The section below is meant to provide answers to commonly asked questions about intellectual property issues and technology management. We encourage you to contact your case manager/licensing officer directly if you have more specific inquiries. Our staff will be more than happy to assist!
- Why should I disclose an invention to the OTMA?
Under your Patent Acknowledgement contract with the University, you have an obligation to disclose your inventions, whether or not patentable, to the OTMA for evaluation. The development and commercialization of your invention may provide significant public benefit and generate income for research and education at UCSF. A licensee of your invention may wish to sponsor research in your laboratory. Also, inventors receive a portion of the net income generated by their inventions.
- I've made a discovery. Should I submit an invention disclosure form?
If you are not sure, kindly call a licensing professional at the OTMA to discuss your invention. If you have evidence of a discovery that may have practical utility and represents a potentially attractive business opportunity, you will be asked to complete an invention disclosure form, sign it, have your signature witnessed (notary not necessary), and send it to the OTMA by email ([email protected]).
- I've been working on something interesting. When should I disclose an invention to the OTMA?
The ideal time to disclose an invention to the OTMA is as soon as you believe you made an invention, i.e. after it has been reduced to practice and well before it has been published or publicly presented. If you disclose an invention to the OTMA after it has been published or publicly presented, there is no longer an opportunity to obtain patent rights in most countries outside the United States. The opportunity to obtain patent rights in the United States ends on the first anniversary of the date of the first publication describing the invention.
- I've been working on something in an outside collaboration. Should I disclose to the OTMA?
Yes. Please disclose to the OTM, even if your collaborator offers to handle the invention with his/her university or company, as the case may be. It is safe to assume that each inventor has an obligation to inform his or her employer and that the employer of each inventor may most likely have ownership of the invention. We are pleased to coordinate with other joint owners of inventions whether they be other universities or companies. For example, if the joint owners of an invention are academic institutions, we negotiate how the invention will be managed. Not-for-profit joint owners usually establish an inter-institutional agreement that assigns responsibility for managing the invention to one of the institutions and specifies how income and expenses will be shared among the institutional owners. If a joint owner of an invention is a commercial entity, we investigate the possibility of licensing the University's rights to the commercial joint owner.
- What will the OTM do with my invention disclosure?
In those cases where the OTMA's analysis of the patentability and "licensability" of the invention suggests it represents a potentially attractive business opportunity, the licensing professional responsible for the case will try to find a good way to commercialize the invention for the benefit of the public while generating University income for education and research. After discussing the invention with the inventor(s), the licensing professional will first contact prospective licensees with a non-confidential description of the invention. A prospective licensee that is interested in learning more about the invention may then sign a confidentiality agreement prepared by the OTMA in order to speak with the inventor in confidence and review confidential information about the invention, such as a scientific manuscript, drawings, working prototype, etc... The strategy for commercialization may or may not involve seeking patent protection and licensing patent rights. Not every invention has to be patented in order to be licensed.
- Will every invention disclosed to the OTM result in a patent application?
No. The substantial expense of obtaining patent rights is only justified when the patent rights are demonstrably valuable to a potential licensee. The licensing professional will determine whether and when the filing of a patent application is appropriate in order to commercialize the invention. Typically, a potential licensee accepts responsibility for reimbursing the University for patent costs before the patent application is filed and in this way can collaborate with the OTMA on drafting the patent application. However, the OTMA does not require having a licensee in hand in order to file a patent application. Patent rights are most important and valuable when a licensee requires market exclusivity in order to justify the risk and expense of developing a product based on the invention.
- What is a license?
A license is a contractual instrument by which the University grants a party permission to use an invention that belongs to the University for specific purposes, subject to certain terms and conditions that typically include fair consideration to the University based on the estimated value of the invention. A license may be exclusive, co-exclusive or non-exclusive. A license may be restricted to a particular field of use and/or geographical area.
- If the University licenses my invention to a company, will I still be able to do research on it?
Yes. Our license terms always provide that the University retains the right to use the invention for educational and research purposes and to share the invention with other universities for their educational and research purposes.
- Who is an inventor?
Unlike authorship of a scientific publication, inventorship is a matter of law and a patent that fails to name the correct inventors may be ruled invalid under certain circumstances. The law does not recognize individuals as inventors who merely follow someone else's instructions or simply provide lab space, funding and/or equipment. The lawful inventors on a patent depend on what is specifically claimed in the patent as written. Because patent claims may change while the patent application is undergoing review by the patent office, inventorship may change as well. For the purpose of your invention disclosure form, simply name any individual who has made a creative contribution to the invention. When necessary, the OTMA will initiate a formal inventorship determination using outside patent counsel.
