Technology-Transfer-Quiz.

1. FACT OR FICTION
“Top-Ten” Quiz About Tech Transfer

2. 2
No Right Answers
No Clear Answers
 Confession: There are no real answers to
many of the questions we’ll talk about today.
 Tech Transfer isn’t a profit-driven enterprise.
 Neither is Tech Transfer only an
academic/research-driven process.
 It lives between two worlds, and that creates
ambiguity and some confusion.

3. 3
Quiz Question 1
 What is the objective of technology transfer?
A) Facilitate commercialization of university
discoveries.
B) Reward, retain and recruit faculty researchers.
C) Forge closer ties with industry.
D) Promote economic growth for our community.
E) Generate income.

4. 4
Answer to Question 1
 All objectives apply but . . .
• Multi-faceted.
• Can create tension with each other.
• Can create conflicts with other University missions, e.g.:
 freedom to publish vs company sponsored research
confidentiality; maximizing income vs industry relationships.

5. 5
Quiz Question 2
 True or False: Technology Transfer is a
barrier to dissemination of information and
stifles free flow of ideas.

6. 6
Before we get to the answer:
 Quiz Question 3:
• True or False: There is no downside to the University
other than lost royalty revenue if we just publish and
not patent.

7. 7
Answer to Question 3
 False – in some ways
• Patenting protects our right to continue to research.
 First-to-file rule exists outside US and may be coming to the
US soon.
 Despite common misconception, there is no “experimental
use” right to practice someone else’s patent.
• Patenting makes the technology more marketable –
companies are more inclined to spend R&D dollars if
patent protection exists. That’s because . . .

8. 8
Answer to Question 3 (continued)
 Patents list prior art and state claims that can be
used commercially – easier to see commercial
advantages through this than through a scientific
publication.
 If inventions funded with Federal grant money,
Bayh-Dole requires that University inform
funding agency and give them notice of
University’s intent to take title (or not).

9. 9
Return to Quiz Question 2
 True or False: Technology Transfer is a
barrier to dissemination of information and
stifles free flow of ideas.

10. 10
Answer to Question 2
 Rarely . . . and only when a particular
technology is changing very fast:
• Patenting is necessary and a good thing to get our
research results used commercially.
• Publication without patenting will cause some
companies to commercialize our technology and keep
all the economic benefit of our work.
• Patenting and licensing are separate from publication
process. It’s fine to publish – just need to get a US
provisional application filed first.

11. 11
Answer to Question 2
 BUT . . . there may be times when we choose to
patent technology and the proprietary nature of a
patent will ruin its commercial application.
 Primary example is certain software – where
patent prosecution timelines are too long for how
fast the field is changing . . . better to allow
everyone to use as open source.

12. 12
Quiz Question 4
 The average length of time inside a
university from invention disclosure to
licensing of a patent is:
A) 2-4 years.
B) 4-6 years.
C) 6-10 years.
D) 10+ years.

13. 13
Answer to Question 4
 6-10 years. Physical science technologies are on
the lower end of the range and life sciences are on
the upper end.
 If the question were the length of time from
invention disclosure to the first dollar of royalty
revenue, the answer would be 10+ years.
 Technology transfer process takes time.

14. 14
Quiz Question 5
 Marketing technologies is best done by
A) Inventor leads.
B) Waiting for a company to call.
C) Publishing a list of our available technologies
(many web-based sites).
D) Tailored marketing (“cold calls”) for each
technology.
E) Booths at conferences and trade shows.

15. 15
Answer to Question 5
 It depends.
 All of these have proven successful to license
technologies. These marketing “methods” are
listed from highest frequency of success to lowest,
based on available research.
 So the contacts that researchers have with their
industry colleagues are the best way to get interest
for a license.

16. 16
Quiz Question 6
 Royalty rates in university licensing are
based on:
A) The value of the IP and strength of the patent
claims.
B) The investment required to get the technology
into a product and onto the market.
C) The time it will take to get to market.
D) How much other IP needs to be incorporated
into the product.

17. 17
Answer to Question 6
 All of the above.
• Negotiating a royalty rate for our technology is a
complicated process.
• This is where our not-for-profit mission helps us . . . we
are not “all about the money” so, unlike industry, we
will not let a licensing opportunity pass because we
must make a certain profit on the technology.

18. 18
Answer to Question 6 (continued)
 So how do we initially set royalty rates?
• Tech transfer offices have gotten better at this over the
past decade due to better available data.
• At UR, we have access to databases that give royalty
rates for comparable licenses that help us benchmark.
• Challenge still remains because our technologies are
often so early-stage that no similar benchmark exists.

19. 19
Quiz Question 7
 True or False: The University makes a lot
of money in royalty revenues.

