From Invention to Start-Up Resources at the UW Alan C. Nelson, Ph.D. Chairman and VisionGate, Inc. & Affiliate UW November 21, 2006

1980 Bayh-Dole Act (P.L ) Universities would own the patent rights resulting from government sponsored research Universities would own the patent rights resulting from government sponsored research Mandate to bring those inventions to commercial partners for the benefit of the public Mandate to bring those inventions to commercial partners for the benefit of the public Catalyst for the formation of university tech transfer offices Catalyst for the formation of university tech transfer offices

1994 WA Ethics and Public Service Act (RCW 42.52) Ensures that all state employees conduct business with the highest ethical and moral standards Ensures that all state employees conduct business with the highest ethical and moral standards Overly strict interpretation resulted in conflict of interest and property use directives that were not business friendly Overly strict interpretation resulted in conflict of interest and property use directives that were not business friendly Inconsistencies arose Inconsistencies arose Policing of faculty discourages entrepreneurialism Policing of faculty discourages entrepreneurialism

2005 Revised WA Ethics Law Universities now allowed to develop their own administrative processes that would apply in place of the previous obligations under RCW Universities now allowed to develop their own administrative processes that would apply in place of the previous obligations under RCW 42.52

Sections Superceded Financial interests in transactions Financial interests in transactions Assisting in transactions Assisting in transactions Employment after public service Employment after public service Compensation for official duties Compensation for official duties Compensation for outside activities Compensation for outside activities Honoraria Honoraria Gifts Gifts Use of persons, money or property for private gain Use of persons, money or property for private gain

New Possibilities? No matter what, full disclosure is paramount No matter what, full disclosure is paramount You can consult and be paid in cash and stock—and the sky is the limit! You can consult and be paid in cash and stock—and the sky is the limit! You can be a founder and director, but do not manage the day-to-day business You can be a founder and director, but do not manage the day-to-day business You can use your office, computer, library, etc. in a de minimis manner You can use your office, computer, library, etc. in a de minimis manner Take a leave of absence—be a CEO Take a leave of absence—be a CEO

NeoPath, Inc. Founded in 1989 while on the faculty Founded in 1989 while on the faculty Hired early employees including several graduate students Hired early employees including several graduate students Served on the Board of Directors Served on the Board of Directors Received cash and stock grant Received cash and stock grant Was granted leave of absence Was granted leave of absence Left the university to run the company and take it public Left the university to run the company and take it public

VisionGate, Inc. Founded in 2001 Founded in 2001 Brought the company into the UW Brought the company into the UW Collaborate for $4M in government funds Collaborate for $4M in government funds Pay faculty and students to be on the team Pay faculty and students to be on the team Co-invent new IP and pursue patents Co-invent new IP and pursue patents Offer to make the UW a co-investor…. Offer to make the UW a co-investor….