INVENTOR’S GUIDETO TECHNOLOGY TRANSFER ATAARHUS UNIVERSITYAARHUS UNIVERSITET
aarhus university                                                                                                 inventor...
aarhus university4                         inventor’s guide                                                               ...
aarhus university                                                    inventor’s guide                        5The technolo...
aarhus university6                            inventor’s guide    The Process at a Glance                            input...
aarhus university                                                             inventor’s guide                            ...
aarhus university8                        inventor’s guide                                                                ...
aarhus university                                                          inventor’s guide                        9INVENT...
aarhus university10                        inventor’s guideRESEARCH CONSIDERATIONSAND MATERIAL TRANSFERAGREEMENTSWill I be...
aarhus university                                                      inventor’s guide   11What rights does a research sp...
aarhus university12                       inventor’s guideINDUSTRY AS THE NECESSARYINTERMEDIARYHow many cells are there no...
aarhus university                                                          inventor’s guide                          13OWN...
aarhus university14                        inventor’s guidePATENTSWhat is a patent?                                   inst...
aarhus university                                                          inventor’s guide                       15for pa...
aarhus university16                       inventor’s guidedatabases accessible to other people and it        the patent of...
aarhus university                                                       inventor’s guide                          17      ...
aarhus university18                       inventor’s guideCOMMERCIALIZATIONWhat are the typically steps in a commer-      ...
aarhus university                                                       inventor’s guide                       19of the ma...
aarhus university20                       inventor’s guideWho decides whether to form a start-up?            According to ...
aarhus university                                                           inventor’s guide                        21the ...
aarhus university22                       inventor’s guideREVENUE DISTRIBUTIONHow are license revenues distributed?       ...
aarhus university                                                       inventor’s guide                      23COMMERCIAL...
aarhus university24                           inventor’s guideAarhus university            Phone: +45 8942 6884Technology ...
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Inventors Guide

  1. 1. INVENTOR’S GUIDETO TECHNOLOGY TRANSFER ATAARHUS UNIVERSITYAARHUS UNIVERSITET
  2. 2. aarhus university inventor’s guide 3 The Technology Transfer Process . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Case Story: Danish-Japanese Research Collaboration Yields Exciting New Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Invention Disclosures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Research Considerations and Material Transfer Agreements 10 Case Story: Industry as the Necessary Intermediary . . . . . . . . . 12 Ownership of Intellectual Property. . . . . . . . . . . . . . . . . . . . . . . . . . 13 Patents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Case Story: Collaboration Key to Commercializing Next-Generation Personalized Medicine . . . . . . . . . . . . . . . . . . . . 17 Commercialization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Revenue Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Case Story: Commercializing a Diagnostic Technology Gave Added Benefits to Researchers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23This guide answers some of the most common Note: this booklet is based with permission onquestions we encounter from the research the University of Michigan’s “Inventor’s Guidecommunity and is organised to give a broad to Technology Transfer.” We are gratefuloverview of the technology transfer process to the University of Michigan for their kindand the services available to researchers. A permission to use their excellent material.Danish version of the web site www.au.dk/ All photos by Lars Kruse/AU Foto. Copyrightinvent is available at www.au.dk/opfind. Aarhus University 2009.Aarhus University The Technology Transfer Office at AarhusTechnology Transfer Office University also supports inventors from CentralFinlandsgade 29 Denmark Region including Aarhus University8200 Aarhus N, Denmark Hospital.Phone: +45 8942 6884Facsimile: +45 8613 5910Web: www.au.dk/pke
  3. 3. aarhus university4 inventor’s guide søren e. frandsenAn Inventor’s Guide to Technology Transfer at Aarhus UniversityDear Researcher MissionAarhus University wishes that relevant re- Aarhus University encourages knowledgesearch results are commercialized and transfer and contributes to business de-contribute to business- and socioeconomic velopment and the advancement of society.development. This is why technology transfer Technology transfer from research to industryfrom research to industry is a highly prioritised has a high priority for the university. It is thearea for the university. aim of the university to work with small andWith this guide, we want to outline the large companies alike regardless of nationa-essential elements of technology transfer at lity to develop new technologies, products,Aarhus University. I hope this guide will answer job opportunities and thereby strengthensome of the questions you may have about the university’s profile and Denmark’s com-technology transfer and that you will take petitiveness.advantage of technology transfer to see yourresearch be utilized to the benefit of yourself, The Technology Transfer Office (TTO) initiatesthe university and society. and supports technology transfer by working professionally and efficiently with researchers,Søren E. Frandsen companies and organisations to ensure thatPro-rector for Strategic Affairs the framework for research collaboration andAarhus University technology transfer is in place.
