Table of Contents
- Why license?
- What can be licensed?
- What sort of technology should be protected, and how?
- Can we license technology which is not used by us?
- Can we license technology that is not fully developed?
- What if my licensee improves my product to become more competitive?
- What issues arise with respect to rights to the technology?
- How can we value the technology?
- What is TLG's fee structure for its services?
Why license?
Licensing should be an integral part of any marketing/business strategy. Not only does licensing represent an opportunity for added income, it can also provide an avenue for product improvements through grant back and flow back rights. A well-designed licensing program can also increase market share by access to otherwise closed markets. Very often the licensee becomes an important customer.
Technology transfer can provide the consideration for a joint venture or alliance.
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What can be licensed ?
Intellectual property, which can include patented or unpatented information, trade secrets and any data not generally known to the public. It can relate to an entire product or assembly or to a small part. It can be the "key" that makes a process work, or the knowledge of what doesn't work. In other words, just about any technical information of value.
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What sort of technology should be protected, and how?
It's wise to safeguard all proprietary information and data used in the company's business or which otherwise has value.
Secret information can be protected by maintaining the information as secret and by use of secrecy agreements when called for. Employee confidentiality/invention agreements are very common. Patents and copyrights afford another form of protection, but the expense, obligation to disclose and limited nature of a patent should be considered. A careful analysis is necessary. Having a patent attorney on the team making the decisions is recommended. (TLG does not offer legal or patent advice)
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Can we license technology which is not used by us?
Although a proven product or process is much easier to demonstrate, unused technology can be a major source of income.
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Can we license technology which is not fully developed?
If the technology is "state-of-the-art" and has
significant merit, particularly if proof of concept has been demonstrated and a
patent application has been filed, a potential licensee that is willing to fund
completion of development in return for an exclusive license option can often be
identified.
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What if my licensee improves my product to become more competitive?
The license agreement can be written with provisions for "flow back" so that your licensee furnishes you with the details of his improvements and if you wish you can incorporate these into your product also.
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What issues arise with respect to rights to the technology?
Unfortunately, the most valuable technology is sometimes tied up, or even gives rise to third party liability, if title to the technology is unclear. Conflicts have arisen in the past as a result of funding from third parties, including government agencies, joint R & D, or use of contract engineers without a clear rights contract. Providing technical data to others without a confidentiality obligation, or accepting information without a negation of a confidential relationship has also led to problems. It is never too early to consider the long term plan for the technology.
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How can we value the technology?
There are many tests that are traditionally used, including development costs, market potential, loss of market share, value to the licensee of early market entry, and so on. But a knowledge of what the market will bear is invaluable.
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What is TLG's fee structure for its services?
Generally, we are paid on an hourly basis for work performed, plus reimbursement for out-of-pocket expenses.