Technology Transfer and Commercialization
Client Problem
Our client, a nonprofit organization which operates a major national laboratory for the National Science Foundation, sought to revitalize a flagging technology transfer (T2) and commercialization program. Following a long history of abortive attempts, characterized by frequent turnover of program management and staff, the nonprofit foundation responsible for T2 activities determined it would make one final attempt at jump starting the technology commercialization program. One severely complicating factor distinguished this technology transfer operation from those of better endowed, mission oriented national laboratories: with no support for technology transfer activities from its government sponsor, and no expense account or other mechanism to recoup the cost of the T2 program from the Federal government, this commercialization program was expected to return 50 percent of its royalty revenues to the scientific staff and programs and still turn a profit on the remaining 50 percent. To make matters more difficult, the checkered history of technology commercialization at this institution had left the scientific staff distrustful of management’s motivations and commitment to commercialization activities.
What We Did
When we began, we were confronted by a program that was in far worse shape than originally represented. With no coherent system to monitor licensees, lease negotiations, or track royalties, we found a melange of aborted license negotiations and more than one licensee who was seriously delinquent on its royalty payments. In one instance, management and staff were operating under the mistaken assumption that a license agreement with a particular firm was in force when we discovered that, in fact, prior negotiations had never been concluded and no license agreement was ever executed.
Recognizing the need to make an immediate impact, we assumed the role of interim director of the technology commercialization program and divided our efforts between quickly assessing the technology and intellectual property portfolio and building relationships with the scientific staff, licensees, and prospective licensees. We also initiated efforts to collect on the past due royalties that were owed on the existing licenses. After prioritizing the technology portfolio for its royalty revenue potential, we commenced discussions with potential licensees of the most valuable of the technologies. To further rationalize the licensing process in the minds of both internal staff and the external community, we produced a booklet of Guidelines for Licensing Proposals which was disseminated to potential licensees. For one technology that was the subject of considerable interest, we initiated a competitive bid process, receiving licensing proposals from four prospective licensees. For other technologies that were not yet ready for licensing, we initiated market assessments and worked closely with the intellectual property management and patent attorneys to secure appropriate IP protection. In one instance, we located and contacted NASA researchers working in complementary areas, thereby opening the doors to future collaborative opportunities. Finally, we also worked cooperatively with, and leveraged the efforts of, other public relations and marketing groups within the laboratory to build awareness in the marketplace of the technology transfer and commercialization opportunities at the laboratory. With their assistance, we were able to create a website describing the technology transfer opportunities at the lab.
Results
During the approximately 1ó years of this engagement, relations with the scientific staff and with external customers improved markedly, and a sense of credibility was returned to the technology commercialization program. The problems, noted earlier, with open license negotiations and past due royalties were successfully resolved. Market assessments and/or license negotiations for several other technologies in the portfolio were conducted and many were successfully concluded. In fact, during this engagement, nine royalty bearing license agreements for laboratory developed technologies were executed – more than had been executed in the entire prior history of the lab. Once it appeared that the technology commercialization effort could be self-sustaining, we transitioned out of the program and turned it over to internal personnel.
Our client, a nonprofit organization which operates a major national laboratory for the National Science Foundation, sought to revitalize a flagging technology transfer (T2) and commercialization program. Following a long history of abortive attempts, characterized by frequent turnover of program management and staff, the nonprofit foundation responsible for T2 activities determined it would make one final attempt at jump starting the technology commercialization program. One severely complicating factor distinguished this technology transfer operation from those of better endowed, mission oriented national laboratories: with no support for technology transfer activities from its government sponsor, and no expense account or other mechanism to recoup the cost of the T2 program from the Federal government, this commercialization program was expected to return 50 percent of its royalty revenues to the scientific staff and programs and still turn a profit on the remaining 50 percent. To make matters more difficult, the checkered history of technology commercialization at this institution had left the scientific staff distrustful of management’s motivations and commitment to commercialization activities.
What We Did
When we began, we were confronted by a program that was in far worse shape than originally represented. With no coherent system to monitor licensees, lease negotiations, or track royalties, we found a melange of aborted license negotiations and more than one licensee who was seriously delinquent on its royalty payments. In one instance, management and staff were operating under the mistaken assumption that a license agreement with a particular firm was in force when we discovered that, in fact, prior negotiations had never been concluded and no license agreement was ever executed.
Recognizing the need to make an immediate impact, we assumed the role of interim director of the technology commercialization program and divided our efforts between quickly assessing the technology and intellectual property portfolio and building relationships with the scientific staff, licensees, and prospective licensees. We also initiated efforts to collect on the past due royalties that were owed on the existing licenses. After prioritizing the technology portfolio for its royalty revenue potential, we commenced discussions with potential licensees of the most valuable of the technologies. To further rationalize the licensing process in the minds of both internal staff and the external community, we produced a booklet of Guidelines for Licensing Proposals which was disseminated to potential licensees. For one technology that was the subject of considerable interest, we initiated a competitive bid process, receiving licensing proposals from four prospective licensees. For other technologies that were not yet ready for licensing, we initiated market assessments and worked closely with the intellectual property management and patent attorneys to secure appropriate IP protection. In one instance, we located and contacted NASA researchers working in complementary areas, thereby opening the doors to future collaborative opportunities. Finally, we also worked cooperatively with, and leveraged the efforts of, other public relations and marketing groups within the laboratory to build awareness in the marketplace of the technology transfer and commercialization opportunities at the laboratory. With their assistance, we were able to create a website describing the technology transfer opportunities at the lab.
Results
During the approximately 1ó years of this engagement, relations with the scientific staff and with external customers improved markedly, and a sense of credibility was returned to the technology commercialization program. The problems, noted earlier, with open license negotiations and past due royalties were successfully resolved. Market assessments and/or license negotiations for several other technologies in the portfolio were conducted and many were successfully concluded. In fact, during this engagement, nine royalty bearing license agreements for laboratory developed technologies were executed – more than had been executed in the entire prior history of the lab. Once it appeared that the technology commercialization effort could be self-sustaining, we transitioned out of the program and turned it over to internal personnel.