Peculiarities of Technology Licensing - Report Example

Technology Licensing Introduction The concept technology licensing refers to granting of rights to a licensee to enable him or her to use specific technologies, know-how, patents, software, or product design (Rahm, 1994, 12)1. The practice has been common to many universities and research institutes. Universities develop and license innovative ideas or technologies that they have discovered in their research process. Most universities have experts for performing cutting edge research and discovering of new technologies. For this reason, universities have the core patents and the basic knowledge for breakthrough technologies. Obtaining license from these institutions allows an individual to access such a technology at a price that is lower than if the person was to develop the technology by him or herself (Rahm, 1994, 14)2. Although one may be licensed to use a certain technology, the university may put some limits to the use of that particular technology. However, it is not all the time a university may limit ones license to a particular field of use. Universities in this case may retain some rights for its technology. For example, the university may reserve the patents on the technology for one not use it for education purposes and research, or publish papers regarding the technology. In addition, the research sponsor may also retain some rights on the technology. For example, if the innovation of the technology was sponsored by a government, the government reserves certain rights to use the technology to perform certain functions (Rahm, 1994, 17)3. Factors to consider when licensing technology In this matter, there are factors which universities should consider when licensing technology. First, the universities should retain the right to put into practice the licensed inventions and give room for governmental organizations and non-profit to practice too. In the process of preserving university ability to do research, it is good to allow the researchers to publish their research results in peer reviewed journals or dissertations. Other scholars should also be allowed to make verification of the published results irrespective of patents. Also the university should retain rights to a technology in all fields of application, even if the technology has been exclusively licensed to a commercial entity (Kalis, 2001, 122)4. For example, the case of John M.J. Madey v. Duke University. 307 F.3d 1351; 64 U.S.P.Q.2d (BNA) 1737, infringement on the licensed technology for non-profit activities by the university and other organization was exempted. Allowing the patents infringement will enable the students to practice issues in real life situation. However, the case of Merck KGaA v. Integra Life sciences I, Ltd. which clarifies the scope of 1984 safe-harbor protects some users from being sued because of patent infringement (Kalis, 2001, 122)5. Second, exclusive licenses should be made in a way that offers room for development and use of technology. When there is an organization wishing to use a lot of resources and time in certain technology so as to achieve its wide implementation, a university should grant exclusive licensing to the organization. However, the Technology Transfer Office (TTO) should be aware of the possible impact that may result from granting exclusive license on future research, uses that are not anticipated, and efforts on commercialization. The university should grant such rights in areas where it has to encourage technology development. Example of such licensing may include: field-restricted, co-exclusive, convertible exclusive and non-convertible exclusive licenses. Under the field-restricted, licenses gives rights that cover particular product that the licensee has the ability to and be committed to develop or produce. In this case, the licensee is safeguarded under the licensing by the university, at the same time giving room for other parties not competing with the licensee to develop the technology. Also, the other forms of licensing give room for further development and use of the licensed technology (Kalis, 2001, 122)6. Third, universities should minimize the future improvement licensing. Future licensing by universities has been found to enslave the faculty research program members to the licensed company. If a university commits itself to research for the company’s new ideas, it may lack funds for further research. For this matter, the licensee under exclusive licensing should not be given automatic rights for future improvement. Fourth, universities should help in managing and anticipating transfer of technologies that have conflicts of interest. The TTOs should be aware concerning their roles in identification, review and management of interest conflicts at institutional and investigator. Licensing ideas innovated by students or faculty can results into conflicts of interest, where such conflicts should be resolved by administrative and academic officers, and committees outside the TTOs (Kalis, 2001, 124)7. Fifth, universities should ensure that all research tools are available for the researchers. Such tools will be important for the verification of already published data and conclusion. Sixth, universities should consider carefully the enforcement actions. In the process of protecting intellectual property, universities should mind their key mission of promoting development of technology for society benefit. Efforts should be put to ensure all parties benefit, and the new technology is adopted and expanded. Though lawsuit would be ideal for a university to protect its intellectual property, it should be done in a proper way to ensure no unnecessary impediments to the use and development of the new technology (Kalis, 2001, 125)8. Seventh, universities should put into consideration the export regulations. Universities TTOs should have good knowledge on export regulations and laws and how such laws and regulations will affect their practice of licensing. They should be careful not to license confidential information that may adversely affect the whole body of university research. Eighth, universities should consider the effects of working with patent aggregators. If the consolidation of rights will lead to development of new technologies, the university should allow the patent aggregators to go on with the exercise. Last and not the least, universities should consider including in their licensed technologies provisions that tackle unmet society needs. Such provisions could include: agricultural technologies for the less developed countries, technologies addressing the neglected geographical areas, or patient population, and improved therapeutics. Such provisions will be of great importance to societies socially and economically (Kalis, 2001, 126)9. The impact of Technology Licensing University technology licensing has an impact on the institution itself, the licensee, and the entire society. The