Most university TTOs license a sizable percentage of their early-stage technologies to small companies, so dealing with cash-strapped licensees isn’t a new phenomenon, says Daniel Burns, president of Daniel Burns & Associates, Inc., in San Francisco. However, the U.S. economy’s recent nosedive into a hard recession has definitely exacerbated the problem, he stresses. A case in point: In the last quarter of 2008, North Carolina State University “noticed a significant increase in the number of licensees that materially breached their contracts,” points out Billy B. Houghteling, director of NC State’s TTO. “These breaches relate not only to the payment of fees associated with commercialization, such as minimum annual royalties and license fees, but also to the reimbursement of patent expenses.” With no signs of an immediate economic turnaround on the horizon, “the extent of the payment breaches will probably expand in 2009,” predicts Houghteling. Burns agrees. “The prospects for raising cash right now are really pretty poor,” he explains. “Liquidity issues are going to affect companies along the spectrum from those that are small and privately-held to large public companies.” Given this gloomy scenario, the cover story in the February issue of Technology Transfer Tactics reports a bevy expert suggestions and practical steps TTOs can take to prepare for — and deal effectively with — a burgeoning number of overdue payments from licensees and other industry partners. For subscription information, CLICK HERE.

Posted February 11th, 2009 under Tech Transfer

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