  4. 4. aarhus university inventor’s guide 5The technologytransfer processHow do I work with the Technology Transfer concept to market-ready status, and theOffice (TTO)? resources and willingness of the licenseesWe encourage you to contact the TTO du- and the inventors.ring your discovery process to ensure you areaware of the options that will best leverage How can I help in this process?the commercial potential of your research. • Contact the TTO at +45 8942 6884 or anThe process of technology transfer is sum- appropriate officer (found at www.au.dk/marised in the opposite page. Note that these pke) when you believe you have a scientificsteps can vary in sequence and often occur or technical observation with potential com-simultaneously and that the university might mercial or research value.decide to stop the process of technologytransfer depending on the progress of protec- • Complete and submit the Invention Disclosureting and/or marketing of the invention. in sufficient time to file a patent application before publicly disclosing your invention orHow long does the technology transfer pro- publishing a manuscript – preferably beforecess take? submitting the manuscript for publication.The process of protecting an invention andfinding the right licensing partner may take • To avoid risking your patent rights andmonths – and even years – to complete. The possibly hindering the opportunity to marketamount of time will depend on the develop- your invention, contact the TTO beforement stage of the invention, the market for holding any discussions with people outsidethe invention, competing technologies, the Aarhus University. If a patent applicationamount of work needed to bring a new has not yet been filed, we will give you
  5. 5. aarhus university6 inventor’s guide The Process at a Glance input) the Invention Disclosure and an outside 1. Research. Observations and experiments patent counsel conduct patent searches. during research activities often lead to disco- Other consultants might also work with the veries and inventions. An invention is any Invention Disclosure. The Patent Committee useful process, machine, composition of recommends whether or not the university matter, or any new or useful improvement of should assume the rights to the invention. the same. Often, more than one person may have contributed to the invention. 4. Protection. The process in which protection of the intellectual property rights to the inven- 2. Invention Disclosure. The written notice of tion are secured. This is done so that there is invention to the TTO that begins the formal an asset to transfer to a third party. Patent technology transfer process. An Invention protection begins with the filing of a patent Disclosure remains a confidential document, application with one or more government and should fully document your invention so patent offices. Once a patent application has that the options protecting the invention and been filed, It will require several years and a commercialization can be evaluated and lot of money to obtain an issued patent. pursued. You can find the invention disclosure form at www.au.dk/invent. 5. Marketing. With your involvement the TTO staff identifies candidate companies that 3. Assessment. The period of normally 2 have the expertise, resources, and business months in which the TTO reviews (with your networks to bring the technology to market.a Non-Disclosure Agreement for the party to significant participation on your part, we willsign before you describe your invention. strive to make efficient use of your valuable time.• On the Invention Disclosure, include compa-nies and contacts you believe might be in- • Keep the TTO informed of upcoming pub-terested in your invention or who may have lications or interactions with companiesalready contacted you about it. Studies related to your intellectual property.have shown that over 70 % of all licenses areexecuted with commercial entities knownby the inventor, so your contacts can beextremely useful.• Respond to the requests of the TTO and out-side patent counsel. While some aspects ofthe patent and licensing process will require