- What if someone who is not a UCSF employee makes a creative contribution to my invention?
It is safe to assume that each inventor has an obligation to inform his or her employer of the invention and that the employer of each inventor will have ownership in the invention because of the state labor laws that apply. Each owner of an invention has an undivided interest in intellectual property, which is called a joint invention. Sometimes, two or more universities own an invention jointly. In such cases, the universities typically establish an inter-institutional agreement that assigns to one university the responsibility for managing and licensing the invention on behalf of all the joint owners and provides for sharing costs and income among them. If the co-inventor is employed by a company, then the company and the University jointly own the rights to the invention. In this case, if the company wants exclusive use of the joint invention, it will have to license the University's ownership interest in the invention. However, in the absence of any such agreement, under the laws of the United States, each co-owner is free to license its rights in the invention independently of the other co-owner(s), without notifying them, seeking their permission, or sharing income with them.
- What are "property rights”?
Tangible materials created by UCSF scientists may be useful and commercially important although not necessarily patentable or important to patent. Examples of such materials include cell lines, transgenic mice, plasmids, software disks, and integrated circuit masks. The University owns property rights related to such materials. Unlike patent rights or copyrights, property rights do not expire. The OTMA can transfer property rights under a Material Transfer Agreement or under a license for property rights known as a bailment. A bailment may be exclusive or non-exclusive. A bailment may be restricted to a particular field of use and/or geographical area. An exclusive bailment must be reviewed and approved by the Chancellor.
- What are third-party rights/obligations?
UCSF may have obligations to third parties whose material is contained or incorporated into UCSF material. Third-party obligations may also exist when a material is made or collected (in the case of biospecimens) under sponsorship terms that restrict its ownership, distribution, and use.
If you answer ‘Yes’ to any of the following questions, third parties may have rights to your material and you should contact OTMA for further assistance with your transfer.
- Were the materials generated outside of UCSF?
- Were any components (such as a DNA construct, parental mouse strain, gene insert, etc.) obtained from outside of the providing PI’s lab, and do they remain incorporated within the material?
- Were any funds (for salaries and materials) from for-profit companies used to support the generation or collection of the material?
- Did any individual involved with the generation of the material have a consulting relationship with a company under which the generation of the material might fall?
- Were there any other agreements (such as incoming MTAs, sponsored research agreements, CDAs, etc) that may be relevant to the generation of this material?
- Are licenses to property rights worth less than licenses to patent rights?
Sometimes, but not necessarily. Some biological materials are quite valuable and if they are difficult or too time-consuming for a user to reconstruct from the public record, they may be licensed as University property under fairly attractive terms in the absence of patent rights.
- Why do I need to use an MTA when I give materials to other researchers?
Material Transfer Agreements protect the provider of materials. In addition to addressing liability and indemnification issues, MTAs help to maintain the University's property rights associated with materials "outbound" to other researchers. The OTMA is responsible for negotiating Material Transfer Agreements on behalf of the campus for transferring all materials other than human specimens. MTAs are suitable for transferring materials to non-profit institutions for their research and educational purposes. Although the OTMA may also use an MTA to transfer material to a company, it may prefer to negotiate a license (known as a bailment) with the company, depending on the circumstances. In this case, the OTM will share the license income with the developer. To transfer human specimens and human data from a clinical study, contact the Industry Contracts Division of the Office of Sponsored Research.
- What is a provisional patent application?
A provisional patent application makes it possible for an applicant to establish a priority date for patent purposes. Unlike a regular patent application, a provisional patent application is not examined by the patent office for patentability and cannot be amended. Moreover it must be converted to a regular application within one year of being filed. However, to secure a priority date, the provisional application must meet the same statutory disclosure requirements as a regular application. Hence, in practice, a provisional application should be drafted exactly as a regular application, and since attorney drafting time constitutes most of the cost of a patent application, a properly drafted provisional application will cost about the same as a regular application. The most significant practical difference is that the 20-year life of a patent begins at the time a regular application is filed; hence, a provisional application can be used to shift forward, by one year, the 20-year patent term. Doing so would be advantageous for a highly valuable invention that was expensive to commercialize because a licensee would get an additional year of patent-protected product sales (e.g. a billion dollar/yr. therapeutic drug). On the other hand, using a provisional patent application to shift the patent term also delays when the patent issues and thus can delay the ability of the patent holder to assert its rights under the issued patent against infringers. Strategically, provisional patent applications may thus require one to think about how soon the patent holder needs the issued patent versus how valuable it will be 20 years hence.
