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Intellectual Property Management - How to
capture, protect and exploit your ideas • 13th February 2013
Gillian Davis & Julian Peck
Cambridge Enterprise Limited, University of Cambridge
Overview
• Disclosure versus Confidentiality
• Intellectual Property Rights
• Copyright, eg Software
• Patents
• Technology maturity
• Routes to market: licensing, spin-out
• Key agreements
• Start-ups and Spin-outs
• Contact points
Research outputs
Research:
Grant/Contract
Publish
Research outputs:
Technical information, data,
knowledge, techniques, processes,
methods, materials, systems
code, algorithms, calculations, formulae, results of
experiments, designs, prototypes, records, images
Commercialise
Disclose Confidential ?
Intellectual Property Rights
• Patents protect how something works (product or process)
• Know-How may be confidential information
• Designs protect how something looks
• Copyright protects expression of ideas
• Database rights protect collections of data
• Trade marks protect “designation of origin”, reputation
Copyright – the basics
• Right to control use arises automatically upon creation & is free!
• The work must be original
• For artistic, literary (software), dramatic, musical works, copyright term is 70 years
from the end of the year in which the author of the work dies
• Can stop a third party from copying the work in any form without the owner’s
permission
Software – Can the code be supplied?
• Copyright law: ownership- right to control use of software
Person creating (University policy- copyright in software belongs to researcher
unless sponsorship states otherwise)
Employer under employment contract
Company commissioning
• Identify copyright holders:
authors?
funding bodies?
publishers?
• Joint or separate ownership
• Any third party code/Open Source Software:
licence terms?
Copyright ownership
• Identify all copyright holders
• Contact all copyright holders
• Get permission to supply from all copyright holders
Code can be transferred to company and commercialised.
What if not all parties can be contacted or do not give permission?
Software can’t be supplied and exploited
Rewrite parts of the code
Code can be transferred to company and commercialised
The way forward?
• To enable the University to use software developed in-house for future
research projects and technology transfer and commercial exploitation
anyone wishing to work on development of the code should be asked to
assign ownership to the University. If any revenue is received through
the commercial exploitation of the code each creator will be rewarded in
accordance with the University’s revenue sharing arrangements.
Third Party Software!
• Take care when using or incorporating Open Source software in University
developed software
• Assess the implications of the licence terms
• Some Open Source licences contain restrictions or obligations that may
prevent you from complying with the terms of the research funding or restrict
the research and commercialisation strategy
• E.g. BSD licence – unrestricted right to use, however any copyright or other
notices in the BSD licensed materials must be preserved and maintained.
• E.g. GPL licence – users who create any modifications of the GPL code
must make their entire source code of the modification available to all third
parties on the terms of the GPL. May severely limit commercialisation
opportunities, but can be a great commercialisation strategy.
Why File a Patent Application?
Inventor: Monopoly for 20
years
Society: Full
details published
Invention: More likely
to be developed
Anatomy of a patent
• A patentable invention must be:
• Novel
• Inventive (not obvious)
• Industrially applicable
• A patent confers a monopoly right over an invention for 20 years
• But must disclose how to implement the invention, so it is accessible to all
• The definition of the monopoly right is in the Claims
• Claims are drafted in obscure language – requires the skills of a patent agent
• Main sections of a patent:
• Background
• Description
• Claims
• Abstract
• Drawings
• Not the same as an academic paper!
Commercialisation: Key considerations
New technology
Market
Ownership
Maturity
Social value
FTO
Inventor motivation
Inventor track
record
IP protection
Issues caused by lack of maturity of technology
Lack of maturity of technology
?
?
? ? ?
?
Issues caused by lack of maturity of technology
Lack of maturity of technology
Do you know whether and what to patent?
Do you know what the market is yet?
Cost of developing viable product? Desire to publish
Is there an established technology?
Does the technology
work?
Are there safety issues?
Can the technology be
scaled-up?
Technology not fully understood?
Are other inventions required?
Time from initial idea to viable product
• Initial invention: first electric light was demonstrated by Humphry Davy in 1802 –
wire to battery and thin strip of platinum, glowed and produced light
• ¾ century later and after numerous other inventions e.g.