  6. 6. aarhus university inventor’s guide 7 This may involve partnering with an existing established companies. An option agreement company or forming a start-up. Your active is sometimes used to enable a third party to involvement can dramatically enhance this evaluate the invention and its market potential process. for a limited time before licensing. 6. Form a start-up/existing business relation- 8. Commercialization. The company licensing ship. If creation of a new business start-up has the invention continues the advancement of the been chosen as the optimal commercialization invention and makes other business investments path, the TTO will work to assist the founders in to develop the product or service. This step planning, creating and finding funding for the may entail further development, regulatory ap- start-up, but the TTO will always recommend provals, sales and marketing, support, training, the founders to consult their own legal and and other activities. financial advisors when developing a business plan and establishing a start-up. 9. Revenue. Revenues (net income) received by Aarhus University from licensees are distri- 7. Licensing. A license agreement is a contract buted with 1/3 to inventors, departments and between Aarhus University and a third party in the university each. which the University’s rights to an invention are licensed (without relinquishing ownership) for financial or other benefits. A license agreement is used with both new start-up businesses andAU Patent Committee and TechnologyThe AU Patent Committee makes recommen- • Arne Nylandsted Larsen, Depart-dations to the Rectorate regarding: transfer of ment of Physics and Astronomyrights following invention disclosure, continu- • Hans Løkke, Department of Terres-ation of commercialization as well as general trial Ecologycounselling on matters relating to intellec- • Søren Kragh Moestrup, Institute oftual property rights and technology transfer. Medical BiochemistryMembers of the AU Patent Commitee are: • Finn Skou Pedersen, Department• Chairman Erik Østergaard Jensen, of Molecular Biology Department of Molecular Biology • Morten Dam Rasmussen, Depart-• Hans Jørn Juhl, Department of Mar- ment of Agricultural Engineering keting and Statistics• Mogens Kilian, Institute of Medical Microbiology and Immunology• Christian Koch, Institute of Business
  7. 7. aarhus university8 inventor’s guide Peter kristensenDANISH-JAPANESE RESEACH COLLABORATIONYIELDS EXCITING NEW TECHNOLOGYA research collaboration between Associate that, in addition to specific recognition, canProfessor Peter Kristensen, Department of be used in open sandwich immunoassays.Molecular Biology, Associate ProfessorHiroshi Ueda, Department of Chemistry The scope of the application area for this tech-and Biotechnology, University of Tokyo, and nology is extensive, ranging from measuringResearch Fellow Masayuki Kawakami, small amounts of antibodies in the blood toFUJIFILM Corporation, led to the development the presence of pesticides in field samples.of a patent-pending technology that will po- The researchers will continue to collaboratetentially enable faster and more efficient pro- on further research while FUJIFILM Corpora-duction of novel binding molecules capable tion’s Life Science Laboratories will developof specifically recognising the presence and and commercialize the technology. As aamount of small analytes in complex solutions. result of the collaboration Aarhus University,The researchers have developed a method the University of Tokyo and TODIA TLO Ltd.,that combines the ability of phage display a technology licensing organisation undertechnology to select antibody fragments the auspices of the University of Tokyo, havecapable of specifically recognising other entered into an exclusive agreement withmolecules with a screening method enabling FUJIFILM Corporation to commercialize andrapid identification of antibody fragments sub-license the invention.
