Explaining Tech Transfer

Friday, October 18, 2019

Sewell details what the process means for OSU research

We sat down recently with OSU Vice President for Research Kenneth W. Sewell to discuss the process of technology transfer and what it means for research.

What is technology transfer? 

Technology transfer is the act of moving the rights or “know-how” of a new technology from one organization to another. Tech transfer gets an invention/ innovation out of the laboratory and into the marketplace. At OSU, the whole point of tech transfer is to multiply the impact of our researchers’ innovations so as many people as possible can use the technology. 

What does tech transfer look like at OSU?

The tech transfer process starts when a faculty member lets us know about a new invention or a new use for an existing technology by submitting a written disclosure form. This identifies the discovery, those responsible for the creation and other information about how the invention could be used commercially.

The Technology Development Center at OSU, part of the Division of the Vice President for Research, manages the entire process from disclosure onward. Each disclosure is reviewed for novelty; protectability (Can it be patented? Are there potential trade secrets that can be guarded?); marketability; time to market; funding for further development; market growth and size; existing similar intellectual property; and current competition. After all this, we decide whether to a) file for a patent, b) protect by trade secret or c) do nothing.

As the patent process proceeds, the faculty member will continue developing a promising technology, and an OSU licensing associate will begin to market the technology. An option gives a company the first rights to a technology and provides the “option” to negotiate a full license in the future. A license allows a company to use or sell an OSU-owned technology. 

We commonly hear the terms tech transfer, commercialization and corporate partnerships in the same arena. What are the differences?

Tech transfer includes all the steps from initial lab findings/invention to further development through applied research until a license is completed.

We often use commercialization within tech transfer to mean starting up a brandnew company to get an OSU-owned invention to the marketplace. But it can also refer to that final step of getting the invention out into public use, through a licensing agreement to an existing company.

Corporate partnerships can be key to technology transfer. Partners may be willing to fund research to accelerate the development of an invention or to prove its efficiency. These same partners might then license the new technology themselves or become a customer/user once the product is available.

What other services does OSU offer in this area?

The Technology Development Center manages all intellectual property. Also, Cowboy Technologies is an investment arm for early-stage start-up companies spinning out of OSU and assists OSU entrepreneurs in applying for small business grants from federal agencies. Through the entrepreneurship program in OSU’s Spears School of Business, we also have an NSF I-Corp site that trains faculty and students on gaining real market feedback on their technologies. OSU also works closely with the Oklahoma Center for the Advancement of Science and Technology (OCAST) for further development. 

What is a royalty, and how does it benefit the university?

Royalty is the term for the payment amount negotiated between the licensor (OSU) and the licensee. This is usually a percentage of sales or uses of a product. Other common options are upfront payments (often with a smaller ongoing royalty) or an equity stake in the licensee’s company.

Royalties serve multiple purposes for OSU: They offset the expenses we incur in protecting and marketing new technologies; they allow us to continue investing in new ideas; and they are used to reward and incentivize faculty innovators.

Historically, what technologies have earned the most royalties for OSU, and what impact have they had on OSU and the state of Oklahoma?

Inventions ranging from livestock probiotics and radiation detection badges to wheat and grass varieties have created financial benefits for the inventors and provided resources for the OSU departments and the Technology Development Center. On average, OSU technologies earn over $2.5 million in royalties each year.

And even though these innovations have brought substantial royalties back to OSU, the main goal is not to “make money” per se, but to create and accelerate the positive impact from OSU innovations. The royalties are a byproduct used to sustain the process.