The University Record, November 9, 1992

University will help faculty develop commercial applications of research

By Sally Pobojewski
News and Information Services

The University will contribute money and manpower to help U-M faculty develop commercial applications for their research, according to Jim MacBain, director of research relations for the College of Engineering’s Office of Technology Transfer. Faculty must understand, however, that the process requires a major investment of their time and energy.

“Commercializing intellectual property is a contact sport,” says MacBain. “Faculty members must be prepared to get out there and work with their customer.”

MacBain and Mitch Goodkin, an attorney with the Intellectual Properties Office (IPO), presented a “user’s manual on technology transfer” to about 50 U-M faculty and staff and representatives from private industry who attended the second in a series of seminars on technology transfer issues held Nov. 4.

Titled “Intellectual Property at the University of Michigan: Policies, Procedures and Support Resources,” the seminar was sponsored by the College of Engineering’s Office of Technology Transfer and the Intellectual Properties Office.

The U-M is undertaking a new initiative in technology transfer, a term used to describe a broad range of activities that move university expertise and research technology out of the academic environment and into commercial applications in the private sector.

According to Regents’ Bylaws, the

U-M owns the rights to all intellectual property conceived or developed by faculty or staff that was supported by direct or indirect funds administered by the University, Goodkin explained. The U-M has three ways in which faculty can share in any financial return the U-M receives from marketing this intellectual property.

—Faculty may choose to have the

U-M process and pay for the patent application, find a commercial licensee and negotiate royalties. In this case, the inventor receives up to 50 percent of net royalties after expenses are deducted.

—With Board of Regents’ approval, a faculty member may request reassignment of the technology from the U-M to the inventor. In this case, the inventor retains a patent attorney, pays for the patent application process and negotiates licensing agreements independently. The inventor keeps 85 percent of any royalties; the U-M gets 15 percent.

—In the third option, which also requires Board of Regents’ approval, the inventor starts his or her own business, pays for the patent application, and negotiates a license with the U-M to market the technology independently. In this case, the faculty-owned business pays all expenses, keeps all profits and pays a small royalty fee to the U-M.

“IPO receives between 80 and 90 disclosure statements from faculty each year, said IPO Interim Director Anne C. Di Sante. “After investigating the patent status and market potential of the technology, we file patent applications on about 40 each year. Between six and 10 are reassigned to the inventor.”

Di Sante added that the market analysis and patent application procedure can take from two days to more than a year and cost between $5,000 and $20,000.

“Faculty can help reduce costs and speed the process by providing a clear, detailed disclosure statement with a specific description of the potential applications for the technology,” she said.

The next seminar in the series, scheduled Dec. 2, will feature College of Engineering faculty who have started independent businesses or worked with IPO to market their technology. All seminars are available on videotape. To view the tapes, contact Downs Herold, 764-5260.