- How much does it cost to file a patent application in the United States?
Depending on the complexity, writing and filing a patent application may cost roughly $8,000 to $15,000. Additional costs are incurred as the patent office reviews the application (the patent prosecution process) and even after the patent issues so that a single U.S. patent, over its lifetime, may cost on the order of $30,000 and often more.
- How much does it cost to file a patent application outside the United States?
The cost of filing, prosecuting and maintaining a single application in Europe and Japan is roughly $100,000 (often more) but foreign rights can in some cases easily exceed $200,000 over the life of the patent (and can be as high as around $500,000). Patent rights outside the United States are not available for inventions that have been made public unless a U.S. patent application was filed prior to the public disclosure. Patent rights outside the United States are available if applications in other countries are filed within one year of the U.S. filing.
- Will the OTMA license my invention to my start-up company?
The licensing professional with responsibility for the invention has an obligation to seek the best means to commercialize the invention for the benefit of the public and to generate income for education and research. Your start-up company will be considered along with any other opportunities for commercialization, and may or may not be the best alternative available.
- Will the OTMA release its ownership of an invention back to the inventors?
Yes, if possible and if other opportunities for development do not exist. Under your Patent Acknowledgement with the University, you agree to assign your rights, title, and interest in your invention to the Regents of the University of California and you execute such assignment documents as part of the OTMA's Technology Disclosure Form each time you disclose an invention to the OTMA. If the University decides to release its rights to the invention back to the inventors, the inventors must sign an agreement called a "release letter" in which they assert they will not use University funds and facilities for further research or development of the invention. They also promise to appraise the University in writing of their attempts to commercialize their invention on a regular basis. This agreement becomes void if they do not report progress towards commercialization, and their rights revert back to the University. When an invention is released to the inventors, patent prosecution and licensing become their responsibility. Sometimes the research sponsor puts restrictions on the release of inventions made with its funding. Inventions generated with federal money, in whole or in part, must be first referred to the federal government so that the government if it so chooses, can assert title to the invention. The inventor must then ask the federal government to release rights to the inventor for inventions made in whole or in part with federal funding.
- Who is authorized to sign agreements such as Licenses, Material Transfer Agreements, or Confidentiality Agreements on behalf of the University?
- UCSF conducts business under the aegis of the Regents of the University of California, which is a California constitutional corporation, and only individuals with Regential authority can sign legal agreements that bind the Regents. The Office of Technology Management Director has this signature authority for managing the intellectual property UCSF's employees have created.
- OTMA staff negotiate all licenses for inventions managed by the OTMA on behalf of UCSF and the State of California. These licenses are signed by the Office of Technology Management and Advancement Director subject to their compliance with the legal form as determined by UC's Office of the General Counsel. In addition, the OTMA a) reviews and negotiates as necessary Confidentiality Agreements covering UCSF proprietary information related to inventions under the OTMA's management, and b) is responsible for outgoing Material Transfer Agreements for all materials generated at UCSF, other than human specimens.
- The Industry Contracts Division of the Office of Sponsored Research will review and negotiate: a) Confidentiality Agreements related to the company research agreements handled by the OTMA, b) incoming Material Transfer Agreements for all materials regardless of the nature of the provider (e.g. a company, university, government laboratory, research institute, etc.), and c) outgoing Material Transfer Agreements only for human specimens.
- Principal Investigators and other laboratory members are generally not authorized to sign such agreements on behalf of the University. However, PIs on occasion may be asked by the OTMA to sign such agreements, not as a party to the agreement, but rather to indicate that they have read and understood the document and its terms. Investigators should feel free to ask the OTMA staff for clarification if specific terms in the agreement appear problematic or are not clear.
- PIs may sign Material Transfer Agreements (MTAs), without review by the OTM, when transferring non-patented, non-licensed, non-human specimens to another non-profit educational or research institution via the Non-Profit Material Transfer Agreement found on the OTMA website, provided no changes are made to the agreement template. If the materials are related to a Technology Disclosure (http://ita.ucsf.edu/researchers/commercialize-invention/disclose) filed with the OTMA, the PI should contact the OTMA so that the OTMA can review and handle the request. The investigator should provide the OTMA with a copy of the fully executed Non-Profit MTA for its files. If the recipient investigator or institution requests modifications to the Non-Profit MTA template, the PI must direct these requests to the OTMA before signing the modified MTA.
