Technology transfer

In order to encourage the exploitation of patents, Spanish patent law allows patent and utility model holders to offer them through Full Rights Licenses to benefit from the conditions for the payment of maintenance fees.

Specifically, Article 81.1 of Law 11/1986 on Patents establishes that “if the patent holder offers full rights licenses, declaring in writing to the Spanish Patent and Trademark Office that he is willing to authorize the use of the invention to any interested party, as a licensee, the amount of the annual fees accrued by the patent shall be reduced by half after receipt of the declaration.”

Thus, those patents for which the Spanish Patent and Trademark Office (OEPM) has accepted an Offer of Full Rights License enjoy a 50% discount on the maintenance fee.

In addition, these patents will be advertised by the OEPM, specifically through publication on the website of patents and utility models with offers of full rights licenses.

While assignment agreements usually involve a one-time payment, licenses often include performance conditions or terms that must be met in order for the licensee to make financial payments to the licensor. These payments are commonly known as royalties.

There are two essential aspects to consider in these payments: the royalty base and the percentage. The most common method of payment for technology licenses is a percentage of royalties on net sales; that is, it is income received by the licensor linked to the licensee’s sales success. However, royalties can be determined based on various variables: units sold, weight, EBIT, EBITDA, manufacturing cost, purchase price, etc.

In addition, in the vast majority of industrial sectors, the payment of a royalty percentage is usually combined with one or more fixed amounts of money. This is especially common in long-term contracts, as the level of technology development is generally still low and the time frame for obtaining sales is long.

These types of measures allow the research team to obtain funds to continue their activity without having to wait several years for the resulting product to be commercialized.

In most cases, licensees require the active assistance of the inventor to facilitate their commercialization efforts, at least in the early stages of development. This can range from frequent, informal contacts to a more formal consulting relationship.

It should be noted that, in most cases, licensing agreements fail not because of a failure of the technology but because of preventable causes, such as an inadequate agreement structure, errors in the management of the commercialization process, or cultural and objective differences between the licensor and the licensee. It is therefore important at all times to facilitate the highest level of communication between both parties.

After signing the contract, most licensees must continue to develop the invention to improve the technology, reduce risks, test its reliability, and adapt it to meet market needs, thus facilitating its adoption by customers. This may include additional testing, prototyping for manufacturing, durability and integrity testing, development to improve performance and other features, etc.

In particular, benchmarking tests are often particularly useful both to demonstrate the advantages of the product/service and to establish its market positioning strategy. In addition, all the documentation necessary for training, installation, and marketing of the product/service is often created during this phase.

Yes, an invention can be licensed to multiple licensees, either on a non-exclusive basis to several companies or on an exclusive basis to several companies, each for a single field of use (application) and/or geographical area.

It can take months, and sometimes years, to locate a potential licensee, depending on the attractiveness of the invention, its stage of development, competing technologies, and the size and intensity of the market. The earlier the stage in the development cycle an invention is in, the greater the investment required to commercialize it, so it is often more difficult to attract a licensee.

Studies show that in 70% of cases, licensors or entities collaborating with them already knew the licensees beforehand. Thus, research and consulting relationships are often a very valuable source for licensees, as are contacts obtained from market research, events, conferences, and trade shows in the relevant sector, or even social media.

A licensee should always be chosen based on their ability to commercialize the technology. Sometimes the best option is an established company with experience in similar technologies and access to the most important markets. However, in other cases, the focus and intensity of a new company creation or start-up is a better option. In general, creating a start-up is more appropriate in the following cases:

• Technologies that are not yet mature or are in their early stages, requiring significant development work.
• A management team with a strong entrepreneurial spirit and high level of commitment.
• More radical and general innovations that can serve as a basis or platform for multiple developments or applications.
• Access to short-term external or internal financial support.

Research: Observations and experiments during research activities often lead to discoveries and inventions. An invention can be any process, machine, composition of materials, or any new and useful improvement of the above. Often, several researchers may have contributed to the invention.