  8. 8. aarhus university inventor’s guide 9INVENTION DISCLOSURESWhat is an Invention Disclosure? may solve a significant problem and/or haveAn Invention Disclosure is a description of your significant value. If you are in doubt, contactinvention or development that is provided to the TTO to discuss the potential invention.the TTO. The Invention Disclosure should alsolist all sponsors of the research and should When should I complete an Invention Dis-include any other information necessary to closure?begin pursuing protection and commerciali- You should complete an Invention Disclosurezation activities. It is critical that you note the whenever you feel you have discovered ordate of any upcoming publication or other developed something unique with possiblepublic disclosures describing the invention. commercial value. This should be done wellTo initiate the process, mail the Invention before presenting the invention throughDisclosure to our office. This document will be publications, poster sessions, conferences,treated as confidential within Aarhus University. press release, abstracts, or other communi-You will usually be contacted shortly after cations – Publicly disclosed inventions haveyour submission of the Invention Disclosure a minimal potential for patent protection inwith information on the evaluation process most countries.of your invention. How do I submit an Invention Disclosure?How do I know if my discovery is an inven- You can download a disclosure form andtion? Should I be submitting an Invention simple instructions from www.au.dk/invent. IfDisclosure? you have any questions, call our office at +45You are encouraged to submit an Invention 8942 6884 or e-mail us at pke@au.dk.Disclosure for all developments that you feel
  9. 9. aarhus university10 inventor’s guideRESEARCH CONSIDERATIONSAND MATERIAL TRANSFERAGREEMENTSWill I be able to publish the results of my the date and conditions of use so that weresearch and still protect the commercial can determine if this use may influencevalue of my intellectual property? the commercialization potential of yourYes, but since patent rights are affected subsequent research results. If you wish toby these activities, it is best to submit an obtain materials from outside collaborators,Invention Disclosure form well before any an incoming Material Transfer Agreementpublic communication or disclosure of the (MTA) should be completed. For moreinvention. information on MTA’s please contact the TTO.Once publicly disclosed (published orpresented in any form), an invention may Will I be able to share material, researchhave restricted or minimal potential for tools or intellectual property with others topatent protection except in the United States. further their research?Be sure to inform your contact at the TTO Yes. However, it is imperative to documentof any imminent or prior presentation, items that are to be shared with others and thelecture, poster, abstract, web site, description, conditions of use. If you wish to send materialsresearch proposal submission, dissertation/ to an outside collaborator, an outgoing MTAthesis, publication, or other public presenta- should be completed for this purpose. It maytion of the invention. also be necessary to have a Non-Disclosure Agreement completed to protect your researchMay I use material or intellectual property results or intellectual property. Please contactfrom others in my research? the TTO for more information.Yes, but it is important to document carefully
  10. 10. aarhus university inventor’s guide 11What rights does a research sponsor haveto any discoveries associated with myresearch?The Collaboration Agreement should specifythe rights of the sponsor regarding intellectualproperty. AU usually retains ownership ofthe patent rights and other intellectualproperty resulting from sponsored research.However the sponsor may have rights toobtain a license to the intellectual propertyarising from the research. Often sponsoredresearch contracts allow the sponsor a limitedtime to negotiate a license for any patentor intellectual property rights developed asa result of the research. Even so, the sponsorwill not have contractual rights to discoverieswhich are clearly outside of the scope of theresearch. Therefore, it is important to define thescope of work within a research agreementand the companies’ “Field of use”. For helpto draft and negotiate sponsored researchagreements please contact the TTO.
  11. 11. aarhus university12 inventor’s guideINDUSTRY AS THE NECESSARYINTERMEDIARYHow many cells are there normally in a liver greatest probability of containing interestingor brain? And how many cells are thereafter information. Depending on the specific taskthe use of medication, the influence of a the efficiency is increased by a magnitudetoxin or the onset of a specific disease such of 8 to 30. The technology was developedas cancer or Parkinson’s disease? These at the Stereology and Electron Microscopyare some of the questions that researchers, Research Laboratory under the Clinicalmedical practitioners and the pharmaceu- Institute by Professor Hans Jørgen Gundersen,tical industry would like to answer. However, Associate Professor Jens Nyengaard and thenthe amount of data from digital images that PhD student Jonathan Gardi.needs to be analysed is massive and the workis time consuming and highly specialised. ”For us it’s interesting to conduct scienceNow, with a new technology invented by that can be published in the best scientificAarhus University researchers, things are about journals. The collaboration with Visiopharmto get a whole lot easier. The technology has