- I have received a request from another academic institution or company for biological materials that are not human specimens and that were generated in my lab. What process should I follow at this point?
- If a colleague at a non-profit educational or research institution has requested the materials, the UCSF laboratory PI may transfer the materials using the standard UCSF Non-Profit Material Transfer Agreement (MTA) found on the OTMA website. PIs may sign this standard UCSF MTA without review by the OTMA only when transferring non-patented, non-licensed, non-human specimens to another non-profit educational or research institution. If the recipient investigator or institution requests modifications to the agreement, the PI must first direct these requests to the OTMA for review before signing the modified MTA. If the materials are related to a Technology Disclosure filed with the OTMA, the PI should first contact the OTMA so that the OTMA can review and handle the request. A copy of the fully executed MTA should be supplied to the OTMA for its files.
- If a colleague at a company has requested the materials, notify the OTMA. The OTMA will negotiate and draft the MTA or, in some cases, may require the company to take a license that the OTMA will negotiate. The OTMA will share the license income with the developer.
- I would like to request materials from another academic or industry laboratory. What process should I follow at this point?
The Industry Contracts Division of the Office of Sponsored Research handles incoming materials from all types of providers, e.g. government labs, research institutes, companies, universities, etc. Your technology case manager can help connect you with the individual within ICD who will process your incoming MTA request.
- I would like to arrange a mutually beneficial collaboration, unfunded or funded, with a colleague in the industry. What process should I follow at this point?
- If the collaboration involves an invention you made at UCSF, contact the OTMA.
- For all other collaborations with the industry, contact the Industry Contracts Division of the Office of Sponsored Research.
- A company has approached me and asked me to speak with its scientists about some of my unpublished work. Do I need to notify anyone at the University?
- Contact the OTMA to discuss your intended presentation/discussions. UCSF employees have an obligation to disclose their inventions, whether or not patentable, to the OTMA so that the OTMA can develop a management strategy that maximizes the value of campus research by preserving potential patent rights.
- The OTMA likely will put a confidentiality agreement in place for you with the company prior to any discussions in order to protect any inventions you have made and the University's potential patent rights.
- Notify the OTMA as far in advance as possible in order to allow the OTMA and the company to negotiate and execute the confidentiality agreement.
- A colleague at another university has invited me to visit and discuss/present my latest research. What should I do if some of my findings might have commercial value?
- Contact the OTMA to discuss your intended presentation/discussions. UCSF employees have an obligation to disclose their inventions, whether or not patentable, to the OTMA so that the OTMA can develop a management strategy that maximizes the value of campus research by preserving potential patent rights.
- Please refer to "What is a public disclosure?" below and its possible consequences.
- A scientist has asked me to attend an informal meeting (dinner, etc.) to discuss a possible invention and asks for my expertise in a given area. The scientist has some connection with a funded or start-up company. Are there guidelines for disclosure? Should I be compensated for such a discussion?
- If you will be discussing any of your unpublished work/research, please contact the OTMA prior to your discussions with the scientist. The OTMA will see that a confidentiality agreement is put in place prior to any discussions in order to protect any inventions you have made and the University's potential patent rights.
- Notify the OTMA as far in advance as possible in order to allow the OTMA and the company to negotiate and execute the confidentiality agreement.
- Notify the OTMA if, after your discussions, you feel that you have contributed to the conception or the reduction to practice of an invention.
- In terms of compensation, please refer to the question below regarding consulting arrangements.
- It is generally unrealistic to expect to be compensated for such a one-time meeting unless a prior consulting agreement is in place.
- A company has requested my consulting services. Am I able to consult while maintaining my position as a faculty member?
- Faculty are able to consult as long as their obligations as consultants do not conflict with their obligations as University employees. Guidelines for policies on the commitment of time for faculty can be found at http://www.ucop.edu/research-policy-analysis-coordination/policies-guidance/conflict-of-interest and http://www.ucop.edu/academic-personnel-programs/academic-personnel-policy. Also, guidelines specific to consulting can be found at http://www.ucop.edu/academic-personnel-programs/programs-and-initiatives/faculty-resources-advancement/faculty-handbook-sections/outside-professional-activities.html and at http://academicaffairs.medschool.ucsf.edu/faculty-consulting-activities, which provides sample consulting agreement language.
