With so much interest and attention focused on express licensing vehicles, it was perhaps just a matter of time before the approach was applied to IP arising from sponsored research agreements. Now, Binghamton University in Binghamton, NY, has done exactly that with an instrument that it hopes will greatly streamline the sponsored research negotiating process while also establishing standards and predictability for its industry partners.

While university administrators were certainly aware of the express licensing agreements unveiled at the University of North Carolina, the University of Hawaii, the University of Maryland, and other institutions, the only thing they borrowed from these other instruments was the express concept, explains Eugene Krentsel, Binghamton’s assistant vice president for entrepreneurship and innovation partnerships. “Those are strictly licensing deals. Ours is targeted at a different stage of negotiations, at the time when we negotiate a sponsored research agreement,” he says. Consequently, the structure, purpose and clauses are all aimed at a different demographic.

“We have about 18% of our external sponsored research coming from industry,” says Krentsel. “And we were struggling, just like everyone else, to find a way to limit inefficiencies in the negotiation process, especially in the early stages.” Among the principal hang-ups were all the IP-related clauses that are necessarily part of the process. “As our office plays a major role in helping to negotiate these clauses in sponsored research agreements, we were brought in every time, again and again, and the negotiation was something that took a very long time,” he explains. “However, at the end of the day, it was not necessarily a good investment of that time.”

To get around these problems, the university developed what it is calling the Binghamton Express Square Terms or BEST Deal License, a nonexclusive, royalty-free license on patentable innovations that arise from sponsored research. “Structurally, the BEST becomes an exhibit to the research agreement, so it is designed as a seek-and-obtain style license, with the company sponsor having the option that it can exercise,” explains Scott Hancock, the director of IP management at the university. “We are looking at a very modest licensing fee and then we are looking to recover our patent costs.”

Only the company sponsoring the research is entitled to the BEST license, explains Krentsel, noting that this is in exchange for actually validating the technology and proving its commercial value. “It actually increases the value of the license for anybody else,” he says. “If another company wants to come in and get a NERF [non-exclusive, royaltyfree license], yes they can do that, but it will cost them more money. We are guaranteeing this [to the sponsoring company].” A detailed article on the BEST license appears in the December 2011 issue of Technology Transfer Tactics. To subscribe and access the full article, plus more than four years of archived back issues filled with practical TTO success strategies, CLICK HERE.

Posted January 25th, 2012 under Tech Transfer

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