1. William Rosenberg, Ph.D. Executive Director UMass President’s Office October 23, 2012 Baku, Azerbaijan

2.  Characterization of Early Stage Technology from Academic Institutions  General licensing concepts  The UMass’s example of a technology licensing office  Considerations on New Company Formation

3.  4284 Licenses; 1078 Options  Total income $2 Billion  Created 651 New Start-ups of which 498 in same state as academic institution  658 New products into marketplace  OTL Staff 2106 FTE * Association of University Technology Managers

4.  Discovery is result of years of Government research funding  In US, Bayh Dole Act permits assignment to institutions  Typically technology is very early stage & high risk  Can be very innovative, breakthrough, paradigm shift  Requires additional development investment by licensee (research too)  Tech Transfer & success often bound up with the motivation of the principal investigator

5.  Academic licensing offices vary greatly in experience/orientation  Typically license is for patent rights at provisional or pending stages (US-no trade secrets/know how)  Licensee does not have rights to future improvements  Participation of investigator limited by conflict rules  Little commercial strategy or validation provided by University  No warrantees

6.  Access to world class researchers  Inventions often the result of years of Federal funding  Economical, practical way to add to research pipeline  Licenses are typically reasonable and significant payments only in the event of success  To be competitive, is there really a choice?

7. 7  Professional management of the University’s intellectual property  Generate financial support and continuity through commercializing University’s inventions  Ensure compliance with Federal (Bayh Dole Act) & State laws and UMass policies  Support University’s economic development

8. 8  President’s Office ◦ Executive Director  Oversight for IP matters for 5 campuses, ◦ MTTC Director (plus 2 professionals)  Facilitates Tech Transfer for all MA research institutions  Campus Office locations & resources ◦ Amherst (4 licensing professionals) ◦ Boston and Dartmouth (2 licensing professional) ◦ Lowell (4 licensing professionals) ◦ Worcester (6 licensing professionals)  Office of General Counsel ◦ 2 Associate General Counsels supporting CVIP

9.  Manage IP  License University technologies  Development of industry partnerships  New company formation  Manage 2 Gap funds  Support to University on entrepreneurial activities

10. CVIP  Intellectual Property (IP) Policy  Policy on Conflicts of Interest Relating to IP and Commercial Ventures  Policy on Faculty Consulting and Outside Activities

11. CVIP  Reflectance Medical, Dartmouth Medical- electrical, medical devices  Anellotech, Qteros -unique processes  OWL, Texifter -Software,algorithms  MedImmune, Geckskin, Boston Scientific, Rxi - new compositions of matter  Metabolix, Scidose, Sunovian- New uses of materials and significant improvements

12. CVIP  Receipt of Invention Disclosures from faculty  Discuss with investigator  Case managers assess commercial potential and technical/scientific uniqueness, breadth  Present at Case Manager Meeting

13. CVIP  Triage  IP, Protection-Patent, Copyright  Market technologies to potential licensees  Case managers negotiate and close agreements  Prepare with General Counsel and execute licenses  Manage relationships and legal challenges

14. 14  Use of Non confidential invention summaries  Inventors are often the best source of leads  Public disclosure  Networking - meetings and conferences  Market research  Websites (ours and 3 rd party services)  Cold calls

15.  Confidential Disclosure Agreements  Material Transfer Agreement  Inter-institutional patent management agreement (IIA)  Term Sheet  Option Agreement  Exclusive or Non exclusive license agreement

17.  Exclusive or non-exclusive  Defined Field  License Fees (range from $5K to $XM)  Equity 5-10% (if new company formation)  Royalty (range from 1% to 6%)  Sublicense income (10-30%)  Patent expense reimbursement (if exclusive)  Milestones/Due Diligence (if exclusive)  Indemnification/No warrantees  Board visitation (if new company formation)

18. Over 400 licenses to companies (pharma, biotechs, med device, clean tech, IT, materials) UMass among the top US academic institutions

19.  Best way to commercialize certain technologies- too early to license  Commercialization planning and efforts beyond university resources  Big companies won’t bite  New company affords opportunity to capture “real” value  Economic development reasons (jobs, taxes etc.)-startups usually remain local  Alignment of interests (institution, PIs. entrepreneur, funders)

20.  “ The research also showed that successful entrepreneurial output requires more than a proficient technology transfer office with effective policies and a strong incentive system,” said Robert Strom, director of Research and Policy at the Kauffman Foundation. “It also relies on an overall university ecosystem that helps to reduce the venture’s market and technological risk by providing programs and resources that give students and faculty freedom – and time – to develop strategic lab-to-market plans.”  Independent of their technology transfer offices, many of the eight universities studied have implemented mentoring programs, business plan competitions, accelerator programs, entrepreneurship training for students and faculty, and project-based classes that bring together interdisciplinary or MBA student teams to work on business plans and create roadmaps for commercialization. According to the study, these programs and practices have enhanced entrepreneurial efforts and allowed the universities to serve as business incubators.

21. Strong Science Licensing Office IP Education Entrepreneur Mentoring Investors Service Providers

22.  Investment Funds  Programs including entrepreneurship training, company mentoring, showcase events, grant programs, investor network  Active VC alumni support  UMass incubators with support  Extensive network in MA business community

23. Lab Market Programs (MTTC & CVIP) Funding UMass Startup Initiative$5K Proof of ConceptVenture FormationA - Round Tech. Development Fund $25 – 30K Co- Investment Fund $500K Invention to Venture Boot Camp Platform Program Technology Showcase New Venture Mentoring Seed Fund $75 - $250K

24.  CVIP Technology Development Fund -$30K per award to investigator for proof of principle -9years, good results  UMass Startup Initiative $5K for preparation of business plans; new  CVIP Co-Investment Equity Fund $500K per company:  New Seed Fund Planning stage -$250K per company at earliest stages

25. Mentoring and Support  Professional licensing staff (about 15 people)  Dedicated University attorneys (2) experienced with startup and equity issues  MTTC programs (Platform, Conferences, Networking events, Bootcamps)  Venture Creation specialist focused on the startup pipeline at all stages  UMass incubators  Support of senior University management

26.  Identification of promising technology  Use of university POP or other gap funds to advance development  Preliminary technology and market assessment  Assessment of faculty/grad student interest  Determination of startup models available (use of internal /external resources )  Identification of entrepreneurial team and due diligence on them

27. Possible Institution Activities  Option technology for technology & business assessment and planning  Validation of newco’s commercialization strategy  Assist with networking, resource sourcing, mentoring and coaching  Use license to memorialize strategy and commitments  Invest??  Continuing roles such as board advisor

28.  Management team formation, development and funding responsibility  University provides no warrantees  University typically controls patent prosecution  Exclusive licenses require due diligence milestones by licensee -termination if not met  University faculty can serve on SAB or conduct further research (usually) but not officer of company

29.  Qteros-microbial production of chemicals-$30M  Dartmouth Med Research-polymers for bone replacement-$1M  Anellotech-catalytic conversion of biomass-$20M  Anterios-nanotech based delivery system-$10M  Konarka- cleantech-$160M  Reflectance Medical- non-invasive monitoring system-$10M SBIR  Texifter-sorting of large amounts of unstructured texts-grants, organic growth  Sevo Neutraceuticals-memory enhancement - $250K  Therapeutic Systems-pressure vest for autistic children, $500K plus grants

30.  William Rosenberg, Ph.D.  Executive Director  Commercial Venture and Intellectual Property  UMass President’s Office  Tel 617 287 7044  Email- wrosenberg@umassp.eduwrosenberg@umassp.edu