impact could be positive or negative. University research and technology licensing play a key role in economic growth and industrial innovation. Academic researches have been found to have a positive relationship with the increasing number of new products in United States. Most industries rely on contributions of academic science. However, licensing and patenting limits the knowledge transfer from universities to industry. Researches done by universities have positive effects on industrial innovation in areas such as biomedicine, and IT (Powers, 2003, 39)10. Technology licensing has also impact on the university system. University technology licensing in most cases has been found to cause delays in publication of research finding. This has negative effect to the university, as the indented purpose of the study may not be fulfilled within the right time. University researchers who practice patenting on technologies are more productive on researcher work than those who do not. However, such productivity may be impeded at higher patenting levels. University technology licensing also plays a key role in mobilizing funds for further research (Powers, 2003, 39)11. University technology licensing limits the ability of other investigators to expand the researches done previously because of denied access to the costs of coordination. However, after university grants patents, the licensee do not cite borrowed published knowledge. This leads to unmerited use of the university technology (Powers, 2003, 40). Technology licensing also has impact on research results commercialization. Technology licensing by universities delays the commercialization of the research results. Some universities claim that their inventions have not yet reached the level of commercialization. They argue that early commercialization of the new technologies result to commercial failures. University-sponsored science park environments have been found not to increase the survival chances of many firms, where as the science park firms have found to be more efficient in research (Powers, 2003, 41)12. Role of faculty and TTOs in Technology Licensing The faculty in a university plays a key in helping to license university intellectual properties. The faculty can help in technology licensing by participating in a number of activities involved in the process. The faculty can participate through the following styles: seamless web, hand-off and knowledgeable participant. The environment of institutions influences the decisions by faculty to disclose the inventions. Also, the costs of interacting with technical transfer offices determine the participation of faculty in disclosing the inventions (Rahm, 1994, 26)13. The faculty also plays a vital role in preparation of patent application, identification of potential candidates to be licensed on technology commercialization, and improvement of technological inventions. University technical transfer offices on the other hand play an important role in commercialization of research results by acting as an influencer, protector, and propagator of a new technology. The TTOs also play the role of establishing scientific acceptance and legitimacy of new technology where ethical issues are necessary. Technology licensing ensures that research results commercialization is appropriate as the universities will be committed to license appropriate research findings (Rahm, 1994, 27)14. China Efforts in Technology Licensing Technology licensing has proved to be very important in many countries where some governments have given the universities to patent their inventions. The Bayh-Dole model has been applied in many countries in licensing technologies. However, in some countries such as China it has been difficult to protect its intellectual property. Researches show that technology licensing and transfer in China is difficult even to promote China. The recent China patent licensing procedures are based on assertion models and patent pools (Powers, 2003, 34)15. The law in China does not restrict the licensee on infringement for development of new technologies. Moreover, the licensor must give warrant to the licensee on guaranteed ownership during the contract period. These two factors pose a big challenge in IP protection in China. In case of a lawsuit for a signed contract with a foreign company, the Chinese law must be applied. Protecting the intellectual property in China becomes hard as the former employees leak the knowledge to other organizations. This makes it hard to license the technology to companies in China as they already have the ideas (Powers, 2003, 34)16. Despite these limitations, China has worked hard to develop new technologies to apply within the country and contract to the western countries. The country is emerging to be the most innovative country and wishes to be having strong economy in the world by 2020 through inventions. China has engaged in several patent licensing to foreign companies and also Chinese companies. Universities and government are the one responsible for the transfer of technologies from China. Though China is poor in intellectual property protection and licensing on technology, for the last few years there has been improvement on this. Chinese belief that collaboration in technology transfer is the way out to minimize some of challenges involved in the process as the risks are shared. China is become more potential in technology licensing and transfer, but the owners of intellectual property should be aware of the possible risks and, learn ways on how to deal with them (Powers, 2003, 36)17. Conclusion In conclusion, technology licensing is very significant to universities as it protects their intellectual properties. In the process of licensing technologies, universities should put into consideration some of measures that allow quick commercialization of inventions and further development of the ideas. Also the universities should carry out technology licensing in a manner that ensure further research from the realized funds. Faculty should participate in the technology licensing by identifying the right candidates to license. Governments should not only enact laws that address only protection of intellectual property , but also address how technology can be used to enable quick commercialization before the inventions become invalid. The governments should also not leave the issue of technology licensing and transfer to universities as this will lead to more conflicts of interests. References: Kalis Nanette. Technology commercialization through new company formation: Why U.S Universities are Incubating Companies. Cornel: Corrnell University Press, 2001, p. 120-127 Powers, Joshua. Commercializing Academic Research: Resource Effects on Performance of University Technology Transfer. Journal of Higher Education, 74, 2003, 34-42 Rahm, Dianne. Academic Perceptions of University-Firm Technology Transfer. Policy Studies Journal, 22(4), 1994, 12-27 Read More