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TTOs eliminate barriers, expedite the licensing process for start-ups


By Jesse Schwartz
Published: February 21st, 2018

With a few years of experience with various types of streamlined licensing procedures, most experts say it is still unclear what overall impact they have had on the creation of university start-ups or their overall return-on-investment. However, debate still rages over just how streamlined such licensing processes should be. Some university TTOs remain firmly behind their traditional approach to negotiating each deal on a case-by-case basis while others aim to expand their use of one-size-fits-all templates.

In between these two perspectives is a middle ground where most TTOs are finding their way. In some cases, they’re saying goodbye to up-front revenue in exchange for an uptick in activity, and in others they’re making a bet that the long-term gains will be far greater if they facilitate more entrepreneurial activity on the front end. Beyond these perspectives, there are practical steps that virtually any TTO can take to expedite deals.

Certainly, increasing deal-flow was one of the essential, motivating factors behind the “quick start” licensing initiative, launched in 2015 at Washington University in St. Louis (WUSTL), a bastion of biomedical research in St. Louis, MO. However, the Office of Technology Management (OTM) was also focused on making it easier for start-up companies to achieve lift-off.

“We came up with a draft version that was then vetted through outside community partners, venture firms that we worked with, licensing partners we worked with and contract attorneys in the St. Louis region,” explains Leena Prabhu, associate director of the OTM. “Once we did that, we came up with what you see now on our website: a backend-loaded agreement with clear terms that are deemed reasonable and fair to a start-up entity. (Click here.)

While the quick start, ready-to-use approach is only available to WUSTL employees, it offers an exclusive license with the right to sublicense in exchange for very attractive financial terms. There are no up-front fees, no annual fees and no milestone fees. Further — and this is big — start-ups do not need to repay past patent costs, although they are responsible for future patent expenses. The university asks for a fixed 2% patent royalty rate on the sales of any produces and a 0.95% success fee upon an exit event; however WUSTL takes no equity position in the company. In addition, there is a sliding royalty for sublicensing starting at 15% and decreasing to 5% over five years.

“It is for WUSTL inventors who are also cofounders of the companies and want a license from the university,” notes Prabhu. “The technology has to be solely owned by the university, so it cannot be a jointly-owned technology with another university.”

Prabhu says the quick start process was designed with therapeutics in mind, but it can be used as a template for other assets as well. “In the future we are going to be giving some thought to [developing] a quick start approach for other assets,” she says. “It could be for a software asset or a diagnostic asset where the terms and considerations may be a bit different depending on the stage of the technology and the type of asset, but for now it is a one-size-fits-all.”

Given the goals of the quick start approach, it has certainly delivered. Prabhu notes that the number of start-ups spun out of the university has doubled from four to eight per year since the streamlined license was implemented, but it has also presented challenges. For instance, while the quick start process is only available to WUSTL inventors, the approach has exerted downward pressure on the financial considerations for all the other OTM deals. “The other entities look at the quick start license and want the same terms from the university,” observes Prabhu.

A detailed article on express licensing programs appears in the February issue of Technology Transfer Tactics. To subscribe and get the full article, plus access the publication’s entire 10+ year archive of best practices and success strategies for TTOs, CLICK HERE.

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MIT and Tsinghua University launch program to help start-ups solve challenges in Chinese cities


By Jesse Schwartz
Published: February 21st, 2018

The Massachusetts Institute of Technology (MIT) and Tsinghua University are partnering to help their start-ups solve urban challenges in China. continue reading »

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Webinar next week: Drafting and Negotiating Master Research Agreements


By Jesse Schwartz
Published: February 21st, 2018

As corporate interest in partnering with universities rises, so does the need for high-quality master research agreements (MRAs). While they can save time and smooth the path to deeper industry-university partnerships, negotiating an MRA is no easy task. It is a thorough and deliberate process and you must address terms and conditions that are — and will be — applicable to each project over time, while also providing wiggle room for project-specific issues to be addressed later. This is made even more difficult when projects are ongoing and outcomes are unknown.

The goal is a win-win agreement with your corporate partner/sponsor. So how do you draft an MRA that suits the needs of both parties? Register today for this eye-opening webinar led by global R&D advisor and attorney James Casey: Drafting and Negotiating Master Research Agreements. This strategy-filled, detailed program will leave you with a greater understanding of the purpose of MRAs and best practices for solidly written agreements that will stand the test of time.

For complete details and to register, CLICK HERE.

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Harrisburg University professor launches start-up that makes data intelligent


By Jesse Schwartz
Published: February 21st, 2018

A professor at Harrisburg University of Science and Technology (HU) has developed a way to make data intelligent so that it can process and send itself where it needs to go. continue reading »

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Tel Aviv U researcher partners with TheraCann to help track and regulate legal cannabis products


By Jesse Schwartz
Published: February 21st, 2018

A researcher at Tel Aviv University in Israel is helping to commercialize a technology that tracks the authenticity and safety of products in the legal cannabis industry. continue reading »

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Royalty Rate Benchmarking Guide, 2017/2018 Global Edition


By Jesse Schwartz
Published: February 21st, 2018

In the 100+ pages of the Royalty Rate Benchmarking Guide, 2017-2018 Global Edition, you’ll get a comprehensive, up-to-date look at royalty rates and rate trends for more than 20 industries.

