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History, Status, and Trends for Technology Transfer in U.S.
Universities & The Stanford Model
Presentation by Jon Sandelin
Stanford University
Office of Technology Licensing
http://otl.stanford.edu
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Presentation Areas
Methods of Technology Transfer Evolution of University T/T in the U.S. Role of Bayh/Dole and AUTM Current Status of University T/T in U.S. Evolving Trends in the U.S. Types of Industry-University
Relationships at Stanford University
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Methods of Technology Transfer
Graduated Students Publications Conferences Visiting Scholars/Industry Visitor Programs Industrial Affiliates Programs Research Sponsorship and Faculty Consulting Licensing to Established Companies and to
Start-Up Companies
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Stanford Office of Technology Licensing
Our mission: to promote the transfer of Stanford technology for society's use and benefit while generating unrestricted income to support research and education
Founded in 1970; $55k Royalties 1st Yr To Date: 4,950 Invention Disclosures;
1,320 Issued Patents; 2200 Licenses; $552M in Royalties ($255M from C/B)
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OTL FY2002 Results
295 Invention Disclosures $52.7M in Royalties
– high of $61.2M in FY1998– $0.4M from Sale of Equity
111 Licenses Granted; 13 Start-Ups Office Budget of $2.6M; Staff of 25 $3M for Legal Fees ($1.5M reimbursed)
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OTL Start-Ups
115 to date; with 75% in last 5 years 45% Medical; 35% Software/IT; 10%
Sensors; 10% Other: Equity in 80% 9 (so far) have failed 15 (so far) Equity Sold for $22 Million
– Abrizio (PMC-Sierra) = $9.7 Million– Amati (Texas Instruments) = $8 Million– Vxtreme (Microsoft) = $0.8 Million
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Stanford Policies
Ownership of Intellectual Property– With University if:
• Part of University work responsibilities; or
• More than incidental use of University Resources
Income/Equity Sharing– Royalties: 15% to OTL, then 1/3 each to
Inventors; Inventors Dept; Inventors School– Equity: 1/3 to Inventors; 2/3 to Special Fund
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Start of Licensing Activity
1920s: Wisconsin Alumni Res. Fdn. 1930s: Iowa State Patents Foundation 1940s: MIT; Kansas State Res. Fdn. 1950s: University of Minnesota 1960s: University of Utah; Salk Institute; 1969: Stanford University 1970s = 15; 1980s = 82; 1990s = 73
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Historical Events
1907: UC Berkeley; Cottrell Patent 1912: Research Corporation founded by
Frederick Cottrell 1925: University of Wisconsin;
Steenbock Patent; Formation of Wisconsin Alumni Research Foundation
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More Historical Events
1927/29: Harvard University; Minot and Murphy invention; Committee Study; Decision not to patent
1951: MIT; Forrester Patent; RCA Interference; Royalties in 1960/70s
1969: Reimers launches Stanford TLO under Marketing Model; Cohen/Boyer $
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Evolution of Patenting & Licensing in U.S.
Before 1980 - few U. S. Universities were involved with Patenting & Licensing
1980 - Bayh/Dole Law enacted 1980 to 1990 - SUPA/AUTM facilitates
convergence on Best Practices 1990 to 1999 - AUTM Annual Surveys
document Rapid Growth in University Licensing Results
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Bayh/Dole Law of 1980
Option to Ownership of Government Sponsored Inventions (2 Years or 90 Days before Patent Bar Date)
If Option Exercised, Must Patent and Diligently Seek a Licensee
Must Share a Portion of Royalty Income with Inventors Non-Exclusive Royalty-Free License to Government Government Retains March In Rights Preference to Small Business (under 500 employees) U.S. Manufacture if Exclusive License in U.S.