further allows our research to be incorporatedbeen licensed to the Danish company Visio in their software platform to the benefit ofpharm and will, together with the company’s scientific and technical development as wellown improvements to software and machi- as clinical work around the world,” says Jensnery, significantly reduce the time spent Nyengaard, Aarhus University. “We are theanalysing tissue samples. The result is “a necessary intermediary,” says CEO Michaeltechnical quantum leap,” says Visiopharm Grunkin and elaborates: “The researchersCEO Michael Grunkin. The patent pending invent methods for which there is a verytechnology known as the Proportionator high demand. What we sell is basically theworks by a propriety method of selecting the practical result of the knowledge generatedareas of tissue samples with the statistically by the researchers.” jens nyen jon atha n gardi gaard
  12. 12. aarhus university inventor’s guide 13OWNERSHIP OFINTELLECTUAL PROPERTYWhat is intellectual property? Where can I find more information?Intellectual property is an invention and/or For more information please go to www.material that may be protected under the au.dk/inventpatent, trademark and/or copyright laws. Should I list visiting scientists on my InventionWho owns what I create? Disclosure?Ownership depends on the employment All contributors to the ideas leading to a disco-status of the invention’s creators. Conside- very should be mentioned in your disclosure,rations include: even if they are not AU employees. The TTO• What is the source of the funds or resources will determine the rights of such persons andused to produce the invention? institutions. It is prudent to discuss with the TTO• What was the employment status of the all working relationships (preferably beforecreators at the time the intellectual property they begin) to understand the implicationswas made? for any subsequent inventions.• What are the terms of any agreementrelated to the creation of the intellectual Can a student contribute to an invention?property? Yes, a student can even be the sole contributor or inventor. As a ground rule ownership to anAccording to the Act on inventions at public invention (or ownership to an ideal share ofresearch institutions, any inventions made an invention) made by a student lies withby an employee as part of his or her work the student. Ownership may however lieat a university under the Danish Ministry elsewhere if the invention was created by aof Research and Information Technology student in a capacity as an AU employee orbelongs to the institution. If in doubt, it is best if the rights to his or her inventions have beento contact the TTO for advice. assigned as part of the conditions for joining a sponsored research project.
  13. 13. aarhus university14 inventor’s guidePATENTSWhat is a patent? instances, but only in its isolated form (sinceA patent gives the holder the right to exclude the isolated form had never been knownothers from making, using, selling, offering to before). A variation of a naturally occurringsell, and importing any patented invention. substance may be patentable if an inventor isNote, however, that a patent does not provide able to demonstrate substantial non-obviousthe holder any affirmative right to practise a modifications that offer significant advantagestechnology, since it may fall under a broader in using the variant.patent owned by others; instead, your patentonly excludes others from practising it. Patent What is the definition of an inventor on aclaims are the legal definition of an invention’s patent and who determines this?protectable invention. An inventor is a person who makes an original and substantive contribution to the conceptionWhat type of subject matter can be pa- of the ideas in the patent claims of a patenttented? application. An employer or person whoPatentable subject matter includes processes, furnishes money to build or practice anmachines, composition of matters, and invention is not an inventor, neither is a personmethods. who tests or reduces someone else’s idea into practice. Inventorship may require an intricateCan someone patent naturally occurring legal determination by the patent attorneysubstances? prosecuting the application.Not in its natural state. However, a natu-ral substance that has never before been Who is responsible for patenting?isolated or known may be patentable in some The TTO contracts with outside patent attorneys
  14. 14. aarhus university inventor’s guide 15for patent prosecution and maintenance, 14-16 months from the first filing. The searchthus assuring access to patent specialists in report lists all prior art documents found bydiverse technology areas. Inventors work with the Examiner and includes them as copies.the patent attorneys in drafting the patent More often than not, the Examiner rejects theapplications and responses to patent offices application because either certain formalitiesin countries where the patent is pending. need to be cleared up, or the claims are not patentable over the “prior art” (anything thatWhat is the patenting process? workers in the field have made or publiclyPatent applications are generally drafted disclosed in the past). The patent attorneyby an outside patent attorney. The patent files a written response by amending theattorney will ask you to review an application claims and/or pointing out why the Examiner’sbefore it is filed and will also ask you questions position is incorrect. This procedure is referredabout inventorship of the application claims. to as patent prosecution and it may takeAt the time an application is filed, the patent more than one correspondence between theattorney will ask the inventor(s) to sign an Examiner and the patent attorney. During theInventor’s Declaration and an Assignment prosecution process, input from the inventor(s)under which the inventor(s) assigns his or her is often needed to confirm the patent attor-rights in the patent to Aarhus University. This ney’s understanding of the technical aspectsis part of normal patenting procedures, and of the invention and/or prior art cited againstyour signing the document does not mean the application.that you relinquish the right to potentiallyreceive remuneration. Your application is published 18 months afterA search report is send from the patent office the filing date. Your invention will appear in