- The University is not a party to consulting agreements, which are agreements between the company and faculty members and personal to the faculty member. As such, the OTM will not negotiate consulting agreements on behalf of University employees.
- Are there established guidelines for compensation for involvement on the Scientific Advisory Board of a start-up company?
- The University is not a party to these agreements and does not negotiate financial terms on behalf of the advisor.
- Each company sets its own compensation which can vary widely and can comprise cash, stock options, or some combination of the two.
- I made an invention while consulting for a company and my client wants to file a patent application for it. Do I need to do anything besides assisting the client with the application?
- Your Patent Acknowledgement with the University and the employer/employee relationship under the California labor laws dominate your obligations to your client. You must disclose the invention to the OTMA as per your Patent Acknowledgement, but do not sign the Technology Disclosure Form because doing so assigns your rights to the University.
- The OTMA will work with you and your client company to determine if the University has any ownership rights to the invention, in whole or in part, based on Section 2870 of the California Labor Code and UC policy.
- The company can take title to your invention if: a) you made the invention without using any University facilities or resources administered by the University, b) the invention is not subject to a third party obligation the University must honor, and b) the subject matter of the invention falls outside the scope of the subject matter of the research you and your immediate work group conducts at the University.
- If the OTMA determines the University has an ownership interest in the invention, and if the OTMA decides to assert its rights in the invention, it will ask you to sign the unsigned Technology Disclosure Form you already submitted, thereby assigning your rights to the University.
- The company then may negotiate a royalty-bearing license with the OTMA for the University's rights in the invention.
- If I consult for a company, can I also receive funds from the company for my own research at UCSF?
- The compensation you receive from your client means that you have a financial interest in the company. Before you can receive research funds from the company you must formally disclose your proposed research and company financial interest (Form 700U; "Statement of Economic Interests") to the Chancellor's Advisory Committee on Conflict of Interest. The Committee, which meets once a month, will review your disclosure to determine to what extent your financial interest in the company might bias your objectivity as a researcher performing research that is funded by the company.
- If the Committee determines there is a financial conflict of interest in research, it will inform you of ways to manage that conflict which can range from barring you from accepting the research money to allowing you to accept the funds subject to certain steps you must take, subject to the specifics of the case.
- How do I initiate communication with the OTMA regarding a possible invention in my lab?
- Call or email any licensing professional listed on the OTMA website.
- After speaking with the licensing professional, he or she may ask you to file a formal Technology Disclosure Form, which you can download from the OTMA website and complete as a Word document.
- Through the Technology Disclosure Form, you will be asked to describe the invention and the events leading up to the invention, and to list all inventors, funding sources, related MTAs, and any prior or anticipated public disclosures. The form is a legal document that you must sign and date. It must also be signed and dated by two witnesses (notary not necessary) who do not have a vested interest in the invention but who are competent to generally understand what the invention is.
- I made an invention on my own time without any University resources. Am I free to license and commercialize my invention on my own?
- Under the Patent Acknowledgement, you have an obligation to disclose any inventions (even those made on your own time or as a consultant) to the OTMA that you make concomitant with your employment by the University so that the OTMA can determine if the University has any rights to the invention under the California labor laws.
- You will be entitled to own your invention if: a) you made the invention without using any University facilities or resources administered by the University, b) the invention is not subject to a third party obligation the University must honor, and c) the subject matter of the invention falls outside the scope of the subject matter of the research you and your immediate work group conducts at the University.
- If the University has no rights to your invention, the OTMA will at your request provide you with a no-rights-claimed letter that you can show investors, licensees, business partners, etc. that states that the University has determined it has no rights, title, and interest in the invention.
- Should I disclose to the OTMA before or after I have submitted my work in abstract or manuscript form?
- It is critical to disclose your invention to the OTMA as soon as the invention is in hand. Thus, you should be disclosing well before a manuscript or abstract is drafted.
- Disclosing early affords many advantages, including proper assessment of the technology by the OTMA (which can take months), development of an appropriate management and marketing plan by the OTMA, and the ability for interested companies to evaluate the licensing opportunity before the opportunity to obtain patent rights is lost.
- Depending on the invention, many companies may have no interest in licensing the invention unless they can obtain a license well in advance of any enabling public disclosure of the invention in order to have lead time over their competitors.
- Importantly, the ability to obtain foreign patent protection in most foreign countries for an invention is lost immediately upon the enabling public disclosure of such an invention (please refer to “What is a public disclosure?” below).