20. 20
Answer to Question 7
 It depends.
• UR has been in the top 10 institutions in the country in
total royalty revenues.
• The biggest piece of royalty revenue is returned to
inventors. Then departments, their schools, and the IP
Pool divide the rest, so no one place sees large
revenues.
• Still, royalty revenue is among the most valuable that
can be brought into a University because it falls right to
the bottom line.

21. 21
Correction:
 In the original presentation, Dr. Kuncl refers to the
information in the next slide as the top ten royalty
revenue earners for 2005 – 2007 (approximately
23:30 of the video). The actual slide shows 17
institutions (16 + the University of Rochester) that
had been chosen for a previous benchmarking
exercise. We apologize for any apparent
misrepresentation.

22. 22
Return on Research Investment
University FY 2005-2007
Research Expenditure
FY 2005-2007
License Income
% Income of
Research Dollars
Emory [Emtriva monetization
$540M] 1,076,735,918 621,128,963 57.686%
U of R 1,053,840,381 121,823,590 11.560%
MIT 3,562,600,000 144,924,482 4.068%
U Colorado 1,768,135,784 71,283,684 4.032%
Wash U. 2,793,192,603 101,487,126 3.633%
Case Western 917,600,574 30,362,986 3.309%
Harvard 1,877,429,996 61,240,241 3.262%
U. Chicago 1,068,059,726 30,824,111 2.886%
Carnegie Mellon 699,712,000 16,853,903 2.409%
Vanderbilt 1,163,544,184 22,215,206 1.909%
Dartmouth 543,731,416 6,704,873 1.233%
Penn 1,971,007,454 21,917,444 1.112%
Pitt 1,824,279,000 19,432,359 1.065%
Cornell 1,826,043,200 15,285,000 0.837%
Johns Hopkins 4,532,076,512 36,569,157 0.807%
Duke 1,803,537,206 14,552,013 0.807%
USC 1,278,000,000 7,107,915 0.556%

23. 23
Quiz Question 8
 Two parts
• What percentage of the University’s issued patents are
licensed?
A) 20-30%
B) 30-40%
C) 40-50%
D) Above 50%
• How does this compare to percentage of patents held by
companies that are used in products?
 Worse? Better? About the Same?

24. 24
Answer to Question 8
 The University has licensed about 36% of our
issued patents. This compares favorably to the
average for companies in the for-profit world (at
about 33%).
• Needs to be slightly corrected for the fact that
companies patent defensively.
• No one has a crystal ball to know for sure what
technologies will turn into products . . . let alone gold
mines.

25. 25
Quiz Question 9
 The biggest impediment to forming a start-
up company with University of Rochester
technology is:
A) Available financing.
B) Entrepreneurial talent.
C) Lack of available technology that is quick to
market.
D) Lack of support inside the University.

26. 26
Answer to Question 9
 A and B. (I hope no one thinks D).
 Major impediment seems to be available funds to
get the start-up off the ground.
 Starting a business is a hard thing. Published
literature says that only 3-5% of all companies
formed in the USA succeed (obviously, depends
on how you define success).

27. 27
Answer to Question 9 (continued)
 We have improved our licensing terms to start-ups
so that almost no cash needs to be paid under a
license until there is revenue.
• Exception for patent legal costs since we are out-of-
pocket for those.
• We will allow patent costs to be paid over time.
 We will continue to work with our community
partners such as HTR and Excel to try to improve
entrepreneurial talent and financing sources.

28. 28
Caveat
 We offer fair licensing terms but . . .
 Tax laws (on not-for-profit institutions)
restrict the terms any private university can
offer to start-ups.
• Prohibition on private inurement means we can’t appear
to give preferentially favorable terms to one company
over another.
• We can’t use our not-for-profit tax status to advantage a
for-profit company (e.g., use of space must be at fair
market value).

29. 29
Quiz Question 10
 True or False: Licensing an invention
creates a conflict of interest for the inventor.
 True or False: Forming a start-up if you are
an inventor creates a conflict of interest.
 True or False: Conflicts of interest are bad
things that can adversely affect the
perception of your research by others.

30. 30
Answer to Question 10
 If you do research for the company who licensed your
technology, then being an inventor on a licensed
patent creates a potential conflict of interest.
• Possibility of receiving royalties may be viewed as
influencing research.
 Owning equity in a start-up who has licensed your
technology is a potential conflict of interest.
• You are investing in your own technology.

31. 31
Answer to Question 10 (continued)
 Conflicts of interest are NOT bad things.
• Are often an inevitable consequence of
commercializing research results.
• Conflicts are OK – but they need to be
 Disclosed – that alone would have solved a lot of the recent
scandals.
 Managed – level of management effort depends on seriousness
of the conflict (e.g., significant financial conflict when human
subject research is involved).

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Are there any Quiz Questions for us?