Negotiation and .Licensing

Negotiation and .Licensing

1. the team

   • It is unwise to negotiate on your own, as points and issues may arise that you are either unsure of or misinterpret. It is best to appoint a small team, which can be as few as two people, to address points on technology, manufacturing, legal, IP and finance, as required. MLA (Modern Language Assoc.) Mc Manus, John P. Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Oak Tree Press, 2012. APA (American Psychological Assoc.) Mc Manus, J. P. (2012). Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Cork: Oak Tree Press.

2. negotiating

   • MLA (Modern Language Assoc.) Mc Manus, John P. Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Oak Tree Press, 2012. APA (American Psychological Assoc.) Mc Manus, J. P. (2012). Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Cork: Oak Tree Press.

3. the terms

   • licence fee
     • The licence fee (also referred to as ‘lump sum’, ‘down payment’ or ‘upfront fee’) is a payment that, typically, is separate to royalty payments. For a proven technology or product, which is already in commercial operation and is being transferred as a turn-key technology package to the licensee, the licence fee is usually a set fee which all licensees pay. MLA (Modern Language Assoc.) Mc Manus, John P. Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Oak Tree Press, 2012. APA (American Psychological Assoc.) Mc Manus, J. P. (2012). Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Cork: Oak Tree Press.

4. royalties

   • setting the royalty rate
     • In setting the royalty, consideration must be given to the end-use or application of the product or technology. A stand-alone product or process based completely on the licensed technology is more straightforward than a case where the technology is only part of a whole. MLA (Modern Language Assoc.) Mc Manus, John P. Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Oak Tree Press, 2012. APA (American Psychological Assoc.) Mc Manus, J. P. (2012). Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Cork: Oak Tree Press.
   • minimum royalty
     • The licensor should have an expectation of achievable annual sales. A minimum royalty can be based on this market forecast. The minimum royalty also ensures that the licensee actively exploits the licence and does not use it as a blocking manoeuvre towards competitors. MLA (Modern Language Assoc.) Mc Manus, John P. Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Oak Tree Press, 2012. APA (American Psychological Assoc.) Mc Manus, J. P. (2012). Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Cork: Oak Tree Press.
   • resetting minimum royalties
     • In the event that the minimum royalty is not achieved, partners usually build some scope into the licence agreement for renegotiation of the minimum royalty on reasonable terms, but cancellation of the licence is an option, or reverting to a non-exclusive licence where an exclusive licence exists. MLA (Modern Language Assoc.) Mc Manus, John P. Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Oak Tree Press, 2012. APA (American Psychological Assoc.) Mc Manus, J. P. (2012). Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Cork: Oak Tree Press.

5. heads of agrement

   • Before any exchange of agreement templates begins, it is essential that a ‘Heads of Agreement’ is discussed and that agreement is reached on each of the important aspects of the planned interaction, be it a research collaboration, a licence agreement, a licence option agreement, patent exploitation agreement, or other. MLA (Modern Language Assoc.) Mc Manus, John P. Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Oak Tree Press, 2012. APA (American Psychological Assoc.) Mc Manus, J. P. (2012). Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Cork: Oak Tree Press.
   • heads of agrement licence
     • Parties: The registered legal name and location of the parties. Start date: Commencement of licence. Duration: Agree the appropriate term for the licence (see ‘Duration’ under ‘Scope’ below). Nature of licensed IP (patent, copyright, know-how, etc.): Provide only those patents that cover the specific product which the licensee wants access to (see ‘Application’ under ‘Scope’ below). Work schedule: Where work needs to be done, in transferring the technology from the licensor to the licensee, or where it is expected that one or both of the parties needs to do some specific development work to prepare the product for the market, it is essential that a well-defined work schedule is drafted and agreed by both parties before the licence agreement is drafted. MLA (Modern Language Assoc.) Mc Manus, John P. Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Oak Tree Press, 2012. APA (American Psychological Assoc.) Mc Manus, J. P. (2012). Intellectual Property : From Creation to Commercialisation: A Practical Guide for Innovators & Researchers. Cork: Oak Tree Press.

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