Commercialize an Innovation

Entering into a Licensing Agreement with BGSU will allow the external entity to access the innovations and provide them with the right to use and commercialize innovations. The Ohio Attorney General, with comment from various Ohio technology transfer officers, developed a document explaining the Anatomy of a Patent License. All licensing negotiations are handled directly between the OTTS and a representative of the company. The process of licensing an innovation can be long one. License agreements often include requirements for payments in the form of upfront fees, minimum annual royalties, milestone payments, and sometimes transfer of equity. All licensing negotiations are handled directly between the OTTS and a representative of the company. The process of licensing an innovation can be long one. License agreements often include requirements for payments in the form of upfront fees, minimum annual royalties, milestone payments, and sometimes transfer of equity.

An Option Agreement is sometimes used to enable a third party to evaluate the innovation and its market potential for a limited time before licensing. An option agreement provides companies with a non-commercial, internal-use license for a fee. The option holder is typically responsible for payment of patent costs during the option period.

The non-financial terms of the license are equally important and will include:

• Degree of exclusivity: nonexclusive, exclusive, or restricted by field of use
• Reservation of rights for the Federal government (if the invention is derived from Federally-funded research) and for BGSU and other non-profit organizations for their research and educational activities
• Performance (or “diligence”) requirements to assure that the company has the resources to develop and commercialize the technology and is committed to doing so. These diligence terms allow for tracking the progress of the innovation toward commercialization