  15. 15. aarhus university16 inventor’s guidedatabases accessible to other people and it the patent office’s mandated maintenancewill act as prior art against any future patent fees are paid.applications. Will Aarhus University initiate or continueIs there such a thing as an international pa- patenting activity without an identified li-tent? censee?No, but an international agreement known Often Aarhus University accepts the risk ofas the Patent Cooperation Treaty (PCT) pro- filing a patent application before a licenseevides a streamlined filing procedure for most has been identified. After the university’s rightsindustrialized nations. A PCT application is have been licensed to a licensee, the licenseegenerally filed one year after the corresponding generally assumes the patent expenses. Atfirst national patent application has been times the university must decline further pa-submitted. The PCT application must later tent prosecution after a reasonable period ofbe filed in the national patent office of any attempting to identify a licensee.country in which the applicant wishes to seekpatent protection, generally within 30 months Where can I get more information on patentsof the earliest claimed filing date. and the patenting process? You’re welcome to contact the TTO staff ifWhat is the timeline of the patenting process you have any questions regarding the patentand resulting protection? protection of your invention. For generalThe average patent application is pending for information see more at the web site for theabout 4 years, though inventors in the biotech European Patent Office www.epo.org or thefields should plan on a longer waiting period. Danish Patent and Trademark Office www.Once a patent is issued, it is enforceable for dkpto.org. The US has to some extend different20 years from the initial filing of the appli- rules for the patent prosecution, see more atcation that resulted in the patent, assuming www.uspto.org.
  16. 16. aarhus university inventor’s guide 17 Jørgen KjemsCOLLABORATION KEY TO COMMERCIALIZINGNEXT-GENERATION PERSONALIZED MEDICINEJust as researchers from different institutions Denmark. They have worked in the rapidlycollaborate to generate new knowledge growing field of personalized medicine toand drive research forward, so have the develop a novel technology based on geneadministrative offices servicing the researchers therapy. “Rarely, there is one or two researchersbecome used to working with other universities behind a patent in this field. Today, almostto commercialize the results of jointly all research is done in larger networks,” saysmade research. Similarly, more and more Professor Jørgen Kjems.technologies are developed jointly by AarhusUniversity researchers and their colleagues The technology was commercialized jointlyin the private industry. Each year a dozen by Aarhus University and Science Venturesinventions made by Aarhus University staff Denmark, a wholly-owned subsidy of thethrough research collaborations are handled University of Southern Denmark and wasby the TTO. sold to the Danish biotech company Santaris Pharma in 2007. Besides the potential revenueOne such collaboration has been the pione- flowing back from the company if a drug isering work done by Professor Jørgen Kjems ever marketed, Professor Jørgen Kjems seesat the Department of Molecular Biology another benefit: “Santaris is paying for moreand iNANO, Aarhus University and Professor research at the university, which enables usJesper Wengel, Department of Physics and to keep developing the invention“.Chemistry at the University of Southern
  17. 17. aarhus university18 inventor’s guideCOMMERCIALIZATIONWhat are the typically steps in a commer- Your active involvement can significantlycialization process? improve the chances of matching anUsually a patent application is filed before invention to an outside company. Yourany marketing of the technology takes place. research and consulting relationships areOften a period of maturing or validating the often helpful in both identifying potentialinvention will take place prior to or simulta- licensees and technology champions withinneously with any marketing of the invention. companies. Former students and colleaguesOnce a licensee is found, the TTO negotiates are also a good source for leads. Once inte-an agreement for the use of the invention rested companies are identified, the inventorand subsequently monitors the agreement is the best person to describe the details ofon behalf of the university. the invention and its technical advantages. The most successful technology transferHow does the TTO market my inventions? results are obtained when the inventor andThe TTO uses many sources and strategies the licensing professional work together asto identify potential licensees and market a team to market and promote use of theinventions. Sometimes existing relationships of invention.the inventors, the TTO, and other researchersare useful in marketing an invention. Various How long does it take to find a potential licen-types of market research can also assist in see and negotiate a license agreement?identifying prospective companies. It can take anywhere from a phone call to years to locate the right licensee. This usuallyHow can I assist in marketing my inven- depends on the attractiveness of the inven-tion? tion and the size and stage of development
