2. A Dual Role Principal (Rector) of Heriot-Watt University Chair of the regional economic development company

3. IP ownership in the UK Employers - even Universities - own the IP created during employment. Students own their own IP but can assign to the University and be treated as members of staff Universities assign copyright in publications but not teaching materials Universities share royalty income with staff Universities license IP to companies but do not normally assign it

4. Powering the Knowledge Economy Universities play a key role at the heart of the knowledge economy……………. They: Educate people with high level skills generate new knowledge apply new knowledge to enhance economic prosperity AND quality of life

5. Recognising the need Universities play a key role at the heart of the knowledge economy……………. Their ability to support the application of new knowledge depends increasingly on effective management of Intellectual property Too often this process is less than smooth Expertise, strategies and policies are needed

6. SE Edinburgh & Lothian As Chairman of a regional economic development agency: IP being created - especially in biotech Often unsatisfactory interactions Lack of expertise on both sides Companies frustrated IP not being released Universities not earning income form IP Universities being challenged

7. Scotland’s IP Performance 8.6% of UK population  12%of total UK research funding  3rd in the world for research publications per capita  24% of invention disclosures in the UK HEIs  16% of new UK patents  20% of licenses from UK HEIs  19% of spin-out companies from UK HEIs

8. Scotland’s IP Performance (2) Which in 2002 meant: 100 new technology licensing agreements 100 new companies since 1999

9. In comparison with the USA for each millon dollars research spend Scotland produces:  1.5 X number of licenses  5 X number of spinouts  3 X disclosures  but only 0.69 X number of patents Scotland’s Efficiency

10. WHY is IP Management Important? To avoid conflicts AND conflicts of interest To understand levels of investment and price knowledge transfer appropriately To ensure that IP incentives are distributed fairly and consistently with other policies To ensure that exploitation does not overshadow knowledge creation To manage conflicts that will arise

11.  500 research staff  £16 million in research income  @ 20-25 disclosures each year  @ 12 patents filed per year- only those with route to market or platform technologies  year one - no licenses ; year 3 - 4-5 licenses  3-4 spin-out companies each year Heriot-Watt

12.  IP revenue is shared - after costs  Staff/School/Patent Fund  Spin-outs  24% equity  exclusive licenses  royalty free at first  assigned when company is robust Heriot-Watt Policies

13.  Have a sensible and effective Policy in place  Manage it  Teaching, research, external activities & 3rd leg  Register of interests  Self-policing but with teeth Conflict of interest

14. Collaborative Research Issues: IP generated needs to be identified, evaluated and protected Future access to IP by the university needs to be considered Research, if used for commercial purposes can infringe others’ IP and lead to litigation Publication may infringe others’ IP and expose the University to litigation - especially electronic publication expertise in commercialisation in the UK is - largely - in the universities

15. Heriot-Watt & industry  In collaborative research with industry Heriot-Watt  Retains ownership of IP  Offers standard contract terms - generally accepted  Industry  meets full costs of research  gets 1st option on the IP  gets an exclusive licence  meets costs of defending licences

16.  IP revenue sharing between Staff/School/Patent Fund  Staff can hold equity in companies, if University permits  Consultancy and CPD = returns to staff after costs (currently 70% to individual/ 30% to School)  Discussions about 3rd leg and career progression Incentives for Staff

18. The Guide Managing Intellectual Property A Guide to Strategic Decision-making in Universities UUK: AURIL:DTI: Patent Office URL: http://www.patent.gov.uk/about/notices/manip/index.ht m

19. Tensions Commercialisation V Research Excellence expectation but no esteem for commercialisation knowledge transfer is not fully recognised commercialisation activity takes staff attention from basic research commercialisation takes research active staff out of basic research commercialisation requires professional expertise

20. Unresolved tensions What are now “normal” duties and expectations? How do we handle the impact on research activity of the secondment of staff to spin-outs? Do we include commercial activity in promotion criteria? Do we reward research earners in the same way that we reward inventors with royalties? Do we continue to reward staff for “3rd leg” activity - CPD and consultancy?

21. Issues for Institutions Commercial activity provides valuable interactions with industry but they need to be managed Consultancy: may infringe IP owned by other companies may represent a potential leakage of IP Research Funding: requires a clear contractual arrangement at institutional level Personnel issues can arise : disputes between staff over IP ownership or invention need to be managed

22. Issues to Consider Do we own the IP we need to own? To enable us to carry out research To use research results in future research To deliver our teaching, including ODL? Can we use IP exploitation to recruit and retain staff? Can we prevent conflicts of interests between staff? What about student IP - do we infringe it ? Do we know?

23. Ownership - an issue? The real issue is knowing what you have and what you want to do with it Much of it will have a “sell-by” date All of it has no value if it is not used IP needs to be used effectively

24. Institutional Missions Knowledge Acquisition / Knowledge Transfer If your mission is strongly regional in focus do you trade getting the best world price for diffusion locally? If your mission is to be excellent in research do you prefer a direct financial return for research and allow free knowledge transfer? Does research influence the quality of teaching?

25. 3rd leg Benefits?

26. Measuring Success Measure the success of your activities by your goals

27. Operational Information Gillian McFadzean Director, Technology & Research Services Heriot-Watt University, Edinburgh EH14 4AS email: G.McFadzean@hw.a.cuk Tel +44 131 541 3881