Research at Stanford often results in intellectual property that may be protectable under patent, copyright or trademark laws. Stanford faculty, staff and students have certain responsibilities to the University regarding intellectual property and the University provides resources to help transfer Stanford technology for the public benefit. The Office of Technology Licensing (OTL) is responsible for managing intellectual property developed at the University through formal licensing. Some examples of inventions, products and companies created based on research at Stanford can be found here.
The Office of Technology Licensing
The Office of Technology Licensing (OTL) is responsible for managing the intellectual property assets of Stanford University. OTL receives invention disclosures from Stanford faculty, staff and students, evaluates each disclosure for its commercial viability, and when possible licenses it to industry. Patentable inventions constitute the majority of OTL's licensing activities. They also handle copyright (software and other creative works), Tangible Research Property (such as biological materials), and outgoing Material Transfer Agreements for biological materials.
Stanford PIs, their students and other research staff must disclose all potentially patentable inventions conceived or reduced to practice in whole or in part in the course of University responsibilities or with more than incidental use of University resources. These potentially patentable inventions need to be disclosed on a timely basis so Stanford can fulfill its obligations both to the federal government under the Bayh-Dole act and to other companies or organizations that sponsor research at Stanford. Stanford is usually required to report inventions to the sponsor, whether or not those inventions are considered patentable. Title to the inventions is assigned to the University regardless of the funding source. Title to copyrightable works developed with significant use of University resources is also assigned to the University.
Inventors and creators may place inventions in the public domain if they believe that it would be in the best interest of technology transfer and if doing so is not in violation of the terms of any agreements that supported or related to the work.
Types of Intellectual Property
Innovations developed at Stanford may be eligible for intellectual property protection depending on the nature of the technology. Different types of intellectual property are treated differently under Stanford policy.
Patents are generally used for compounds, methods and devices that are new, useful and non-obvious. They are subject to the Research Policy Handbook procedures on Inventions Patents and Licensing.
Copyrights are used for creative works such as software, literary works, photographs and musical compositions. They are subject to the Research Policy Handbook procedures on Copyright.
Tangible Research Property (TRP) can be successfully licensed without formal intellectual property protection. TRP can include biological materials, engineering drawings, computer software, integrated circuit chips, computer databases, prototype devices, circuit diagrams, equipment, and associated research data. It is subject to the Research Policy Handbook procedures on Tangible Research Property.
Trademarks are symbols, or words established by use or legally registered as representing a company or product. Stanford trademarks are managed by the director of business development, not OTL. Trademarks are subject to the Research Policy Handbook procedures on Other Intellectual Property.
OTL Technology Transfer Process
This is the typical process for most inventions disclosed to OTL. Each step is explained in greater detail in OTL's Inventor's Guide.
Observations and experiments during research activities often lead to discoveries and inventions. An invention is any useful process, machine, composition of matter (e.g., a chemical or biological compound), or any new or useful improvement of the same. Often, multiple researchers – including trainees and research staff – may have contributed to an invention and may be inventors.
2. Invention and Technology Disclosure
This written notice of invention to OTL begins the formal technology transfer process. The Invention and Technology Disclosure (also known as an invention disclosure) is a confidential document, and should fully describe the new aspects of an invention, including the critical solution it provides and its advantages and benefits over current technologies.
OTL will review the invention disclosure, conduct patent searches (if applicable), and analyze the market and competitive technologies to assess the invention’s commercialization potential. The assessment process will guide OTL's licensing strategy – for example, to license exclusively or non-exclusively, or to license the invention in different fields of use.
4. Intellectual Property Protection (if appropriate, necessary, or warranted)
Patent protection, a common legal protection method, begins with the filing of a patent application with the U.S. Patent and Trademark Office and, when appropriate, foreign patent offices. Once a patent application has been filed, it will require several years and tens of thousands of dollars to obtain an issued patent. Other commonly used forms of intellectual property protection include copyright and trademark. Unique biological materials and software can often be successfully licensed without formal intellectual property protection.
Stanford is committed to broadly marketing all technologies to appropriate companies that could be interested in commercializing the particular invention. With the inventors' input, OTL will create a marketing overview of the technology, and identify and contact candidate companies (potential licensees) that have the expertise, resources, and business networks to bring the technology to market.
6. Selecting the Best Licensee(s)
If there are several parties interested in a license, OTL will endeavor to license non-exclusively or grant field-of-use licenses, if possible. If it is not possible to accommodate all interested parties, OTL will license the company most committed and able to bring the technology to the marketplace. Typically, there is only one interested party or none at all.
OTL negotiates and executes a license agreement. This agreement is a contract between the University and a company in which certain University rights to a technology are granted to a company in return for financial and other benefits. An option agreement is sometimes used to allow a company to evaluate the technology for a limited time before a formal license agreement is concluded.
Most university inventions are very early stage and require further research and development efforts. The licensee company typically makes significant business investments of time and funding to commercialize the product or service. This step may entail regulatory approvals, sales and marketing, support, training, and other activities.
Royalties received by the University from licensees are distributed according to policy to inventors, departments, and schools to fund additional research and education. Royalties include both cash and equity received from licensees in consideration for granting the license.
Royalties shared throughout the University collectively foster the creation of the next generation of research and innovators.
Benefits of Licensing and Technology Transfer
About a quarter of the technologies disclosed to OTL are licensed and generate royalty income that is shared according to Stanford Policy with the inventors, their schools and their departments. Licensing proceeds also support the OTL Research and Fellowship Fund (administered by the Vice Provost and Dean of Research) and the Vice Provost for Graduate Education/OTL Graduate Education Fund (administered by the Vice Provost for Graduate Education). These financial returns benefit the individual inventors and support the next generation of research and innovation at the University.
Beyond royalties, the relationships built through licensing foster other forms of technology transfer through informal scientific exchanges with industry and enriching experiences for students who enter the workforce. And, when our industry partners commercialize products and build companies based on Stanford technologies, these can create a better world for all of us.
Best Practices for Startups
Innovation and the translation of inventions into products that serve the public are deeply ingrained in Stanford’s culture and we have benefited greatly from it. Stanford is supportive of faculty and students becoming inventors and starting companies – whether or not these companies are based on Stanford technology. In addition, Stanford is committed to avoiding either perceived or actual conflict of interest issues with respect to start-ups. Both Stanford and its entrepreneurs have responsibilities to optimize technology transfer and mitigate conflict of interest (COI) when licensing Stanford intellectual property to a start-up is considered.
OTL makes licensing decisions based on it’s professional judgment about how to achieve the best possible benefit to the public, without inappropriate influence from internal or external parties. For more information please review the these documents:
Best Practices for Student Entrepreneurial Courses October, 2011