  18. 18. aarhus university inventor’s guide 19of the market. Most inventions from Aarhus What is a start-up and why choose to createUniversity tend to be in the early stages of one?development and thus often require further A start-up is a new business entity formed todevelopment and validation along with a sub- commercialize one or more related intellec-stantial commercialization effort to licensees tual properties. Forming a start-up businesswho understand the nature and risk of tech- is an alternative to licensing the invention tonologies from basic research institutions. an existing company. A few key factors when considering a start-up company are:What is a license agreement? - Development risk. Large companies inA license is permission granted by the owner established industries are often unwilling toof intellectual property that allows another take the risk on an unproven technology.party to act under all or some of the owner’s - Development costs versus investment return.rights, usually under a written license - Can the investors in the start-up obtain theiragreement. needed rates of returnLicense agreements typically describe the - Potential for multiple products or servicesrights and responsibilities related to the use from the same platform technology. Fewand exploitation of intellectual property. companies survive on one product aloneLicense agreements from the university - Sufficiently large competitive advantageusually stipulate that the licensee must dili- and target marketgently seek to bring the university intellectual - Potential revenues sufficient to sustain andproperty into commercial use for the public grow a company.good. The agreement also seeks to provide areasonable return to Aarhus University.
  19. 19. aarhus university20 inventor’s guideWho decides whether to form a start-up? According to Aarhus University policy, a shareThe choice to establish a new company for of any surplus financial return from a license iscommercializing intellectual property is a provided to the inventor(s) and to the inventor’sjoint decision made by the TTO and the in- research group through the department. Forventors. If a new business start-up is chosen more information, see www..au.dk/invent.as the preferred commercialization path, theTTO assists you and the other founders in In addition, inventors enjoy the satisfaction ofmeeting investors, consultants, and entrepre- knowing their inventions are being deployedneurs to help you in founding the company. for the benefit of the general public. New andThough, you must always provide some sort of enhanced relationships with businesses arebusiness plan for the start-up company. another outcome that can augment one’sWhen the start-up is established the TTO will teaching, research and consulting.negotiate with a representative of thecompany to grant a license to the new What is the relationship between an inventorcompany. It is wise for inventors to have and a licensee, and how much of my timeagreements regarding their roles with the will it require?start-up reviewed by their own counsel to Most licensees need some active assistanceensure that all personal ramifications — by the inventor to facilitate the productincluding taxation and liabilities — are clearly development of their invention. This can rangeunderstood. from infrequent, informal contacts to a more formal consulting relationship. Working with aWhat can I expect to gain if my IP is licen- new business start-up can require substantiallysed? more time, depending on your role in or with
  20. 20. aarhus university inventor’s guide 21the company and your continuing role within What will happen to my invention if the start-Aarhus University. up company or licensee is unsuccessful? Can the invention be licensed to anotherWhat revenues are generated for Aarhus Uni- entity?versity if commercialization is successful? Licenses typically include performance mile-Most licenses have licensing fees that can be stones that, if unmet, can result in termination.very modest (for start-ups or situations in which This allows for subsequent licensing to anotherthe value of the license is deemed to warrant business. However, time delays and othera modest license fee) or can reach sums many considerations can hinder this re-licensing.times that. Royalties on the eventual sales of If the TTO is unsuccessful at commercializingthe licensed products can generate similar or your invention, the rights associated with it willgreater revenues, although this usually takes be offered to you and any other inventors oryears to occur. Equity, if included in a license, assignees in return for a fair remuneration, ifcan yield similar returns, but only if a successful the invention is ultimately commercialized.equity liquidation event (public equity offeringor a sale of the company) occurs. Mostlicenses do not yield substantial revenues.A recent study of licenses at U.S. universitiesdemonstrated that only 1% of all licenses yieldmore than 1 million dollars. However, therewards of an invention reaching the marketare often more significant than the financialconsiderations to the university alone.
