Products, Partners & Public Health: C i li i NCommercializing New

Technologies From Intramural NIHTechnologies From Intramural NIH

Steven M. FergusonDeputy Director Licensing & EntrepreneurshipDeputy Director, Licensing & Entrepreneurship

NIH Office of Technology TransferHHS Email: sf8h@nih goHHS Email: sf8h@nih.gov

In biomedical researchresearch, we’d like to think that all roads willroads will eventually l d tlead to Bethesda…

NIH – U S National MedicalNIH U.S. National Medical Research Agency

• Annual budget of $ 30.9 billion (FY12) • 10% of funding for intramural research• 6,000 intramural scientists / 18,000 staff / 2,000 projects, , , p j• 325,000 extramural scientists /50,000 grants / 3,000

organizationsorganizations• Basic & clinical research discoveries

P i li i d• Partners commercialize into products

The National Institutes of Health

NLM

27 Institutes and CentersCC CIT

CSRNLM

FICNCCAM

NINRNINDS

NIMH

CIT

NCMHD

NIGMS

NCCAM

NCI

NIMH

NIEHS

NIDCR NEI

NIDDK NCRR

NIDCD NHGRI

NHLBINIA

NIDANICHD

NIBIBNIA

NIAIDNIAMSNIAAA

NICHD

National Institutes of HealthSupport of Biomedical Research pp f

to Benefit Public Health

• Funding• Training

• Clinical Trials• Inventions• Training

• Basic Research• Inventions• Policies

Why NIH Intramural Research ProgramsWhy NIH Intramural Research Programs Are Attractive For Commercial Licensors

• Novel, fundamental research discoveries• “Supermarket” for research tools • Collaborations generally available for basic or g y

clinical (applied) studies• Selected projects in early clinical developmentSelected projects in early clinical development• Licensees do $6B in annual sales

Goals For Intramural NIH TechnologyGoals For Intramural NIH Technology Transfer Programs

• Benefit the public health

• Utilize IP appropriately as incentive for commercial development of technologiesp g

• Attract new R&D resources

• Obtain public return on public investment

• Stim late economic de elopment• Stimulate economic development

Future Commercial ProductsFuture Commercial Products Licensable From Several Sources

• Intramural Research (from the NIH Office of Technology Transfer)

• University Grantee Research (from specific y ( puniversity technology transfer offices)

• SBIR and STTR Programs (from smallSBIR and STTR Programs (from small business awardees)

• New SBIR TT Program (combines SBIR award• New SBIR –TT Program (combines SBIR award & intramural license agreement)

Intramural NIH Basic & Clinical Research Collaborations

Intramural NIH ResearchIntramural NIH Research Collaboration Mechanisms

• Material Transfer Agreement (MTA) - non-profit• Cooperative Research And DevelopmentCooperative Research And Development

Agreement (CRADA) - for-profit• Clinical Trial Agreement• Clinical Trial Agreement• Specialized Development Services• Training Programs• Informal “official duty” collaborationsy

CRADA - Cooperative Research andCRADA Cooperative Research and Development Agreement

• Collaboration between Government lab & outside party

• Government provides expertise, equipment & materials

C ll b id d ibl• Collaborator provides same and possibly money

• Provides Collaborator with right to elect exclusiveProvides Collaborator with right to elect exclusive option to new inventions

Industry Interactions With NIHIndustry Interactions With NIH Intramural Scientists

• Collaborations should be “official duty” projects• Informal -- uncompensatedp

• Formal (CRADAs, CTAs) -- uncompensated

Fi i l f i i i i l• Financial support from company is to institution only • Public-Private-Partnerships via FNIH

• Lab funding (under CRADA)

• Royalty income under licenses (shared with inventors)• Royalty income under licenses (shared with inventors)

Technology Licensing At NIHTechnology Licensing At NIH

NIH Product Licensing Principles

• Granting only the appropriate scope of rights• Permit research usesPermit research uses• Preference for non or partial exclusivity

S ifi d fi ld f• Specified fields of use • Enforceable benchmarks

Typical Types Of Royalties In NIHTypical Types Of Royalties In NIH Intramural Licenses

• Execution RoyaltyMi i A l R lt ( dl f th• Minimum Annual Royalty (regardless of the amount of Net Sales

• Earned Royalties (fixed % of Net Sales)• Benchmark Royaltiesy• Patent Costs• Equity (?)• Equity (?)

Typical Factors Influencing Royalty Rate NegotiationsRate Negotiations

St f D l t S f P t t• Stage of Development• Type of Product

• Scope of Patent Coverage

• Market Value of Product

• Market Timing• “Content” in Final

• Uniqueness of Materials

Product• Public HealthMaterials Public Health

Research Products Licensed From NIH

i l h d iTypical Research Products License (Commercialization)(Commercialization)

• Non-exclusiveNon exclusive• Materials provided (patented or unpatented)

S ll fi d i t li• Smaller firms predominate as licensees• High earned royalty rates• Low upfront costs• Products: CHAPS, antisera, mabsProducts: CHAPS, antisera, mabs

i l h d iTypical Research Products License (Internal Use)(Internal Use)

• Non-exclusive• Non-exclusive• Materials provided / screening use permitted

h h h d• No reach through to products• Larger firms predominant• Paid-up term licenses or annual fees• Products: muscarinic receptorsProducts: muscarinic receptors

Diagnostic & Therapeutic Products Licensed From NIHLicensed From NIH

i l i i i OTypical Vaccine, Diagnostic Or Therapeutic LicenseTherapeutic License

• Exclusive if required for developmentExclusive if required for development• Most major pharma or biotech have at least one

