Technology, Patents & Licensing

Technologies and licensing is fueling growth across the United States.

The world of technology, patents and licensing has shown a tremendous growth in the last 15 or so years. Inventions created in university labs and company research and development offices are being patented and promoted, creating new possibilities all across the United States. This field is technical and highly specialized, but learning the ropes can put you in the position of being on the cusp of new business opportunities.

Definition of "Technology" in This Context

Technologies vary from laboratory work to mechanical inventions.

In the realm of patents and licensing, the term “technology” is synonymous with invention. The technology may be a result of a company’s research team, such as when a new appliance is created. It may be the result of a university research team, such as when a drug is discovered that treats Alzheimer’s, or it may be the result of team created with members from both backgrounds. Technologies can also be created by individuals working on their own.

Patent Protection and Patentability

Though commonly thought of as guaranteeing the inventor’s rights to the technology, patents actually preclude others from making, using or selling the invention. Patents are issued by the governments of countries. The United States Patent Office grants patents in the United States. To be eligible for a patent an invention must be unique, not obvious to one skilled in the art relating to the invention, and the inventor must not have shown the invention to others or talked about it in detail to others. This is known as “public disclosure.”

Patent Process

To request a patent the inventor (or her representative) must fill out several forms. A detailed description of the patent, called specifications, is required. Drawings may also be submitted. Other requirements are the paying of a fee, which depends upon the number of pages in the application. The process of being approved or denied a U.S. patent can take five to eight years. During this time the patent examiner sends questions about the application (called “office actions”) to the inventor. The inventor is required to respond by the deadline. If a patent is granted, the invention is protected for 20 years from the original filing date.

Licensing

After a technology is patented, the inventor(s) usually want to find a company that wants to make and sell the product. In the case of a university, a Commercialization or Technology Transfer department will market the invention to companies. The company licensing the invention pays a that may be a one-time, quarterly, or annual payment. The company often also pays a percentage of the money it makes by selling the product (a “royalty fee.”) Sometimes equity in the company--particularly when the company is new--is sometimes given to the licensor. These contracts, called “licenses,” usually last as long as the patent is valid.

Growth in Commercialization of Technologies

The field of technology commercialization is on an upward swing.

Universities and companies use the commercialization of technologies to fund continued research. In the case of universities, the invention is usually owned by the institution, but the inventor may be given a percentage of the royalties. The rest of the royalty is then redirected into the university’s funding for research.

Impact of Technologies, Patents, Licensing on Communities

Universities and communities are increasingly combining their efforts to commercialize a university’s research, and to create jobs to help a local economy. Many times individuals create a start-up company based solely on the new invention. By giving the start-ups or existing companies tax incentives, the local government promotes the geographical region and encourages the use of the university’s inventions. The combination of technologies, patents and licensing creates an environment where ideas generate revenue, jobs and community growth.

References

• Association of University Technology Manager
• United States Patent Office

Resources

• "The Idea Incubator Goes to Campus" The New York Times
• Newsweek Magazine: Engineering Careers