  21. 21. aarhus university22 inventor’s guideREVENUE DISTRIBUTIONHow are license revenues distributed? to the inventor if a patent application is sub-The TTO is responsible for managing the ex- mitted as a PCT application or similar at thepenses and revenues associated with tech- end of the priority year. This is because Aarhusnology agreements, e.g. license agreements. University solely submits the PCT applicationsPer Aarhus University Policy, revenues from or similar when – based on a commerciallicences fees, royalties and equity – minus any assessment – the commercial exploitation ofun-reimbursed patenting and commerciali- the invention is expected to produce a netzation expenses – are shared with one third income. This one-off payment is subsequentlyto the inventors, one third to the department deducted from any later remuneration towhere the inventor was employed at the time the inventor.when the invention was reported and onethird to the TTO. See “Rules and regulations for What are the tax implications of anycalculating remuneration in connection with revenues I receive from Aarhus University?commercial exploitation of inventions made, License revenues, including one-off payments,produced or developed during employment to inventors are generally taxable and areat Aarhus University”, which can be found at reported as income. Consult a tax advisorwww.au.dk/en/67-01.htm. for specific advice.When do I receive the revenues? How are inventor revenues distributed if thereWhen the rights to an invention are assigned are multiple inventors and/or multiple inven-to Aarhus University for commercial exploita- tions in a licence?tion subsequently results in net income, Aar- The “inventor’s share” of royalties is dividedhus University pays the inventor a reasonable among all inventors according to their intel-remuneration as described above. However, lectual contribution to the invention.a one-off payment of DKK 30,000 is made
  22. 22. aarhus university inventor’s guide 23COMMERCIALIZING A DIAGNOSTIC TECHNOLOGYGAVE ADDED BENEFITS TO RESEARCHERSAccurate and fast methods of diagnosis at first, but then you find out how much ishave a great importance in the treatment needed for development by the investorsof cancer. Associate Professor Jørgen Koch to turn research into reality” says Jakobhas been researching novel methods for use Lohmann and explains. “For me, the importantin diagnosis for more than 20 years. In 2004 thing has been to take part in board meetingshe started working with then PhD students and business negotiations in order to get anMagnus Stougaard and Jakob Lohmann insight into a world that I knew nothing about.to develop this research into specific work At the same time, it is amazing to see yourmethods and diagnostic technologies. “I think research be put to use”.it is important that the science gets out thereand is made useful,” says Jørn Koch. jakob loToday, doctors and medical staff have toexamine thousands of cells at once if, for hmanninstance, they are looking for signs of cancer.The new method takes much smaller samplesby rolling a RNA string around the cell andthen scales the sample up to a size whereit can be examined and changes can bespotted right away showing the results ofchemotherapy after days instead of weeksor months.In 2006, the spinout company In Situ RCPwas formed by the inventors and NOVIInnovation to commercialise the technology.The fact that the university owns the intel-lectual property rights covering some of thetechnology has not been a problem for JakobLohmann. Inventors are always entitled to ashare of the university’s income. “You shouldn’tbe doing this for the money, but in order tolearn something and get more focused inyour work. Of course I dreamt about money
  23. 23. aarhus university24 inventor’s guideAarhus university Phone: +45 8942 6884Technology Transfer Office Facsimile: +45 8613 5910Finlandsgade 29 Web: www.au.dk/pke8200 Aarhus N, Denmark and: www.au.dk/invent

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