Patent or Perish? Presented By: John F. Letchford Archer & Greiner, P.C. October 19, 2006

Academia historically has held publication in a scholarly journal the premier way to establish credibility and gain prestige.

What is Intellectual Property? Patent Patent Trademark Trademark Copyright Copyright

Inventorship Conception of an idea Conception of an idea Formulation in the mind of a definitive way of realizing that idea (ie – a concrete and complete solution to a problem) Formulation in the mind of a definitive way of realizing that idea (ie – a concrete and complete solution to a problem)

Who Is Not An Inventor? Individuals that merely act as research technicians under the direction of the actual inventors Individuals that merely act as research technicians under the direction of the actual inventors

Those researchers who continue with the mindset of publish or perish while not taking advantage of the opportunities that patents provide may be doing so at their own peril (and that of their sponsors). Those researchers who continue with the mindset of publish or perish while not taking advantage of the opportunities that patents provide may be doing so at their own peril (and that of their sponsors).

Public Disclosure – What Determines Publication? Length of time presented/exhibited Length of time presented/exhibited Expertise of the audience Expertise of the audience Lack of notice or reasonable expectation that the material displayed would not be copied Lack of notice or reasonable expectation that the material displayed would not be copied The simplicity with which the material could have been copied The simplicity with which the material could have been copied

The Easiest Way to Protect Your Invention January 1, 2007 – Publish January 2, 2007 – Patent BAD

The Easiest Way to Protect Your Invention January 1, 2007 – Patent January 2, 2007 – Publish GOOD

Provisional Patent Application Advantages Preserves international filing rights Preserves international filing rights Defers substantial patent costs Defers substantial patent costs Permits inventions to be marked as “patent pending” Permits inventions to be marked as “patent pending”

Provisional Patent Application Limitations Not examined by the U. S. Patent and Trademark Office (“USPTO”) Not examined by the U. S. Patent and Trademark Office (“USPTO”) Lapses in 12 months Lapses in 12 months Does not form the basis for enforceable patent protection Does not form the basis for enforceable patent protection

Provisional Patent Application Costs $100 USPTO filing fee $100 USPTO filing fee Minimal fees for legal services Minimal fees for legal services What you can do to keep those costs from escalating What you can do to keep those costs from escalating

Provisional Patent Application What We Need From You More than a generalized description of the invention and/or its performance More than a generalized description of the invention and/or its performance Legally sufficient disclosure (ie - what you are doing, lab results, working papers) Legally sufficient disclosure (ie - what you are doing, lab results, working papers) We need your research We need your research

What Happens After the Provisional Application is Filed? At the USPTO… nothing At the USPTO… nothing Provisional applications are never published by the USPTO Provisional applications are never published by the USPTO Patentability Search Patentability Search Analysis Analysis

Evolving Research When Additional Provisional Applications May Be Necessary

Non-provisional/Utility Application Must be filed within 1 year of the provisional application Must be filed within 1 year of the provisional application Formally examined Formally examined Provides enforceable patent protection if granted Provides enforceable patent protection if granted Considerable cost and time Considerable cost and time

If you’ve followed the Patent then Publish doctrine and a patent issues… The Benefits are Numerous

The Dawning of the Age of Aquarius – The Bayh-Dole Act of 1980

In 2004, U.S. Universities filed 10, 517 patent applications – 3 times more than IBM, the corporate leader in worldwide patent filings. WHY?

The Value of Academic Technology Transfer For the University – gives the academic community the opportunity to have a positive impact on products and the marketplace For the University – gives the academic community the opportunity to have a positive impact on products and the marketplace For the Industrial Community – gives the private, for-profit sector the means to tap the very significant work of new discovery found in the academic lab For the Industrial Community – gives the private, for-profit sector the means to tap the very significant work of new discovery found in the academic lab For the General Public – provide the opportunity to benefit from extraordinary new advances being made by the brightest minds For the General Public – provide the opportunity to benefit from extraordinary new advances being made by the brightest minds

