The Commercialization Process

Following is a typical commercialization scenario, though each invention will have an individualized plan.

Determine commercial interest.
If the level of commercial interest is not known, then the commercialization plan may start with a marketing assay. Prospective commercial partners are identified in consultation with the inventor and through databases, news publications, and meetings. The KUCTC will use the Nonconfidential Description of the invention, drafted by the inventor, to describe the technology and gain the interest of prospective partners. If commercial potential is deemed significant, the patent application can proceed simultaneously with the search for a commercial partner.

Identify possible commercial partners
Negotiate with established companies or create a start-up company. Licensing to an established company or companies is the simplest and most frequent plan. In some instances, a start-up company may be formed in order to license the technology from the University and develop it for the market. Start-up companies wishing to license technology from the University should establish that they have capable entrepreneurial management expertise, a realistic business plan and sufficient access to capital. If a member of the University community is involved in the company – either in a management role or by having a significant equity position – an appropriate conflict of interest management plan must be developed to regulate any potential conflicts arising from the transaction.

Sign a Confidentiality Agreement (CDA) with interested companies.
All potential commercial partners will need to know confidential details of the invention before signing a licensing agreement. The KUCTC will prepare the CDA. After the agreement is in place, the KUCTC staff and the inventor may present more detailed technical material on the invention to the potential licensee. The CDA protects the patent rights of the invention because the company review is not considered a public disclosure of the invention.

Negotiate Licenses
Or otherwise commercialize the invention. The KUCTC staff will negotiate license terms. Licenses may either be exclusive (rights granted to one company) or non-exclusive (more than one company is given rights), and may be limited by geography or other field of use (e.g., domestic vs. international, veterinary vs. human: therapeutic vs. diagnostic; etc.). In arranging Licensing Agreements, KUCTC typically:

• Seeks to determine that the company has the ability to commercialize the invention and will commit the necessary resources;
• Requests research support, when needed;
• Requests up-front cash payments;
• Negotiates reimbursement of additional patent costs;
• Develops milestone payment schedules;
• Creates royalty payment schedules; and
• Develops perfromance milestones or diligence terms.