Evaluation: Patent searches and analysis of market technologies and competition must be conducted to determine the commercialization potential of the invention. This evaluation process may lead to further development or refinement of the invention and will guide our transfer strategy.

Protection: The process of seeking protection for an invention can be done through patents, but it can also involve other methods including copyright and intellectual property rights, designs, trademarks, trade secrets, and contractual restrictions on use (e.g., databases and materials).

Marketing: Candidate companies with the necessary expertise, resources, and relationships to bring the technology to market are identified. This may involve partnering with an existing company or forming a new company or start-up.

• Start-up: If creating a new company is the optimal commercialization path, then planning and financing for the start-up must be addressed.
• Existing companies: If the best route to commercialization is through existing companies, then potential licensees are selected, contacted, and due diligence and negotiation of appropriate operational and financial terms to commercialize the technology are conducted.

License or assignment: A license or assignment agreement is used with both a start-up and an established company.

Commercialization: The licensee makes the necessary investments to develop a fully marketable product or service. This step may involve further development, regulatory approvals, sales network and marketing support, staff training, and other activities.

The process of protecting the technology and finding the right partner for licensing or assignment can take months or even years to complete. The amount of time will depend on the stage of development of the technology and the amount of work required to generate a marketable product from the new concepts, market conditions, competing technologies, and the resources and willingness of the owners and inventors.

• Non-disclosure agreements (NDAs): These are often used to protect the confidentiality of an invention during the evaluation of potential licensees. These agreements are also used to protect confidential information from third parties ( ) that researchers must use in order to conduct research or evaluate new research or collaboration opportunities.
• Material transfer agreements: describe the terms under which internal and external researchers may share materials, usually for research or evaluation purposes. Intellectual property rights may be at risk if materials are used without adequate contractual regulation.
• Collaboration agreements: describe the conditions under which two or more entities will work together, not only to carry out an R&D&I project, but also to protect, evaluate, commercialize, license, and share the income from the research results.
• Research agreements: describe the terms under which sponsors provide support for research.
  Option agreements (or option clauses within research agreements): describe the conditions under which the generating entity reserves the right for a third party to negotiate a license.

These option clauses are typically included in a research agreement for corporate sponsors or in contracts with third parties who wish to evaluate the technology before entering into a licensing agreement.

Technology is usually transferred through a transfer or license agreement in which the generating organization grants its rights to use the technology to a third party.

The main difference between assignment and licensing is that, while the former involves a transfer of ownership of the technology and all corresponding rights, the latter only allows the licensee to use the technology, generally for a specific period of time, while the licensor retains the rights and ownership of the technology.

Furthermore, in the case of licensing, it is often limited to a particular field of use and/or a specific region of the world. It should be noted that, in the field of technology transfer, licensing transactions are much more common than assignment transactions, as the initial outlay required is usually much lower, thus posing less risk for the entity that will carry out the commercial exploitation

There is currently a growing recognition that technology transfer efforts offer significant benefits for public research centers and universities, as well as for industry and society in general.

• For institutions, technology transfer offers the research community the opportunity to have a direct socio-economic impact and obtain new sources of funding.
• For the industrial community, technology transfer allows companies to gain new market access for developments that they cannot commercialize directly, as well as to take advantage of discoveries made by third parties to increase their commercial offering.
• For the general public, technology transfer offers the opportunity to benefit from new technological advances more quickly and efficiently.

Broadly speaking, technology transfer is any operation that involves the transfer of innovative knowledge to be shared, licensed, acquired, or transferred. There are many frameworks in which transfer can take place, including: collaboration on R&D&I projects, specific training courses, staff exchanges, conferences, and industry relations, among other things. However, for the purposes of this guide, technology transfer refers to the formal licensing or transfer of technology generated by universities, research centers, and companies to third parties for industrial and commercial development.