Other Advantages of Patenting Before Publishing Provides an additional quantitative indicator to assess the quality and quantity of university scientific work Provides an additional quantitative indicator to assess the quality and quantity of university scientific work Gives private investors convincing evidence that the dollars they spend on academic research and development are yielding results Gives private investors convincing evidence that the dollars they spend on academic research and development are yielding results Unlike publishing, can have a tangible valuation applied to it that can be compared equally with other patents on a global scale Unlike publishing, can have a tangible valuation applied to it that can be compared equally with other patents on a global scale

Trends in University Patenting 16,871 invention disclosures – 82% deemed potentially patentable ¹ 16,871 invention disclosures – 82% deemed potentially patentable ¹ 183 institutions reported filing 10,571 new applications – 32.8% more than the previous year ¹ 183 institutions reported filing 10,571 new applications – 32.8% more than the previous year ¹ Patenting and Publishing are not mutually exclusive – 9 of the top 10 Universities filing patents in 2005 in the United States were also in the top 100 of an international ranking of Universities based on publication output in 2000 Patenting and Publishing are not mutually exclusive – 9 of the top 10 Universities filing patents in 2005 in the United States were also in the top 100 of an international ranking of Universities based on publication output in 2000 ¹ Based on results of a survey of 198 universities conducted by the Association of University Technology Managers (“AUTM”) in Fiscal Year 2004

The Dollar Value of Patent Applications¹ Licensing – The Gift that Keeps on Giving 11,414 licenses/options yielding income - $1.385 billion 11,414 licenses/options yielding income - $1.385 billion 6,116 licenses/options generated running royalties - $1.122 billion 6,116 licenses/options generated running royalties - $1.122 billion 33% of respondents reported having at least one licenses that generated more than $1 million 33% of respondents reported having at least one licenses that generated more than $1 million ¹ Based on results of a survey of 198 universities conducted by the Association of University Technology Managers (“AUTM”) in Fiscal Year 2004

Trends in Licensing Revenue In 1991, University revenue from patenting was only $200 million compared the $1.385 billion in That’s nearly a 600% increase in 13 years.

More Specifically… In 2005, the University of California and San Diego reported making $21 million on patent royalties In 2005, the University of California and San Diego reported making $21 million on patent royalties MIT reports making $45 million from IP revenue annually MIT reports making $45 million from IP revenue annually

Additional Benefits from Licensing Patents Collaborative partnerships help move new discoveries from the laboratory to the marketplace Collaborative partnerships help move new discoveries from the laboratory to the marketplace Ongoing partnerships enable researchers who make discoveries in the early stages of a University’s tech transfer program to participate in future developments with industry Ongoing partnerships enable researchers who make discoveries in the early stages of a University’s tech transfer program to participate in future developments with industry

What Is Being Licensed? ¹ 56% of Universities report making at least one new product commercially available to the public – total 567 new products 56% of Universities report making at least one new product commercially available to the public – total 567 new products More than 3,100 new products have entered the marketplace from FY1998 through FY2004 More than 3,100 new products have entered the marketplace from FY1998 through FY2004 ¹ Based on results of a survey of 198 universities conducted by the Association ¹ Based on results of a survey of 198 universities conducted by the Association of University Technology Managers (“AUTM”) in Fiscal Year 2004 of University Technology Managers (“AUTM”) in Fiscal Year 2004

Licenses Provide More Than Just a Revenue Steam ARM Ltd., a leader in microprocessor technology, sponsors 10 research assistants at an annual salary of $65,000 at the University of Michigan in return for taking co-ownership of any patents they file.

Patents are an Indicator of the Relationships Between Academic Research and Commercial Application of New Technologies Since 1980 there have been nearly 5000 startup companies spun out from U.S. University license of patents Since 1980 there have been nearly 5000 startup companies spun out from U.S. University license of patents 2/3 of these are still in operation 2/3 of these are still in operation IN FY2004, Universities spun out 462 new companies and received an equity interest in 51.9% of them IN FY2004, Universities spun out 462 new companies and received an equity interest in 51.9% of them

Simply put, the difference between not patenting your ideas and seeking patent protection…….

Baby Gets A New Pair of Shoes or…

Baby Gets A New Beach House

Patent or Perish? Presented By: John F. Letchford Archer & Greiner, P.C. October 19, 2006