This new edition includes three times more analyzed agreements than the previous edition. Royalty rate data are efficiently organized by industry so you can quickly canvass the IP landscape and get the information you need, and individual summary agreements from actual deals are included for each industry. You’ll receive:

  • Royalty rate medians, averages and interquartile ranges
  • Royalty rate ranges by deal type
  • Royalty rate ranges by agreement type (marketing intangibles, patent/technology intangibles, and combination intangibles)
  • Percent of agreements made by region (Asia Pacific, Europe, North America, South America, Africa, and Worldwide)
  • General trends in licensing agreements by industry sector, plus observations on the most popular types of license agreements made by industry
  • Royalty rate trends over the past 10 years

The critical real-world data and analysis in this one-of-a-kind resource – available for just $299 – will help you assess fair value and ensure you receive optimum pricing for your intellectual property.

For complete details and to order, CLICK HERE >>

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U of British Columbia spinout gets approval to launch phase II trials for anti-scarring treatment


By Jesse Schwartz
Published: February 21st, 2018

A University of British Columbia (UBC) spinout has been cleared to launch a phase II clinical trial of its groundbreaking anti-scarring treatment. continue reading »

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U of Maryland researchers discover way to make wood stronger than steel


By Jesse Schwartz
Published: February 21st, 2018

Researchers at the University of Maryland (UMD) in College Park are developing a way to make wood more than 10 times stronger than titanium alloys. continue reading »

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Johns Hopkins APL licenses tool that helps train dogs in explosives detection


By Jesse Schwartz
Published: February 21st, 2018

Johns Hopkins University Applied Physics Laboratory has developed and licensed a tool for training canine teams to detect peroxide-based homemade explosives. continue reading »

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Comings and goings


By Jesse Schwartz
Published: February 21st, 2018

Naval Undersea Warfare Center (NUWC) Division Newport has selected tech transfer professional Mary Sylvia to serve as technology partnership officer in the Technology Partnerships Office (TPO). In her new role, Sylvia will be the senior advisor to NUWC Newport’s chief technology officer Vittorio Rotti on matters relating to strategic industry collaborations and tech-related business decisions. As head of TPO, she will help identify current and emerging technologies available from external sources that could enhance the Division’s current portfolio. Sylvia will also lead the effort to develop infrastructure to improve the Division’s sharing and licensing of intellectual property.

Sylvia most recently served as director of strategy implementation for the Undersea Warfare Weapons, Vehicles and Defensive Systems Department and as director of the Division’s Advanced Naval Technology Exercise for 2018. Prior to that, she worked as manager of the Division’s Strategic Management Information Center, as an internal communications coordinator and as the tech transfer coordinator in the former Technology Partnership Enterprise Office.

Source: dvids

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‘Founders Pie Calculator’ offers a more nuanced way to determine equity shares


By Jesse Schwartz
Published: February 14th, 2018

So you’re getting a start-up going, and it’s time to divvy up the equity shares among the four partners. The most logical thing to do is to award 25% to each of the partners, right?

Wrong, says Frank Demmler, adjunct teaching professor of entrepreneurship, Donald H. Jones Center for Entrepreneurial Studies at the Tepper School of Business at Carnegie Mellon University.

“I’ve been doing what I’m doing since 1984,” he says. “More than 50% of the time people have done the [equity] division equally, and I’ve seen how flawed that was and how detrimental it was to the company at critical times.”

The reality, he underscores, is that not all partners contribute or participate equally. For example, one worker may work from 7:00 a.m. to 7:00 p.m., while another might saunter in at 10:00 and leave at 3:00. Or, you may quit your job and have no salary, while the other partners keep theirs and offer funds until the company can pay them. One partner may want to raise investment funds, while the others want to avoid the risk.

Beyond that, Demmler points out, some partners may simply bring more to the table than others. Accordingly, he has come up with a number of questions the partners should ask themselves, such as:

  • Who did what to come up with the business idea?
  • Who contributed what in conceiving the business model?
  • Who has the industry connections?
  • Who is joining the company full-time?
  • Who is responsible for bringing the product to market?

These and other essential questions were woven by Demmler into a tool he calls the “Founders Pie Calculator.” It works like this: First, several variables are given a “weight,” or an evaluation, from 0-10. These variables are: Idea, Business Model, Domain Expertise, Commitment & Risk, and Responsibilities.

The weights can be compared to each other in addition, to make sure their relative values make sense.

Each of the founders can then also be rated in each of these areas. The numbers are entered into respective matrices. Then each of the Founders’ points are added up, and calculated as a percentage of the total points, indicating a recommendation for an appropriate percentage of ownership.

A detailed article with examples appears in the January issue of Technology Transfer Tactics. To subscribe and get the full article, as well as the publication’s 10-year online archive of success strategies and best practices for TTOs, CLICK HERE.

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U of Nebraska Medical Center researchers are working on a potential cure for HIV


By Jesse Schwartz
Published: February 14th, 2018

Researchers at the University of Nebraska Medical Center (UNMC) have altered an existing HIV drug to help it reach more cells and tissues where the virus can be found. continue reading »

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