D t il d d l t l ith b h k• Detailed development plan with benchmarks• Preference for capable small firms• CRADA research separate from license• U.S. manufacturing for U.S. product salesU.S. manufacturing for U.S. product sales

T i l V i Di ti OTypical Vaccine, Diagnostic Or Therapeutic License (Cont.)p ( )

• Substantial upfront feesp• Moderate earned royalties• Appropriate benchmark payments• Appropriate benchmark payments• Share sublicensing payments• “White Knight” (public benefit) provisions• Monitor performance of licenseep

Old “ ” i dOlder NIH “Homerun” Licensed ProductsProducts

• Abbott HIVAB (AIDS Test Kit)( )• BMS Videx (ddI)• BMS Taxol (paclitaxel)• BMS Taxol (paclitaxel)• Schering Fludara (fludarabine)• GlaxoSKB Havrix (hepatitis A)• Roche Hivid (ddC)( )

M R t P d t A lMore Recent Product Approvals

• Angiotech Taxus (paclitaxel-eluting stents)• Genzyme Thyrogen (rTSH)• Isis Vitravene (antisense CMV)• Medimmune Synagis (RSV mab)• Millennium Velcade (myeloma drug)• Millennium Velcade (myeloma drug)• Biogen Idec Zevalin (NHL I131 mab)

i ( )• Amgen Kepivance (KGF)

AcuTect AIDS Test Kit Beaucage Reagent BRCA1 Diagnostic CertivaReagent BRCA1 Diagnostic Certiva

CHAPS Fludara Fecolator HavrixImmunoWELL® Matrigel®ImmunoWELL® Matrigel®

Invasion Chamber MirakelleNeuTrexin® ParaSightF PixCell

Soluble Interleukin-2 Receptor Squirrel Free Seed Saver Synagis Taxol®Thyrogen TransProbe-1® Videx®Thyrogen TransProbe 1® Videx®

Vitravene

NIH Licensing Portfolio

> 600 products developed to date (25 vaccines and therapeutics)( p )

Over 84% licenses – non-exclusive

Over 86% licenses – U.S. firms

O 52% li ll iOver 52% licenses – small companies

Annual Sales By Licensees – nearly $6By y

NIH Technology PortfolioNIH Technology Portfolio• 351 invention disclosures per year (FY11)• 351 invention disclosures per year (FY11)

• ~3500 total pending/issued patents p g p(131 U.S. Patents issued FY11)

1300+ ti li (197 t d FY11)• ~1300+ active licenses (197 executed FY11)

• $96.9 million in royalties collected FY11$ y

• 68 CRADAs executed FY11

Pilot Program In FY12:E St t Li A tExpress Start-up License Agreements

For Small Companiesp• Up to 50 employees, in business up to 5 years with

i d i l $raised capital up to $5M• For vaccine, drugs or other therapeutics• 1 year option agreement for $2K• Convertible to exclusive license with heavilyConvertible to exclusive license with heavily

deferred financial terms• Financial terms pre set• Financial terms pre-set

New In FY11: SBIR-Technology gyTransfer (TT) Contract Awards

• Pilot study from National Cancer Institute (NCI) and h Offi f h l f (O )the NIH Office of Technology Transfer (OTT)

• Out-licensing bundles with SBIR funding to move inventions from intramural NIH to the market

• Pilot is based on the successful program at NISTp g• In FY11, two SBIR-TT “Requests For Proposals”

(RFPs) were guaranteed funding & published• Program is being expanded to other NIH SBIR offices

C ll b ti SBIR TT C t tCollaborations on SBIR-TT Contracts

NIH labs can collaborate under many different formatsCompany can exchange knowledge with the NIH researcherp y g gCompany can utilize fixed asset resources at NIH

Company cannot contact NIH researchers prior to contract p y pawardCompany cannot rely on the NIH lab to perform the majority p y y p j yof the effort being proposed for the SBIR contractCompany cannot fund work in NIH lab using SBIR money under a CRADA

The SBIR- TT Internal Use LicenseThe SBIR TT Internal Use License

• “Royalty-free, non-exclusive” internal use license given with SBIR-TT award periodg p

• SBIR-TT research completed without infringement of NIH patentsof NIH patents

• Internal R & D allowed using the invention, but not sales of the final commercial productsales of the final commercial product

The SBIR-TT Commercialization License

• Need to develop NIH invention into a commercial product that benefits the public

• Commercialization license required to sell product (if issued IP claims) and/or requested (if only pending claims)

• Commercialization license also required for each SBIR-TT Phase II topic

• License terms are negotiable

• For internal use license agreements• Select materials for licensing from on-line catalog• Clickable license agreement (with terms) available • Payments made through www.pay.gov (like PayPal)y e s de oug www.p y.gov ( e y )• Faster means of getting materials for corporate R&D

How To Find Technologies• NIH/FDA Licensing Opportunities

– iPhone apppphttp://itunes.apple.com/us/app/nih-ott-licensing-opportunities/id401257307?mt=8#

– Searchable databasehttp://www.ott.nih.gov/search

– Technologies RSS Feedhttp://www.ott.nih.gov/rss

Neglected Diseases– Neglected Diseaseshttp://www.ott.nih.gov/nd

– Rare Diseaseshttp://www ott nih gov/rdhttp://www.ott.nih.gov/rd

– Federal Registerhttp://www.gpo.gov/fdsys/browse/collection.action?collectionCode=FR

• CRADA Opportunities RSS Feedhttp://www.ott.nih.gov/rss/cradarss.xml

NIH: Products Partners & PublicNIH: Products, Partners & Public Health since 1887

• NIH Information: www.nih.gov• Office of Technology Transfer: www.ott.nih.gov