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May 29, 2008

Tech transfer office helps innovators

Pitt’s technology transfer efforts are centered in the Office of Technology Management, which helps innovators find commercial applications for their discoveries. OTM’s strategic relations manager Dan Bates puts it another way: He says the office’s job is about “getting your ideas out into the world.”

Bates and technology marketing manager Carolyn Weber offered information for innovators — including words of caution aimed at avoiding missteps that could jeopardize the value of a discovery — in a recent workshop sponsored by Human Resources.

Today’s technology transfer efforts in American universities stem from the 1980 Bayh-Dole Act, which aimed to get federally funded research into the hands of the public that paid for it. Driven by Bayh-Dole, universities are generating revenue through licensing, developing marketable products based on their research and disseminating new knowledge to benefit society, Bates said.

According to the Association of University Technology Managers’ most recent figures, in 2005 tech transfer efforts nationwide resulted in 527 new products, 628 new start-ups and 4,932 new licenses.

Innovations that stem from university research not only benefit the marketplace, but also can yield financial rewards for the creator and his or her department or center. At Pitt, after expenses have been paid for patented or copyrighted innovations, the inventor is entitled to 30 percent of the proceeds and his or her department gets 15 percent. Pitt’s patent rights fund gets 30 percent, OTM gets 15 percent and the University Development Fund gets 10 percent.

The process at Pitt starts by filing an invention disclosure outlining basic details on the innovation online with OTM, then proceeds to an evaluation by the technology transfer committee and, if approved, patent protection and the ultimate licensing of the innovation.

Innovator activity at Pitt is growing, Bates said, noting that invention disclosures have risen from 91 in 2002 to 246 in 2007. Of last year’s disclosures, 141 were pursued, he said.

The number of licensing and options agreements — the actual deals Pitt has made with companies for its intellectual property — has grown from 33 in 2002 to an average in the 50s during each of the past four years.

Among the trends Bates is seeing is an increase in the number of students named on invention disclosures submitted to the University.

Bates cautioned that an invention disclosure is not a patent application and that it does not protect an innovator’s invention. “It just alerts us it’s there, to allow us to decide on filing a patent disclosure,” he said.

He said it’s crucial to file for patent protection before making any public disclosures in order to preserve foreign patent rights, which are important to companies that operate in the global marketplace.

Weber noted that an invention disclosure should be filed as early as possible and definitely before there has been any public disclosure of the work. (Faculty or lab meetings, confidential submissions to publications prior to acceptance, unfunded grant applications and confidential interactions with research collaborators are not considered public disclosures.) It often is convenient to submit invention disclosures at the same time a journal article on the innovation is submitted for publication, she said. “It’s really important to talk to us first.”

Weber noted, for instance, that grant applications are private, but once they are funded, they are posted online and become public disclosures. A public disclosure — in the form of a publication, presentation, student thesis, discussion outside the University or an abstract of a funded grant applications — could cost an inventor all foreign rights to the intellectual property. That could be a huge loss, particularly in the case of a drug or other product in which a global market is crucial.

Weber advised innovators to protect themselves by using confidential disclosure agreements (CDAs) before talking with outsiders, adding that standard agreements are available on the OTM site. Material transfer agreements (MTAs) should be used for materials being shared in research, she said, adding that the Office of Research facilitates MTAs and Pitt’s intellectual property attorneys will negotiate the terms. She cautioned inventors to be wary of MTAs from outside sources in which rights could be signed away inadvertently in the fine print.

She also urged inventors to be sure to keep good lab notes, advocating good old-fashioned bound paper notebooks — the kind in which a missing page would be evident, instead of a spiral bound book. Electronic notebooks may be handy, but might not stand up if a legal question arose as to the timing of an innovation. She also advised innovators to have someone else countersign all lab records and, if information is pasted into a lab notebook, that the signatures span both the pasted-in material and the page itself.

Once an invention disclosure is submitted, OTM assigns the innovator a license manager and Pitt’s technology transfer committee (TTC), a group of administrators and faculty, determines whether the University will pursue the process of patenting or copyrighting the innovation.

Pursuing the patenting process involves tens of thousands of dollars (or even hundreds of thousands, if foreign patents also are pursued).That forces TTC to make many decisions in the early stages of the process, Bates said.

At one time, the University patented intellectual property indiscriminately, which left it with a shelf full of patented, but not very marketable, innovations. Today, Pitt is more selective about which ideas it pursues, Bates said.

The committee can opt to approve, hold (for additional information) or release the innovation (to allow the innovator to move it forward on his or her own).

The group considers whether there is a market for the innovation and whether it is protectable by a patent. Not every innovation is. Without that, commercialization can’t go forward, Bates said. “Companies won’t pay to license it.”

If the University decides to protect the innovation, its ultimate goal becomes to license the innovation to an established company or start-up , retaining ownership of the intellectual property. Along the way, OTM assists with business development and marketing, creating a strategy for moving ahead with commercialization, Weber said.

She noted that OTM has partnerships with Pitt’s graduate and undergraduate business schools to assist with market research and with the Swanson Center for Product Innovation for prototype development. OTM also has connections with community partners that can provide venture capital and other resources.

OTM markets available innovations in a variety of ways. A list of Pitt’s intellectual property that is available for licensing appears on the OTM site. OTM representatives also host events to connect inventors with potential licensees or funding sources and create marketing slicks that feature information on both the innovations and the inventors that can be distributed at shows and conferences.

OTM has even developed a wallet-sized “commercialization coaching card” of tips that innovators should keep in mind when trying to attract interest in their ideas.

While innovators vary in how involved they want to be in the marketing of their ideas, they can play an important role, Bates said, noting that some 70 percent of leads for potential licensees come from the innovators themselves.

There are some limits to the role innovators may play in commercializing an idea. They are permitted to hold only a limited amount of equity (20 percent) in a company that is licensing their idea. They may conduct sponsored research, consult or even serve on an advisory board for licensees. But they may not serve as PI for sponsored research or be in a management or decision-making position (such as a member of the board of directors) for a licensee of their intellectual property, Bates said.

OTM also offers programs for academic entrepreneurs, including its 10-week “From Benchtop to Bedside” course that outlines the commercialization process.

Citing Pitt’s position among the top research institutions, Bates said “There’s lots of research going on, lots of ideas floating around. We’re trying to find better ways to capture them and get them out into the world.”

—Kimberly K. Barlow


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