• Right kind of filament
• Parallel circuit
• Improved dynamo
• Underground conductor network
• Safety fuses and insulting material
• Light sockets with on/off switches
• Viable product: building lit by electrical light bulbs by Thomas Edison
Time
The problem of early stage research
New technology
Market
Ownership
Maturity
Social value
FTO
Inventor motivation
Inventor track
record
IP protection
The problem of early stage research
New technology
Market
Ownership
Maturity
Social value
FTO
Inventor motivation
Inventor track
record
IP protection
Commercialisation: Key considerations
New technology
Ownership
r
t
a t
k
Increasing commercial potential
• Research Collaboration
• Sponsored student
• Consultancy
• Proof of Concept funding for prototyping, technology demonstrator
• Research Council Follow on Funding
• University funding
Commercialisation routes
Research
•Commercial potential
•Favourable key consideration
Licence to existing
company
•No existing company
•Inventor preference
1. Market technology
2. Confidentiality agreement
3. Heads of Terms
4. Licence Agreement
Development
1. Business plan
2. Raise finance
3. Form company
4. Take licence
New venture
Confidentiality agreement
• Also known as non-disclosure agreement (NDA) or Confidentiality-disclosure agreement
(CDA)
• Purpose: a legal contract between you and another party not to disclose to anyone else
confidential (i.e. not in public domain) information that you will share with them for a
specific purpose.
• A low-cost way to share information about a new technology while preventing the
receiving party from passing on this information or using the information other than for
the purpose.
• If the receiving party breaches the agreement you can take them to court for damages
• A patent or registered design defines your technology more clearly and can give
greater protection, but at far greater cost.
Heads of Terms
• Also known as ‘Letters of Intent’, ‘Memoranda of Understanding’ or ‘Heads of
Agreement’
• Purpose: a short document setting out the main agreed terms between parties
in a commercial transaction:
company A company B
• Clarifies understanding before time and money is spent on a detailed agreement
• Usually non-binding
Permission
Payment
Licence Agreement
• Purpose: A formal legal agreement detailing terms of a commercial transaction
• Key terms:
• Definitions
• Expands on Heads of Terms
• Confidentiality
• Liabilities
• Dispute resolution
• Announcements
You’re the IP Manager!
• Dr Blue has a new invention. He’s already talked to Grey Industries about it and
they’re interested in licensing.
Dr B Blue Ms R Red Prof G Green Mr G Grey
• Ms Red is a PhD student on sabbatical. She adapted some code she
found to work in Dr Blue’s invention.
You’re the IP Manager!
Dr B Blue Ms R Red Prof G Green Mr G Grey
• Prof Green is the Head of Department, and Dr Blue’s old supervisor.
He’s over the moon that Dr Blue has finally solved a problem that he
couldn’t.
You’re the IP Manager!
Dr B Blue Ms R Red Prof G Green Mr G Grey
• Mr Grey is the Technical Director of Grey Industries. He’s been
discussing this work for years with Dr Blue, and the new invention is
exactly what his company needs to solve a big problem with their
products.
You’re the IP Manager!
Dr B Blue Ms R Red Prof G Green Mr G Grey
What issues do you think there may be in trying to commercialise Dr
Blue’s invention?
You’re the IP Manager!
Dr B Blue Ms R Red Prof G Green Mr G Grey
Why universities are involved In spin-outs?
• Forming a company can be the most efficient and effective way of achieving
successful dissemination/commercial exploitation of a discovery
• An existing company does not exist poised to take the idea forward
• Interim development is needed in a company setting before it will be of interest to one
or more commercial partners
• Inventor keen to start a spin-out
Business Plan
• Purpose: a document that describes a business, its goals and strategies to
reach those goals. Helps to:
• raise finance
• find business partners
• plan your business
AUTM Startup Business
Development Primer
31
Setting expectations…a lot has to go right
PROBABILITY
• Sufficient capital 80%
• Management is capable and focused 80%
• Product development goes as planned 80%
• Production and component sourcing goes as planned 80%
• Competitors behave as expected 80%
• Customers want the product 80%
• Pricing is forecast correctly 80%
• Patents are issued and are enforceable 80%
• Combined probability of success 17%
• Harvard Business Review November-December 1998
If you want to commercialise your technology
“Cambridge Enterprise exists to help University of Cambridge
inventors, innovators and entrepreneurs make their ideas and
concepts more commercially successful for the benefit of society, the
UK economy, the inventors and the University”
University revenue sharing from licensing technology
Net Income (opt in) Inventor(s) Department(s) University
First £100,000 90% 5% 5%
Next £100,000 60% 20% 20%
Above £200,000 34% 33% 33%
Net income (opt out) Inventor(s) Department(s) University
First £50,000 100% 0% 0%
Above £50,000 85% 7.5% 7.5%
* Cambridge Enterprise pay the patent costs
* The inventors pay the patent costs
Cambridge Enterprise Group
If you want to commercialise your technology
• Talk to your Enterprise Champion – Tim Minshall
• Contact Cambridge Enterprise
• www.enterprise.cam.ac.uk
• Phone
• Complete Invention Disclosure Form
Contact Us
Cambridge Enterprise Limited
University of Cambridge
Hauser Forum
3 Charles Babbage Road
Cambridge
CB3 0GT
UK
Tel: +44 (0)1223 760339
Fax: +44 (0)1223 763753
Email: [email protected]
www.enterprise.cam.ac.uk