Random Ramblings about stuff I see going on in biotech, internet and the stuff I read.

Tuesday, May 01, 2007

Perfect Storm on Tech Transfer offices?

In my last post, I was talking about the effects of KSR on the world in general, and mentioned that I thought tech transfer offices may be about to have a bad day. Also mentioned the Medimmune case in conjunction with that.

In thinking more about that...it could be a really bad day for the universities on this front.

  • NIH budget is declining.
  • Number of researchers has been ramping up for years (due to doubling NIH budget).
  • Cost of reagents has been increasing at greater than rate of inflation
  • Researchers need money
  • Look to licensing to fill hole with money (amongst many places)
  • "Go to companies" - They are rich - take their cash
  • Obviousness bar is lower
  • Challenge to patents after taking a license is easier
  • Company may choose to may you come after them (belief in winning in court)
  • University may offer cheap license to tempt company to take license rather than a court battle.
Bias against
  • Big wins. The more money there is at stake, the more tempting that shot at the court case looks. If the universities keep their royalties down, to avoid rising to the "worth a challenge" level, they will keep their patents but they may not make very much money
  • Licenses without most favored nation clauses. I probably won't ever sign another one. If someone else challenges, I want to reap the reward of the university bribing them to back off. This will have to happen at some point.
Other predictions
  • Some University will go to court. One of them will think it can push it. I don't know if they will win or not, but it will set the tone for a lot of things. We will all watch that case VERY closely to see what happens. Much case law will be written in the next while here and it will matter a whole lot.
Ummmm....problem. Do I think this will come true? To some degree yes. I also think we will also see a lot of the fallout of their just plain being more licensing offices and more of a mandate to them to market their stuff. That leads to just plain more people chasing a money pool that isn't really growing that much. Each University will, therefor, get less cash.

As a side note to any who might think "but my University is, like, really good at licensing and we are world famous and we will totally be able to stomp out U. of Hicksville". NOT. I don't care what university you are. I need the IP. All your licenses prevent me from using your name anyway so it doesn't matter whether I license from Famous U. or U. Hicksville.

In any case - I am glad I don't run a University Tech Transfer office right now.

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