- Many companies are not interested in licensing rights to inventions for which foreign patent protection no longer is available.
- Who should be listed as "inventors" on the Technology Disclosure Form?
- Unlike authorship of a scientific publication, inventorship is a matter of law. A patent that fails to name the correct inventors may be ruled invalid under certain circumstances.
- A lawful inventor is one who makes an inventive contribution to one or more of the patent claims that formally define the invention. Someone who solely provides equipment, space or money, no matter how critical to the development of the invention, is not an inventor. Also, someone who performs work under the supervision of another party is not an inventor, even though that person may have worked long hours or conducted a critical experiment.
- Because patent claims may change as the patent application is being drafted and also while it is undergoing prosecution by the patent office, inventorship may change as well.
- For the purposes of filing your Technology Disclosure Form with the OTMA, simply name as inventors any individuals who have made a creative contribution to the invention (a creative contribution may include contributing a seminal idea towards the conception of the invention or overcoming a technical hurdle in the reduction to practice of the invention). The licensing professional whom you contact regarding your invention can provide you with a brief description of inventorship and a few relevant guidelines. More information also can be found on the OTMA website. When necessary, the OTMA will initiate a formal inventorship determination using outside patent counsel.
- Does filing an invention disclosure with the OTMA protect patent rights?
- Filing even a formal Technology Disclosure Form with the OTMA does NOT directly or automatically protect patent rights.
- The OTMA may file a patent application after thoroughly reviewing the invention and determining if the invention meets the OTMA's business criteria. Often, the filing of a patent application will not occur until a committed licensee has been identified so that the licensee can participate in drafting the patent application but the OTMA does not always have to have a licensee in hand in order to file a patent application.
- What happens once I have filed a Technology Disclosure Form with the OTMA?
- The Office of Technology Management Director will review the Technology Disclosure Form and then assign it to an OTMA licensing professional who will also assess the invention and assume day-to-day responsibility for its management. All Technology Disclosure Forms received by the OTMA are acknowledged by e-mail giving the name of the case manager, file number, and other useful information. Please contact this person for all matters pertaining to your invention.
- The licensing professional will evaluate the patentability, "licensability" and business opportunity the invention affords and develop an IP management plan accordingly. This individual also will work with you and the other inventors to understand prior public disclosures, involved funding sources and MTAs, and the technology's commercial viability.
- If the technology appears to be a licensable invention, an IP management, licensing, and marketing plan will be developed and implemented by the licensing professional.
- Once a committed licensee is identified, the licensing professional will be responsible for negotiating and drafting the license to the technology. An exclusive patent license can, for example, range from 30-50 pages and must pass independent legal review by UC's Office of the General Counsel. Often, it is at this point that a patent application is first drafted so that the licensee can participate in drafting the patent application, but it is not always necessary for the OTM to have a licensee in hand in order to file a patent application.
- Under what circumstances will OTMA finance the filing of a patent application?
- The OTMA operates as a business and has specific business criteria that each invention must meet before the OTMA will invest University funds in filing a patent application. Over its lifetime, a U.S. patent application can cost roughly $30,000, and often more, and the foreign equivalent can cost, over its lifetime, up to $200,000 or more (possibly as much as around $500,000). Thus, deciding to file a patent application worldwide can trigger a substantial investment commitment on the part of the OTMA.
- The OTMA seeks to recover its investment by licensing the patent rights to competent, committed, commercial developers. Failure to secure a licensee causes the OTMA to incur a significant financial loss and results in wasting campus funds that could have been better spent on research and education.
- The OTMA's objective thus is not to file patent applications for the sake of filing patent applications, not only because of the high cost of patent protection but also because not every patentable invention is licensable. Also, not every invention must be patented in order to be licensed. Rather, the OTMA's objective is to file patent applications strategically in order to maximize the value of those inventions that the OTMA has determined are licensable because they represent a sound business opportunity and will afford a licensee a competitive advantage in the marketplace.
- In order to best manage the costs and risks inherent in patent applications, the OTMA typically will not file a patent application until it has first found a committed licensee, and then it will file the patent application at the licensee's expense. In this way, the OTMA minimizes its financial exposure, conserves campus funds for research, and patents those inventions with true commercial potential as demonstrated by actual market demand. In addition, this strategy allows the licensee to participate in drafting the patent application so that the patent claims better support the licensee's specific business needs. By providing greater value to the licensee in this fashion, the OTMA captures more value from the licensing opportunity in the form of more favorable financial terms.
