CPI Technology Transfer & Commercialization 3 — Questions and Answers
Question 1: A company licenses technology but the market shifts before launch. Which license clause best protects the licensor's interest in this scenario?
- Confidentiality clause
- Diligence clause with performance milestones (Correct answer)
- Indemnification clause
- Governing law clause
Correct answer: Diligence clause with performance milestones
Diligence clauses require licensees to meet development milestones, ensuring the licensor can reclaim or re-license IP if the licensee fails to actively commercialize it.
Question 2: What distinguishes a 'know-how' license from a patent license in technology transfer?
- Know-how licenses grant exclusive rights; patent licenses are always non-exclusive
- Know-how licenses transfer proprietary technical knowledge not covered by patents, which may be harder to protect but often critical for implementation (Correct answer)
- Know-how licenses are only used for software, while patent licenses cover hardware
- Know-how licenses require government approval; patent licenses do not
Correct answer: Know-how licenses transfer proprietary technical knowledge not covered by patents, which may be harder to protect but often critical for implementation
Know-how encompasses trade secrets, methods, and expertise that complement patented technology and are often essential for a licensee to actually implement the invention.
Question 3: Which of the following is a key challenge specific to commercializing platform technologies?
- Platform technologies have no patent protection
- Identifying which specific applications to prioritize given that the technology enables many potential markets (Correct answer)
- Platform technologies cannot be licensed exclusively
- They always require FDA approval before commercialization
Correct answer: Identifying which specific applications to prioritize given that the technology enables many potential markets
Platform technologies' greatest commercialization challenge is market selection — the breadth of potential applications makes prioritization and resource allocation critical.
Question 4: A technology spinout receives a Series A investment. How does this typically affect its relationship with the university licensor?
- The license automatically converts to a non-exclusive license
- Milestone payments and royalty obligations continue; equity dilutes but the university's stake may be renegotiated (Correct answer)
- The university loses all rights to the technology upon outside investment
- The spinout must renegotiate the license from scratch
Correct answer: Milestone payments and royalty obligations continue; equity dilutes but the university's stake may be renegotiated
Series A funding doesn't void license terms; royalties and milestones remain active, though equity arrangements may be adjusted through negotiation as the company matures.
Question 5: What is the main advantage of a non-exclusive license over an exclusive license for a university technology transfer office?
- Non-exclusive licenses generate higher per-licensee royalties
- Non-exclusive licenses allow the technology to be commercialized across multiple companies simultaneously, broadening societal impact (Correct answer)
- Non-exclusive licenses are easier to enforce legally
- Non-exclusive licenses do not require patent prosecution
Correct answer: Non-exclusive licenses allow the technology to be commercialized across multiple companies simultaneously, broadening societal impact
Non-exclusive licensing enables multiple companies to develop products based on the technology, increasing its overall societal and economic impact.
Question 6: In the context of tech transfer, what is a 'march-in right'?
- The right of a licensee to sublicense in new geographic markets
- The right of the federal government to require licensing of a federally funded invention to others if the original licensee fails to commercialize it adequately (Correct answer)
- The right of the inventor to receive a share of royalty income
- The right of the TTO to terminate a license for non-payment
Correct answer: The right of the federal government to require licensing of a federally funded invention to others if the original licensee fails to commercialize it adequately
March-in rights under the Bayh-Dole Act give the U.S. government authority to license federally funded IP to third parties when the current licensee isn't meeting commercialization obligations.
Question 7: Which stage of the Stage-Gate process is most directly tied to technology transfer decision-making?
- Stage 5 (Launch)
- Stage 1 (Scoping) and Gate 2 (Second Screen), where technical and commercial feasibility are assessed (Correct answer)
- Stage 3 (Development)
- Stage 4 (Testing and Validation)
Correct answer: Stage 1 (Scoping) and Gate 2 (Second Screen), where technical and commercial feasibility are assessed
Early Stage-Gate phases evaluate whether external technology should be licensed in or whether internal IP should be transferred out, making them critical transfer decision points.
CPI Technology Transfer & Commercialization 3
A company licenses technology but the market shifts before launch.
Which license clause best protects the licensor's interest in this scenario?