Industry-Sponsored Research Week
University-Industry Engagement Advisor

UT Dallas’ contracting model attracts industry partners with IP-friendly terms


By David Schwartz
Published: October 12th, 2021

A detailed article on UT Dallas’ “IPA-SRA” industry contracting model appears in the October issue of University-Industry Engagement Advisor. For subscription information, click here. 

An industry-friendly model developed at the University of Texas-Dallas that enables corporate sponsors to obtain IP rights was recently implemented for the ninth time in two years, as Dallas-based SOTECH Health licensed platform technology developed by Shalini Prasad, PhD, department head and professor of bioengineering in the Erik Jonsson School of Engineering and Computer Science.

The invention developed by SOTECH, a breath analyzer that produces COVID-19 test results in less than 30 seconds, has already been submitted to the Food and Drug Administration for emergency use authorization.

Interestingly, SOTECH and Prasad were also the key players in the very first use of this contracting model, called “IPA/SRA,” and Prasad has become one of its leading proponents — having participated in three such agreements. “I’ve been at UT Dallas over 10 years and at other R1 and R2 institutions, and in general how we engaged with corporate partners was pretty much the licensing model — the faculty researcher would come up with an idea, do a disclosure, and the university would decide whether to patent or not,” Prasad shares.

After the IP was patented and assigned to the university, potential licensees — even corporate sponsors of the research involved — faced a cost barrier for exclusive licenses, particularly for broad patents with multiple fields of use, including up fronts and annual fees along with royalties. The university, Prasad explains, was looking to be more business friendly, and the new model accomplishes that goal.

The model — which assigns IP arising from industry-sponsored research back to the company — “was really driven by our industry sponsors,” says Brent Schultze, the university’s senior director of technology commercialization. “They are interested in securing the rights to the IP they pay to have developed, and many have the mentality of working with Contract Research Organizations; some may not be as experienced in working with universities. Obviously, universities have unique skills that CROs don’t have, but when industry works with a university they feel, ‘I had to pay for the research, and they want more?’ That’s the standard model in academia, but it’s getting some pushback.”

In 2016, he recalls, a representative of the university’s office of general counsel authored a presentation on different types of creative sponsored research models, which prompted a UT Dallas team to review several different models across the country. “Ours is based on the Penn State model,” says Schultze. “There were a lot of different ones, some that were overly complex and confusing. We wanted to keep it to a simple, easy solution to streamline engagement with industry.”

For example, he explains, several other models have some sort of upfront fee, such as 25% of research project costs. “Ours has none,” he points out. In the end, says Schultze, “the university’s standard sponsored research agreement template is 32 pages; the IPA/SRA is three.”

“We’re a young university; we’re now 51 years old,” notes Joseph Pancrazio, PhD, vice president for research and professor of bioengineering, who arrived at the university just as the new model was coming online. “The idea was that we could think beyond the conventional academic-industry agreement model. It would have been very easy to keep saying ‘No, this is how we do business.’ But we have this very interesting history; we came from Texas Instruments, so we have a certain amount of kinship with industry.”

When the new model was introduced, he recalls, “it was very, very well received — especially by industry advisory boards from the various schools. It was heralded as a transformation of how the university does business with industry.”

At the same time, he adds, “we had a null hypothesis; let’s see how the data looks. Ultimately, it takes two to tango. We do not force the model on a faculty member; it has to be something they and the team want to do, and something the industry partner is capable of doing and wants to do.”

As Prasad notes, the model is not restricted to start-ups. “We can do it with any company, provided their legal framework allows for it,” she says. “Very well-established companies [will notice] there is a bonanza clause,” which provides a 1% royalty to UT Dallas for any sales above the $20 million threshold — assuring the university doesn’t lose out completely on potential blockbuster technologies.

One key restriction, notes Schultze, is that “you can’t have any federal or other adjacent funding.”

The very first IPA/SRA agreement was signed in April 2019. “We were very cautious; in the pilot phase, we did not advertise much, but we made other researchers aware when they came to us and we educated them,” says Schultze. “Now, any time we engage with researchers we educate them on this being a possibility in the future.”

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Posted under: University-Industry Engagement Week

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