Most for-profit material providers have their own material transfer agreement templates, which they offer to PASSHE Universities as a starting point for negotiations. Finalizing terms with a for-profit material provider can be a complex and time-consuming process, particularly if the provider wants to protect the material (and associated confidential information) from further disclosure or wants to secure rights to inventions that may result from PASSHE’s researchers’ use of its material. In transactions with for-profit entities, PASSHE’s approach to Intellectual Property issues depends in large part on the source of funding that will support our planned research with the material.
If research work with a provider's material will be supported by a federal grant, contract or cooperative agreement, the University is required to follow the provisions of the Bayh-Dole Act (35 U.S.C. secs. 200-212), and its associated regulations (37 C.F.R. Part 401). Under Bayh-Dole, PASSHE Universities must either elect title to inventions that arise from research activities supported in whole or in part by federal funds, or convey title to those inventions back to the federal funding agency. PASSHE Universities may not assign title to such inventions to any party. Bayh-Dole also requires PASSHE Universities to:
· Provide the federal government with a non-exclusive, royalty free license to practice the invention.
· Share royalties with the inventor(s).
· Use the remaining proceeds to fund further research.
If a Principal Investigator's work with material from an outside source is federally funded, it is the position of PASSHE that a for-profit material provider can receive a ninety-day option to secure a non-exclusive, royalty bearing license to inventions that incorporate the original materials, progeny, and unmodified derivatives that directly result from the Principal Investigator's work with the provider's material. Any arrangement more beneficial to the material provider can be accepted by PASSHE only after the University Authorized Official (AO) is included in the negotiations. At a minimum, the university must be able to recover any costs that would be associated with meeting their obligations under a material transfer agreement (for example, the costs of obtaining a patent in order to grant rights to the material provider).
If the work will be supported by a private (i.e., non-federal) funding source, PASSHE Universities may be willing to accept intellectual property provisions that are more advantageous to the material provider, up to and including the transfer of title to inventions that include the original materials, progeny and unmodified derivatives. In such cases:
· The University Authorized Official has a role in arranging the disposition of inventions.
· PASSHE will attempt to protect the Principal Investigator’s ability to publish and to conduct future research by seeking to avoid an overly broad grant of patent rights to the material provider.
Negotiations with for-profit material providers are sometimes also complicated by confidentiality provisions, liability provisions and insurance requirements, or requests for publication delays that exceed thirty, or even ninety days. These matters are seldom an issue in transactions with educational and non-profit organizations.
To secure material from a for-profit entity:
· Obtain the provider's material transfer agreement.
· Complete a Material Transfer Agreement Inbound Material Form and forward the form and the Provider’s material transfer agreement to the University Authorized Official or designee through the researcher’s chair and dean.
· The University Authorized Official will consult with Legal Counsel and negotiate with the Provider if necessary.
· Material transfer agreements must be signed by a University official that has contract authority and by the researcher receiving the material.
Once the agreement is finalized, the researcher will receive a copy for their use. The researcher(s) may not accept or use the material until a material transfer agreement is fully signed by all parties.