- In some circumstances, the OTMA will file a patent application "at risk," i.e. without having first found a licensee to pay patent costs. Such filings are usually prompted by an imminent public disclosure of an invention that would result in the loss of foreign patent rights unless a U.S. patent application is filed prior to the enabling public disclosure. The OTMA will make an at-risk filing if its business analysis of the invention leads the OTMA to believe there is an excellent probability that a future license will result. Such analyses take months when done properly so it is imperative that you discuss your invention with the OTMA well in advance of any public disclosure. Waiting until the last minute deprives the OTMA of the opportunity to do a proper analysis, is counterproductive, and can result in a faulty analysis due to lack of time.
- Importantly, many technologies, including tangible materials such as cell lines, transgenic mice, plasmids, and integrated circuit masks, are licensable without requiring a patent application. Also, software can be licensed under a copyright license, and a copyright license for high quality, value-added software can be more lucrative than some patent licenses.
- In summary, the substantial expense of obtaining patent rights is only justified when the patent rights are demonstrably valuable to a potential licensee who wants to license those rights. The licensing professional will determine whether and when the filing of a patent application is appropriate in order to commercialize the invention. Typically, a potential licensee accepts responsibility for reimbursing the University for patent costs before the patent application is filed. Patent rights are most important when a licensee requires market exclusivity in order to justify the risk and expense of developing a product based on the invention.
- I am currently working on a research project that may be commercially attractive. How do I apply for a patent?
Please refer to the relevant questions above. The following summary is provided for your convenience:
- Contact the OTMA as soon as you have an invention in hand. This contact should occur well in advance of the drafting of an abstract or manuscript or any public presentation.
- You may be asked to file a formal Technology Disclosure Form with the OTMA (found on the OTMA website).
- As a condition of your employment with the University, you must assign your rights to The Regents of the University of California through the Technology Disclosure Form.
- The technology is an asset that belongs to the State of California, which has authorized the OTMA to manage the technology on the state's behalf.
- The OTMA will determine whether the technology meets the OTMA's investment criteria and hence whether or not a patent application should be filed. A formal disclosure does not provide an automatic patent application filing. The disclosure simply informs the OTMA of your invention so that the OTMA can evaluate it and determine the next steps.
- Not all patentable inventions are licensable. The OTMA files patent applications only for inventions it determines will be likely to be licensed. Nationally, roughly 20-25% of university inventions get licensed (including inventions that are unpatented).
- Patent applications generally are filed only after a committed licensee is identified, but the OTMA does not always have to have a prospective licensee in hand to file a patent application.
- Once an invention is licensed and income is generated, the inventors will receive, in total, 35% of the net licensing income, as provided under UC's patent license policy.
- The OTM decided not to file a patent application on my invention and I disagree with its assessment. What recourse do I have?
- The OTMA will allow you to file the patent application at your own expense using a law firm that has been approved by The Regents of the University of California. The invention remains the property of The Regents and OTMA will manage the patent prosecution at your expense. If the OTMA finds a licensee, it will reimburse you your full costs and provide you with your share of the license income, as per the UC patent license policy.
- Alternatively and at your request, the OTMA may agree to assign its rights in the invention back to you, making the invention your personal property subject to certain terms and conditions. They include the restrictions that you cannot do any further work on the invention using University resources and that you must keep the OTMA apprised of your diligent efforts to commercialize the technology. Moreover, you will be responsible for filing the patent application, marketing, and licensing the invention all at your own expense with no participation from the OTMA.
- If the University licenses my invention to a company, will I still be able to perform related research?
Yes. Our license terms always retain the right for the University to use the invention for its own educational and research purposes and also to share the invention with investigators at other not-for-profit institutions for their research and education purposes.
- What is a "public disclosure"?
- Any of the following may be considered a public disclosure:
1. Information discussed in a non-confidential setting with non-UC employees
2. Web posting
3. Oral presentation away from the University of California or a presentation at the University attended by non-UC employees
4. Poster presentation at the University or elsewhere
5. Abstract publication, available to the scientific public or meeting attendees either in print or online
6. Manuscript publication, including online publications prior to the journal's hardcopy release
7. Thesis submission to a library or outside source
8. Thesis publication
9. Funded grant application – the NIH posts the title and abstract online and makes the application available in response to a Freedom of Information request.
10. etc.
- A public disclosure immediately bars one from obtaining patent protection in most foreign countries on such work if the disclosure is "enabling."
