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LICENSING &

TECHNOLOGYTRANSFER

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What is technology

transfer?Technology transfer is the process by which a developer of

technology makes its technology available to a commercial

partner that will exploit the technology.There may be many reasons why a developer of the technology

might consider making its technology available to another person

to exploit, instead of exploiting the technology itself. Some of

these are:

.

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Forming alliances with partners that can progress the

development of the technology to take it to market

Forming alliances with partners with manufacturing

capability.

Forming alliances with partners with marketing and

distribution capability.

Exploitation in a different field of application.

No commercial capability

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How does technology transfer take

place?

Technology transfer in this, way takes place by creatinglegal relationships by which:

(i) the owner of technology, or (ii) the holder of

licensed rights to exploit the technology, grants newrights of exploitation to the technology transfer

partner.

These legal relationships are contractual in nature.

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This means that legal agreements are entered into bywhich:

1. the right to exploit the technology is granted by thetechnology owner or rights holder, to the technologytransfer partner that will exploit the technology.

2. the technology owner or rights holder is compensated,usually financially, for the grant of those rights.

3. the respective rights duties and obligations of theparties that will govern their legal relationship are setout.

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What the main contractual agreements by which

technology transfer takes place?

The principal mechanisms by which technology transfer takes place and the

types of legal agreements used to record these mechanism are:

1. Confidentiality Agreement

A Confidentiality Agreement regulates the terms of disclose of confidentialinformation by one person to another.

2. Material Transfer Agreement

A Material Transfer Agreement regulates the terms upon which biologicalmaterial is provided by one person to another.

A Material Transfer Agreement has similarities to a Confidentiality Agreement.

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3. Deed of Assignment

By a deed of assignment, the technology owner transfers or assigns its

property.

The technology owner in this way is divested of all ownership of the

intellectual property, and along with that, is divested of all future interest

in the intellectual property.

The assignee of the intellectual property becomes the owner of the

intellectual property. Financial compensation is paid to the former owner.

4. License AgreementBy a license agreement, the technology owner or rights holder, grants a

license or a permission to use the intellectual property, to the licensee.

The licensee by the terms of the license is permitted to exploit the

intellectual property.

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The licensee, financially compensates the licensor for the use of

the rights granted by the license.

Generally, the licensor is passive in this legal relationship.

The licensor does not necessarily further develop the intellectual

property, nor participates in its marketing, but passively receives

the financial compensation for having granted the license.

5. Strategic alliance or joint venture.

In a strategic alliance or joint venture the owner or rights holder ofthe intellectual property, partners strategically with another

organization for the development and exploitation of the

intellectual property.

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The types of legal agreements to record such strategic alliances

are:

1 Co-Development Agreement

In a Co-Development Agreement, the intellectual property is typically

licensed by the licensor to the alliance partner, and as well, the twopartners together jointly undertake the further development of the

intellectual property.

In this way the licensor seeks to continue to add value to the

development of the intellectual property, beyond just granting a

license.

By continuing to add value in this way, the licensor is entitled to

greater financial remuneration, than if the licensor had passively

granted a license and not contributed further to the development of

the intellectual property.

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2 Co-Marketing Agreement

In a Co-Marketing Agreement the intellectual property is similarly

licensed by the licensor to the alliance partner, but additionally, they

partner together to jointly market the products developed from the

intellectual property.

A licensor in this case adds value in a different way to a Co-

Development Agreement. Value adding here occurs by the alliance

partners together accessing their respective marketing networks and

resources to jointly take a product to market.

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License Agreement

An intellectual property license is a contract

by which permission is given by the licensor to

the licensee to exploit the licensors

intellectual property.

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License Agreement

A license is also a contract. It creates

contractual rights, duties and obligations

between the owner of intellectual property,

and the licensee.

It is these contractual terms, and the rights,

duties and obligations which they record, that

regulate the relationship between the licensorand a licensee in a legally enforceable way.

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Exclusivity in License Agreement

Exclusivity means the right to exclude others

from exploiting the intellectual property.

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Exclusivity licensing conditions

The essential characteristic of an exclusive

license, and which makes the license an

exclusive one, is that the owner of the

intellectual property cannot:

1. license anyone else, nor

2. exploit the intellectual property itself.

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Sole License conditions

In contrast, a sole license is one where:

1. the owner of the intellectual property

grants the license,

2. is precluded from granting a license to any

other person,

3. but retains the right to exploit the

intellectual property itself.