Industry’s Perspective on Industry-University Intellectual Property External Research Directors Network Industrial Research Institute, Inc. April 17, 2001

Agenda Benefits of Industry/University Research Projects Intellectual Property Scenarios Commercialization Steps Other issues Conclusions

Benefits of Industry/University Relationships Industry Competitive Advantage Source of Employees –Long Term –Short Term Research Results Extension of technical competencies Cutting edge research University Relevant sponsored research projects Funding Equipment Donations Student and professorial employment Consulting Shared Knowledge

Major Roles Industry Provide goods and services Capitalize on new ideas Provide employment opportunities Make a profit University Educate our society Train new scientists and engineers –Continue to be on the leading edge –Offer modern equipment and facilities –Graduates that are sought after Valuable Research –Publication –General dissemination of knowledge There is much common ground between the two parties.

Value  To be a successful relationship, there needs to be an increase in value from the relationship for both parties. From the viewpoint of industries, that translates into “Competitive Advantage” as the major driving force. 

Importance of Intellectual Property Industry Perspective Allows for potential competitive advantage Can be used as building block for additional IP Is a part of the overall company strategy from concept to sales Is part of a portfolio University Perspective Potential future compensation to the University/Faculty based on patented information Prestige Potential spin off companies

5 IP Arrangements 1) Industry owns the IP generated as a result of the collaborative research. 2)Industry owns the IP but allows the University to continue with development for research purposes only. 3) The University owns the IP but industry has exclusive rights. 4) The University owns the IP but the business has exclusive rights in a narrow field of use. 5) the University owns the IP but offers the technology non-exclusive, royalty free. Increasing Number of collaborative opportunities

The Industrial Model Intellectual property Proprietary position Competitive advantage Unique product Innovation Acceptance in the Market place

Commercialization Costs/ Revenues/Risks

Issues to be Considered in Negotiations Which party initiated the idea? Who is contributing financially? –Money, Equipment, Feedstocks, Supplies Who is contributing technically? Cost of the overall development program? Cost to bring it to market? Risks --> Who pays for the failures?

Who is Best Suited to File for Patents? Industry –Full time experienced staff –Focused on market segments –Can select the proper foreign filing –Works with the people who are developing the use and market –Knows where the technology can be applied to similar opportunities. University –Has experienced staff but is spread thinly –Communications between the scientists and IP personnel is more distant –Scientist is not connected to the market –Do not foreign file due to costs, - limited protection –Their market is industry We Think Industry is best suited.

Other Issues Patents –Need to balance publication timing with IP requirements –Costs  who pays, who owns, who maintains –How can industry be kept informed of status –Foreign Filings Background rights –Important for commercializing a product –May be as important as technology developed

Conclusions Benefits of universities, industry and society working together: –Sponsored research projects: funding, equipment and resource donations –Shared knowledge –Source of employment –New idea generation Industry’s main driving force is competitive advantage. Industry should have strong ownership rights when they pay for the research. The overall road to commercialization is a long, twisted and risky experience. Patents, Maintenance, and Patent strategy should be done by industry. Timing of publications should consider the overall IP requirements.