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Intellectual Property and Tech Transfer

Intellectual Property and Tech Transfer

News 09/06/2022

In today’s knowledge economy, commercialising research is of increasing importance to researchers and universities. For example, funding bodies increasingly require grant applications to have demonstrable impact to be successful, and this may be achieved by mapping pathways to commercialisation at the outset of research.

Commercialisation processes such as agreeing licencing deals or spinning-out companies may help address societal challenges and make a real-world impact. Such processes may also be lucrative for researchers who are prepared to take their concepts into industry.

The process of tech transfer typically involves multiple parties, including the researchers themselves, the institute under which they do their research, outside companies and investors. A solid IP strategy may help attract investment, and investors typically require IP rights to be integrated into the business plan. Increasingly, investors are engaging external IP consultants to navigate complex IP portfolios before committing to any deal. IP may be a valuable asset, adding to the corporate value of a company.

Spin-out landscape in the UK

A recent report by GovGrant [1] reveals that 958 spin-out companies were founded in the UK between 1998 and 2018. This sample represents £19.2 billion of capital invested, 4,495 deals and 1,907 investors.

Just over half of all capital (£6.1 billion, 51%) raised during this time went to 266 (28% of the total) spinouts in pharmaceuticals and biotechnology. £1.1 billion went to 50 (5.2%) computer hardware spinouts. £1.0 billion went to 132 (13.8%) healthcare device and supplies spinouts. The remaining spinouts relate to software, energy equipment, consumer durables, semi-conductors, chemicals and gases or other commercial services or products.

IP is a key asset for such spinout companies. Without IP, most often there will be no company worth forming.

Identifying patentable opportunities

It is important to think about IP at the earliest opportunity.

University tech transfer offices often play a key role in identifying patentable opportunities. For example, excitement and passion for a discovery does not necessarily mean there is a market for it. To be viable, a product or service must address a real problem in the market that buyers actually want to solve. Preliminary literature reviews or freedom to operate searches may be performed to identify what has already been achieved commercially.

In order for a product or process to be successfully patented, it must be novel (not disclosed in the prior art), inventive (non-obvious) and sufficiently described in the patent application (to allow the invention to be reproduced by any other party). This is the so-called “patent bargain”, meaning the potential reward of a monopoly (through patent “claims”) is only granted by a state in exchange for disclosing the invention (the “description”). This means the invention is known by the public once the patent application publishes (typically at 18 months from first filing) and allows the invention to be practiced without licence after the patent term has expired.

The claims define the scope of the patent and determine whether any competing product or service infringe. How claims are drafted in a patent application may therefore be critical. If the claims are drafted too narrowly, a competitor may be able to easily design around the patent. Conversely, if the claims are drafted too broadly, the patent may be more likely to be found invalid. Investors typically want to see that the patent claims cover the commercial product or service and can also be used to block competitors from entering the market.

There is often a pressure for academic researchers to present their results as early as possible at public conferences or within peer-reviewed papers. With commercial goals in mind, however, patent filings should be made before any public disclosure of the invention. Any prior publication may act to destroy the novelty of any later patent application. The threshold for inventive step may vary depending on the technical field and territories in which patents are being pursued and may sometimes be the most difficult hurdle to overcome in achieving grant of a patent. However, any non-routine development or surprising results arising from research may potentially be captured by a patent application, if such discoveries are not taught or suggested by the existing literature.

Developing an IP strategy

Although a heavy emphasis is placed by spin-out companies and investors on patents, other kinds of IP can be just as useful. Spin-out companies need to consider which IP rights are relevant to their business and what stages to protect their IP assets. Other forms of IP such as copyright, designs, trademarks and trade secrets should be considered. For example, copyright and designs protect original creative content whilst trademarks may be used to protect and build a company brand. Companies should seek to secure IP rights for all relevant assets and ensure its IP portfolio is well aligned with its objectives and processes.

Trade secrets may also be a key part of a company’s IP and may sometimes be overlooked. Trade secrets relate to any confidential business information which provides an enterprise a competitive edge and is unknown to others. Companies should take preventative measures to protect trade secrets, including the use of non-disclosure agreements (NDAs), non-compete agreements (NCA), robust IT security infrastructure and controlling the accessibility of important documents to only those within the company that need them.

Ownership of IP rights may sometimes be complex, for example during collaborations between other universities or companies or if any of the inventors are employed by more than one research institution. It is important for any relevant assignments to be signed early to help avoid any potential disagreements arising at later stages.

An IP audit may be used to make an inventory of all potential IP assets within a company. This can be used to help determine ownership and help identify any related threats such as IP infringement by the company or by other parties. Companies should also consider how to police such potential infringement, and how the IP may be defended. In addition, companies should consider how they are going to exploit their IP to generate income streams and expand market share.

How can we help?

The attorneys at Secerna LLP have a wealth of experience in advising on IP capture and portfolio management. We can assist in extracting the maximum value from your IP, enabling further growth and development of your company. If you would like any further information, please do not hesitate to contact Charlotte Watkins or Huw Jenkins at