Genewired

The Singapore government has often proclaimed the biomedical industry to be the fourth pillar of our new economy. Since the mid 2000s efforts have been made to bring the billion dollar biologics manufacturing industry, a key component of the biomedical sciences to our shores.

In short, biologics refers to agents that are derived from living sources. Examples include serum, vaccines and monoclonal antibodies, as well as hormones and insulin. Proteins and other compounds form the building blocks of life, and as research has shown, can also save lives by curing diseases. While chemically synthesized drugs such as Lipitor (world’s top selling drug in 2006), a statin drug used in the lowering of cholesterol levels, used to be the perceived cure to most known diseases, biologics drugs are slowly but surely being noticed as new forms of treatment.

I recently closed a deal with a company. Nothing huge and exciting, but a "deal" nonetheless. What should have been a happy occasion was marred a little when I found out the other party was making back-channel complaints about the length of time it took to close the deal.

Of course, complaints about the "slowness" of university technology commercialization offices (TCOs) are nothing new. I've blogged about the issue before in this space, but it is such a recurring theme that it probably deserves some more attention.

I was a little surprised to get complaints in the particular case because it was a deal that was fated to take forever because (a) the technology being licensed was not the most exciting technology that the university owns, (b) the company was licensing it primarily for strategic purposes and wasn't planning to make it the focus of their research and (c) not much money was changing hands. Deals like are just going to take forever and result in duels to the death over legal minute because neither party is hugely incentivized to close.

Our technology commercialization office (TCO) often gets offers to from business school professors, attorneys, etc. to offer educational sessions on topics such as "How to inject entrepreneurship into your science!" or "How to start a business!". As interesting as these topics may be, they are usually putting the cart before the horse because the #1 thing that I wish our inventors understood better was the patent standard for "obviousness".

If you stop the common man on the street and ask, "What do you need to get a patent?" the most common answer is "a new idea." It is true that "novelty" is one of the requirements for patentability. Another requirement (utility) is so rarely a problem that it isn't worth discussion except in the most unique of circumstances. However, I don't think that most people (including those that are university faculty) understand that "non-obviousness" is just as important of a requirement for patentability as novelty is.

Contracts are set in stone, correct? Right?

The answer depends on whether you are the licensor of a technology or a licensee. Let me explain.....

Licensors do have many ways to terminate a technology agreement: bankruptcy, failure to hit milestones, failure to provide reports, etc. However, the licensor cannot terminate a license agreement without cause. And....when they are terminating for cause, there is always a "cure period" during which the licensee can fix matters. This cure period greatly weakens the ability to terminate a license. Virtually every licensee in the history of technology licensing has been or is out of compliance with their reporting duties: they are not giving written semi-annual reports on the development of the technology like they said they would, their reports on sales of products do not conform to the agreed upon format, etc. However, if the licensor attempts to terminate the license on this basis, the licensee could buckle down and catch up on its reporting during the 30-45 day cure period and keep the license intact. Thus, the only effect of the termination threat is to annoy the licensee.