- An "enabling" public disclosure is one that describes the invention in sufficient detail such that one of "ordinary skill in the art" could reproduce the invention without undue experimentation. However, not all public disclosures are enabling in which case those disclosures do trigger a loss of foreign patent rights.
- In the United States, an enabling public disclosure establishes a one-year grace period from the date of the disclosure during which time a patent application can be filed. If no application has been filed within this one-year period, U.S. rights are lost.
- Many companies are not interested in licensing inventions for which no foreign patent protection is available. Also, depending on the invention, many companies are not interested in licensing the patent rights unless they can get a license well in advance of the public disclosure in order to have lead time over their competitors. Therefore it is imperative that you disclose your invention to the OTMA as soon as you have it in hand.
If you are uncertain if a disclosure will be considered an enabling public disclosure, please contact the OTMA.
- I have filed a previous invention disclosure with the UC Office of Technology Transfer (OTT) in Oakland. Does this mean that all further intellectual property issues should be handled through that office?
The UC system completed its technology transfer decentralization initiative which means that all UCSF inventions (past, present, and future) are managed by UCSF's campus Office of Technology Management and Advancement. Direct all questions you have regarding invention disclosures you filed with the OTT to the OTM.
- I am thinking of starting a company that will focus on the technology developed in my lab. Should I contact anyone at the University?
- As for any invention developed at UCSF, as a condition of your employment, you have an obligation to contact the OTMA to disclose your work and to assign your rights in the invention to the University. The OTMA will manage the invention on behalf of the University.
- The OTMA will also discuss with you the impact of founding a company on your ability to receive research funding from the company or the NIH for work at UCSF that will be related to the company's business interests.
- By mentioning your company is interested in licensing the rights to this invention, you put yourself in conflict with the California Political Reform Act of 1974. The OTMA has procedures (below) it can implement that will mitigate this conflict and provide a safe harbor for both you and the OTMA regarding the licensing decision.
- The licensing professional contacted will ask you to file a formal Technology Disclosure Form with the OTMA.
- As an inventor, you will receive, along with the other inventors, in total, 35% of any net licensing income generated from the licensing of this invention, as determined under UC patent license policy.
- The licensing professional handling your case will determine the appropriate licensing strategy for this technology which may or may not include licensing to your start-up. The licensing professional has an obligation to seek the best means to commercialize the invention for the benefit of the public.
- If the licensing professional decides to license the invention to your start-up company, before doing so the licensing professional must first market the invention so that the public is made aware of the licensing opportunity. If no companies express interest, then the Office of Technology Management Director can issue the license to your start-up. If one or more companies express interest in a license, then the licensing professional has to determine if your start-up will be the preferred commercial development partner. If your start-up is deemed superior, then the licensing professional must then submit his/her decision to an independent and substantive review that the OTMA typically outsources to another UC campus technology transfer office. If the independent review supports the OTMA's assessment, the OTMA is allowed to license your start-up. In this case, neither you nor the other UC inventors can represent the company in negotiating license terms with the OTMA due to a conflict of interest because you and they will derive personal income as UC employees from the license. Therefore, you should retain the services of legal counsel experienced in high-technology transactions to negotiate with the OTMA.
- Above all, realize that your relationship with the OTMA is just as critical to the success of your new venture as is your relationship with your investors and you should accord the OTMA the same care and respect. Without either one, you have no company. You need the OTMA to create and maintain the patent protection you need to attract investors and key employees, and to issue to your company the license that enables the company to practice your invention, without which the investors have no incentive to invest. Your reliance on the OTMA does not end with the issuance of the license. Your company will have specific obligations to meet under the license, such as meeting certain technical, financial, and business milestones and filing progress reports on a regular basis to demonstrate diligence in commercializing the licensed technology. Failure to meet any of these obligations is grounds for the OTMA to terminate the company's license for non-compliance, which could in turn devastate your business and alienate your investors. Therefore, you should regard the OTMA as a valued business partner and treat it accordingly. It is in your best interest to form a close working relationship with the OTMA at the very outset (even before talking to investors) and to nurture that relationship throughout the term of the license. Timely, candid communication is key, and keeping the OTMA at arm's length is in neither party's best interest. Should your company falter and have difficulty meeting the requirements of the license, if you and your company have invested wisely in their relationship with the OTMA and have kept it informed of the company's progress, the reasons for its ups-and-downs, and its plans to take corrective action, the OTMA, at its sole discretion, may elect not to terminate the license if it feels the company has been a diligent and valued business partner.