The benefits of technology transfer are nothing new to innovators across a wide range of industry sectors. But as the purse strings tighten in higher education and entrepreneurial businesses struggle to raise finance, effective intellectual property (IP) management is increasingly critical in realizing the commercial potential of technology-based inventions.
By managing IP matters effectively from the outset, innovators involved in technology transfer can future-proof their product development strategy, and increase their chances of securing investor support or opening the door to other potentially lucrative commercial opportunities.
It is not unusual for scientists within research-based companies and University research departments to want to spend their time discovering the next scientific breakthrough and how to apply it, rather than how to optimize any commercial gain. However, experienced technology transfer teams are usually on hand to take the commercial reins; advising on everything from future sector-based applications for the new technology, to the formation of a spin-out company or signing a licensing contract.
The commercial route of choice for innovators involved in technology transfer is constantly shifting and depends on the strength of the economy and the level of business confidence. During the dot-com boom in the late 1990s, when finance was much easier to come by and business valuations were particularly strong, technology transfer teams favored setting up companies. When the bubble burst in the early 2000s, however, the licensing model was favored once more. Today, both business models are likely to be considered, although recent reports about technology stock valuations rising again could encourage more spin-outs.
While decisions are taken about which business model to pursue, research scientists are of course keen to pursue their work and it is important that all early stage innovations are protected. During the incubation process it is usually advisable to file patent applications as soon as possible and make regular updates to the application during the first 12 months. In some instances it is possible to re-file the application, thus providing a kind of rolling patent protection based on a series of potential applications. These patent applications can then be wrapped up into a single patent application, filed under The Patent Cooperation Treaty (PCT), effectively securing a further 18 months of patent protection in more than 140 countries on top of the initial year, for relatively low cost. The PCT application process provides up to 2.5 years of leeway for development work to continue before the potentially-expensive decisions about seeking foreign market protection are required.
Patent mapping activity can also be used to support longer term business plans as they are developed by technology transfer teams and their investors. For example, by mapping the number of patent applications filed in a particular field it is possible to begin to make judgments about whether it is worth focusing R&D resources in one area more than another.
Zircotec, a developer of high performance coatings and related products, is one example of a business that started life as a spin-out company. Since 2008, the business has filed patent applications crossing a number of industry sectors including automotive and aerospace and defence. As well as focusing on seeking patent protection for new technologies, the company's patent strategy aims to allow room to explore their use in other applications and markets.
At a time of significant cuts in higher education funding and reduced leveraged finance for deal-making, technology transfer teams will be under growing pressure to find new ways to bring new technologies to market as quickly as possible. For example, some technology transfer teams are choosing to establish open innovation partnerships with established businesses that already have the necessary operational or production facilities, on the basis that the profits generated as a result of any output are owned by the partner for a limited period of time.
More creative thinking around commercialization and innovation partnerships requires more care when it comes to IP management. In the case of open innovation partnerships, it is important to ensure that all parties understand and agree where IP rights produced from the partnership will sit.
Technology transfer has always been a difficult balance between the need to strike a commercially attractive deal and the need to protect the research institution's investment in R&D. Challenging economic conditions just means that those tasked with technology transfer must be more creative in their approach both to commercialization and to IP ownership.