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Association of University Technology Managers
Formed in 1974 with 20 Members; Over 3000 Today Becoming an International Association Publications: Directory; Newsletter; Technology
Transfer Manuel (3 Volumes); Journal; Educational Series; Annual Survey
Meetings: Regional; National (Orlando in Feb, 2003); International
Courses: Fundamentals of Licensing; Advanced Topics; Start-Up Business Formation; MultiMedia
Information at: www.autm.net
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2000 AUTM Survey
$1,260 Million in Royalties $60 Billion in Licensed Products Sales 400,000 new Jobs 13,032 new Invention Disclosures 6,375 new Patent filings 4,362 new Licenses (12% to Start-Up
Companies)
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Invention Disclosures
0
2000
4000
6000
8000
10000
12000
14000
1991 1993 1995 1997 1999
InventionDisclosures
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Patents Filed
0
1000
2000
3000
4000
5000
6000
7000
1991 1993 1995 1997 1999
Patents Filed
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Licenses Granted
0
500
1000
1500
2000
2500
3000
3500
4000
4500
1991 1993 1995 1997 1999
Licenses Granted
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Royalty Income
0
200
400
600
800
1000
1200
1400
1991 1993 1995 1997 1999
Royalties inMillions USD
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University Spin-Out Facilitation
2002 - Not a Promoted Activity at many U.S. Universities, but starting to change
Where “actively” done, typically by off-campus group e.g., ARCH; WRF; BCM Technologies, C2C -- but changing
No Generally Accepted Model as yet, but AUTM reacting: Courses; Publications
More Prevalent in Europe & Canada
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Why Not Spin-Outs?
Fears of Institutional Conflict of Interest– Harvard Incident/1983 Pajaro Dunes Mtg
Labor Intensive Activity; Success in “Licensing-Friendly” Industries– Biotech; Pharmaceutical; Medical Devices
Limited Invention Disclosures with Start-Up Company Potential (but changing)
Few “Success” Stories (also changing)
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Trends in the U. S.: Federal Government
Promotion of University/Industry Collaboration– 1980 Bayh/Dole, Etc.– Advanced Technology Program (ATP)– STTR (SBIR extension to include Universities)
Promotion of Federal Labs/Industry Collaboration– 1986 Federal Lab Technology Transfer Act
Tax Incentives to Entrepreneurs
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Trends in the U.S.: Industry
Away from Basic Research and to Product-Connected Research
Downsizing of R&D Depts; PhD Graduates to Small Companies and Start-Ups
Acquisition as a Sourcing for New Products Growing Acceptance of Licensing
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Trends in the U.S.: Universities
Industry-Influenced Research– Affiliates/Super-Affiliates Programs– Inter (or Cross) Disciplinary Research Centers– Multi-Company Research Collaborations
PhD Graduates to SME’s and Start-Ups Alliances with Overseas Universities
– MIT/Cambridge; Stanford/Edinburgh; UC/Germany
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Trends in the U.S.: TLOs
Licensing of Spin-Out/Start-Up Companies– “Qualifying” Inventions for Start-Up– Networking of Angel Investors– Concept2Company and Others
Invention Enhancement Funds Licensing in the Physical Sciences
– Portfolio Licensing with Very Low or No Earned Royalties
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Trends in the U.S.: TLOs (2)
Industry Donation of Patents to TLOs Marketing over InterNet New Forms of License Agreements
– Ready-to-Sign License Agreements– Hybrid Agreements
(Patent/Copyright/Trademark)– “Package” Deals (Research/License/Consulting)– Equity only License Agreements
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Trends in the U.S.: TLOs (3)
More Option Agreements More Licensing of Tangible Research Products Use of “Plain Language” in Writing
Agreements Loss of Staff to Industry/Training of New Hires Time Spent on Conflict of Interest/Commitment
Issues
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Types of Industry-University Relationships
Sponsorship of Research Donations and Gift Funding Interdisciplinary Centers & Collaborations Industrial Affiliate Programs Licensing of University Intellectual Property Classes for Company Employees Visiting Scholars from Industry and Company Employees
teaching at University University-managed Science Parks/Incubators Faculty Consulting
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FY2002 Income from Industry
Sponsorship of Research: $42.5 Million Donations and Gifts: $34.7 Million Industrial Affiliates Programs: $17.2 Million Licensing of University I/P: $52.7 Million Classes for Company Employees: $10.4 Million Total for FY2002 is $157.5 Million
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Industry Funding by Category
020406080
100120140160180200
Ind ClassesAffiliatesLicensingInd Res SponGifts
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Different T/T Models
Legal Model
– Viewed as a Legal process
– Based in the University Legal Office Administrative Model
– Viewed as an Administrative process
– Based in existing administrative office Business/Marketing Model
– Viewed as a business within University
– Independent organization within University
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Evolution of T/T Models
1991– Legal Model: only a few– Administrative Model: Almost all– Business/Marketing Model: very few
2003– Legal Model: None– Administrative Model: Minority– Business/ Marketing Model: Majority
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Business/Marketing Model
Independent Self-Funded Unit Policies to encourage invention
disclosure and inventor involvement Hire people with entrepreneurial instincts
and business experience Empower people to make all decisions;
Cradle to Grave involvement
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THE END
Thank You for your Attention!