH NCCAM NIGMS NCI NIEHS NCMHD NIDDK NCRR NIDCR NEI NIDCD NHGRI NIDA NHLBI NICHD NIA NIBIB NIAAA NIAMS NIAID

Extramural Research Long tradition of interaction between Government, Academia, and Industry Over 80% of the NIH budget Over 50,000 awards annually 325,000 extramural researchers (mostly universities) Over 3,000 research organizations

Intramural Research Approximately 9% of NIH Budget More than 2,000 active projects More than 6,000 doctoral level scientists Breakthrough Technologies/Therapies

NIH Collaborations Negotiated by NIH Institutes Cooperative research and development agreements (CRADA) Material transfer agreements (MTA) Clinical trial agreements (CTA) Negotiated by OTT Non-exclusive/exclusive licenses Internal and commercial uses Patented and unpatented IP

Cooperative Research and Development Agreements (CRADAs) Agreement envisions two-way exchange of resources, information and intellectual property Collaboration between Government lab and outside party Government provides expertise, equipment, materials (no money) Collaborator provides same and possibly money

CRADAs cont. CRADAs cannot direct or restrict research in a NIH laboratory Brief delays in dissemination of research results are permitted Subject inventions created under CRADA can be solely owned by either party or jointly owned Option for non-exclusive or exclusive license CRADA research plan Government retains use license

Combination discovery Taxol® and stents 1993 Patents filed 1996-2002 License 1996 Angiotech Angiotech and NIH CRADA 1996 Sublicenses 1998-99 Boston Scientific Patents issued 1997,2002 FDA approval 2004 70% market in 1 month! 9

Examples of Products Developed Under NIH CRADAs Company Use FluMist® MedImmune Influenza vaccine Havrix® GlaxoSmithKline Vaccine against hepatitis A Taxol® Bristol-Myers Squibb Treatment of solid tumor cancers and Kaposi's sarcoma Taxus® Express Boston Scientific Treatment of coronary artery disease (drug-eluting stent) Thyrogen® Genzyme Therapeutics Adjunct to thyroid cancer treatment Velcade® Millennium Pharmaceuticals, Inc. Treatment of multiple myeloma

FY08 PRODUCTS 253 total

Centralized Technology Transfer

Decentralized Technology Transfer Cooperative Research & Development Agreements Material Transfer Agreements Employee Invention Reports Clinical Trial Agreements Technology Development Center Office of Technology Transfer (OTT)

Patentability Issues Contract law firms Public disclosures Coordination with NIH institutes Large vs. small institutes Collaborations Information flow IP database

Patent Policy Seek patent protection if: Realize the technology’s primary use Preventive, diagnostic, therapeutic Commercial or public health value Practical utility Do not seek patent protection if: Technology transfer can best be accomplished without patent protection

Organizational Structure Office of the Director OTT Marketing Royalties Division of Technology Development and Transfer Cancer Branch General Medicine Branch Infectious Disease and Mechanical Engineering Branch Monitoring and Enforcement Branch Service Center Branch Division of Policy

Licensing Goals Promote public health Bench to bedside: product development Aggressively market technology Identify “best” commercial partner Negotiate appropriate agreement Support programmatic goals Economic development

NIH Licensing Principles Preference for non or partial exclusivity Promote competition and access ~15% exclusive agreements Detailed Commercial Development Plan No defensive licenses Grant only the appropriate scope of rights Define product Specific fields of use Licensed territory becoming more important

License Principles cont. Permit research uses Exclusive agreements Academic or corporate Enforceable benchmarks Monitor agreements (at least annual)

FY09 License Data 375 applications received (~400/yr) 215 licenses executed 44% small business vs. 38% large business 82% US firms NIH does license to foreign firms

Global License Data (1987-2009) 1,400+ active licenses More than 400 products (including research tools) on the market 25 FDA approved 84 more in in clinical development $950M in royalties collected $5-6B annually in products sales by companies 

Large vs. Small Firms Types of agreements Size does matter Momentum Large firms more willing to walk away Small firms cash-strapped Momentum Efficiency At the end of the day…

US vs. Non-US Firms Getting the message out there Best partner is key goal All things being equal Special provisions/requirements US manufacturing provisions Share model agreements early

Licensing Keys to Success State clear goals Communicate early and often Internal organizational structure Buy-in from stakeholders Be flexible/current events Database and management controls

NIH Marketing Efforts OTT Product Showcase OTT Licensing Opportunities http://www.ott.nih.gov/productshowcase/ OTT Licensing Opportunities OTT Searchable database http://www.ott.nih.gov/Technologies/AbsSearchBox.aspx Federal Register http://www.gpoaccess.gov/fr/advanced.html NIH Listserve http://www.ott.nih.gov/ott_listserv/join_ott.aspx

Specialized Marketing Efforts Synapse™: Technology matching tool Contact Ajoy Prabhu: aprabhu@mail.nih.gov Pipeline to Partnerships (P2P): virtual space to showcase technology and product development http://www.ott.nih.gov/p2p Rare Diseases and Conditions Page: technologies related to rare diseases or conditions http://www.ott.nih.gov/rarediseases

Monitoring & Enforcement Post-execution monitoring critical to successful licensing program NIH has dedicated unit to monitor and enforce its agreements

What is It Collecting overdue royalty payments Reviewing licenses & identifying obligations Collecting overdue royalty payments Reviewing reports – progress, annual, sales Addressing other non-compliance issues Settling license disputes Performing/managing royalty audits Identifying and settling patent infringements

Why Do It? Verify that PHS technology is used or developed Verify that royalties owed are paid Identify unlicensed technology users Increase overall royalties collected Assure licensees are treated fairly Assure inventors are treated fairly Assure license records are up-to-date

Options for Compliance Inform/educate licensee of their obligation(s) Set deadlines for receipt of royalties/reports owed Threaten or impose “additional royalties” Suspend other licensing until owed royalties are paid Threaten with debt collection, credit bureau reporting, & excluded parties listing Negotiate amendment to restore compliance/settle dispute Notice of license termination

Other Monitoring Functions Evaluate requests for consent to sublicense Evaluate requests for consent to assign license Evaluate requests for waiver of U.S. mfr requirement Negotiate amendments – term extension & other Identify licenses for audit, manage audit, negotiate settlement Investigate infringement cases, pursue licensing

Resources Used in Monitoring TechTracS Database Communication with licensee (phone / e-mail / letter) Reports submitted by licensees Press releases, information on company web sites, SEC filings, etc. Information provided by licensees or inventors Legal advice from NIH Office of General Counsel U.S. Attorney’s Office located near licensee

Impact of Monitoring Efforts Total FY2008 Royalty Collections for NIH = $92 million Monitoring & Enforcement efforts brought in : $1.5 million in collection of overdue royalties $396,206 from new agreements & settlements $40,838 from 3rd party audits = $1.95 million (2.1% of total FY08 royalties)

Thanks & Q&A Mark Rohrbaugh, Ph.D., J.D. Richard Rodriguez, M.B.A. rohrbaum@mail.nih.gov 301-594-7700 Richard Rodriguez, M.B.A. rodrigr@mail.nih.gov 301-435-4013