Agriculture Reference
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the. option. to. ile. a. patent. application. is. important. not. only. because. of. control.
over. the. publication. delay. period. but. also. because. the. content. of. the. application.
deines.who.is.responsible.for.generating.the.innovation.as.well.as.the.nature.of.the.
innovation..Both.of.these.parameters.can.be.deined.broadly.or.more.conservatively;.
this.will.have.signiicant.implications.for.who.controls.the.licensing.rights.and.how.
strong.these.rights.turn.out.to.be..In.some.instances,.the.university.partner.is.respon-
sible. for. iling. the. patent. applications,. but. the. degree. to. which.the. private. partner.
provides.guidance.and.is.involved.in.patent.litigation.is.varied.
A. more. subtle. issue. is. whether. a. university. is. obligated. to. ile. for. a. patent. if.
requested. to. do. so. by. the. industry. partner,. or. whether. it. has. some. discretion..
A university.partner.may.wish.to.avoid.expending.the.effort.required.to.patent.inno-
vations.if.it.does.not.foresee.that.it.will.be.applied.commercially..For.example,.under.
the.Berkeley/NADI.agreement,.Berkeley.can.elect.not.to.ile.for.a.patent.that.NADI.
does.not.intend.to.commercialize..In.other.words,.Berkeley.can.make.sure.that.inno-
vation,. or. know-how,. that. would. not. otherwise. be. commercialized. remain. freely.
available.to.the.public.and.that.limited.administrative.resources.are.not.diverted.to.
pursue.meaningless.patents.
Of.vital.importance.for.industry-university.research.agreements.is.the.nature.of.
the.licensing.options..Currently,.it.is.common.for.the.industry.partner.to.be.given.a.
irst-to-negotiate.licensing.option.for.some.subset.of.the.innovations.generated.under.
the.research.agreement..Generally,.these.options.must.be.exercised.within.a.speciied.
time.period,.or.else.the.option.is.extended.to.third.parties..In.response.to.public.out-
cry.concerning.previous,.poorly.structured.agreements,.such.as.the.Sandoz/Scripps.
agreement,*. and. concern. about. blocking. patents,. right-of-irst-refusal. options.
evolved.into.right-to-negotiate.options..In.theory,.if.the.industry.partner.is.granted.
the. more. limited. option.of. right-to-negotiate,. a. university.has.greater.control. over.
licensing.rights.and.can.prevent.blocking.patents.from.being.awarded..Other.aspects.
of.licensing.agreements.receive.less.attention.but.are.also.critical..One.such.aspect.is.
the.percentage.of.the.total.innovation.for.which.the.industry.partner.holds.an.option.
to.negotiate.an.exclusive.license.or.access.option..For.example,.under.the.Berkeley/
NADI.agreement,.NADI.can.exercise.this.option.for.an.“allowable.percentage”.of.
patents,.equal.to.the.percentage.of.the.research.funding.that.came.from.NADI;.there-
fore,.NADI.has.limited.access.options..Under.other.agreements,.the.industry.partner.
holds.this.option.for.all.patented.discoveries.generated.by.the.agreement.
Third-party.options.are.also.a.critical.aspect.of.licenses.options..These.options.are.
the.rights.that.parties.outside.the.agreement.have.to.innovation.generated.by.the.agree-
ment..Under.the.Berkeley/NADI.agreement,.third.parties.hold.open.options.on.patents.
not.included.in.the.allowable.percentage,.and.on.patented.innovations.either.covered.
by.nonexclusive.license.or.for.which.the.irst-to-negotiate.option.has.expired.for.NADI..
NADI.has.no.recourse.once.their.licensing.option.has.expired,.and.Berkeley.is.free.to.
* . In. 1993,. the. publicly. funded. Scripps. Research. Institute. agreed. to. form. a. research. partnership. with.
Sandoz.Pharmaceuticals..Sandoz.agreed.to.provide.$300.million.in.funding.for.research.over.10.years.
in.return.for.a.worldwide.license.for.all.of.discoveries.made.by.researchers.at.Scripps..This.controver-
sial.agreement,.which.would.have.given.Sandoz.licensing.rights.to.nearly.$1.billion.of.research.funded.
by.the.federal.government,.was.restructured.after.the.government.threatened.to.cut.off.funding.for.the.
institute.
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