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1. Best Practices for Fast-Tracking Your U.S. Manufacturing Waiver Application for Federally Funded IPPresented by: Ami D. Gadhia, Director of Physical Sciences & EngineeringJohns Hopkins Technology Transfer Office for: www.techtransfer.jhu.edu

2. Welcome total access pass attendees • Technology Transfer Tactics Distance Learning Total Access Pass allows you to customize a distance learning program for your staff and faculty at a steeply discounted price with 4 convenient formats. • You can get details on our website at www.technologytransfertactics.com and click on Tech Transfer University on the left sidebar. www.techtransfer.jhu.edu

3. Presenter Ami D Gadhia, JD, LLM, CLP Portfolio Director- Physical Sciences & Engineering Johns Hopkins Technology Transfer Office Ms. Gadhia’s role is to lead and grow the JHTT Physical Science portfolio in order to demonstrate the increasing value of Johns Hopkins’ innovation to internal and external customers. She accomplishes this by cultivating excellent relationships with faculty and managing one of the largest and most technologically diverse case dockets comprising bioinformatics, medical devices, software, educational evaluation tools, and other physical science technologies. She has developed strong corporate relationships and serves as a liaison with JHU School of Engineering. Ms. Gadhia identifies commercial scenarios and strategically markets technologies. She has successfully received manufacturing waivers on behalf of JHTT. www.techtransfer.jhu.edu

4. Outline • What? • Who? • When? • Where? • How? • Why we care about this topic? www.techtransfer.jhu.edu

5. Bayh-Dole Act • Bayh-Dole Act is the legislation known for “giving birth to” university tech transfer • It’s the Act that allows universities to take title to inventions that arose from federally funded research • Universities are allowed to license their title to federally funded inventions • Licensing has to be in accordance with 35 U.S.C., which states a preference for U.S. industry www.techtransfer.jhu.edu

6. What?35 U.S.C. 204 Notwithstanding any other provision of this chapter, no small business or firm or nonprofit organization which receives title to any subject invention and no assignee of any such small business firm or nonprofit organization shall grant to any person the exclusive right to use or sell any subject invention in the United States unless such person agrees that any products embodying the subject invention or produced through the use of such invention will be manufactured substantially in the United States. However, in individual cases, the requirement for such an agreement may be waived by the Federal agency under whose funding agreement the invention was made upon a showing by the small business firm, nonprofit organization, or assignee that reasonable but unsuccessful efforts have been made to grant licenses on similar terms to potential licensees that would be likely to manufacture substantially in the United States or that under the circumstances domestic manufacture is not commercially feasible. www.techtransfer.jhu.edu

7. Feeling like this? http://upload.wikimedia.org/wikipedia/en/f/f4/The_Scream.jpg www.techtransfer.jhu.edu

8. What to Expect • Very serious matter which is not to be taken lightly–preference is for U.S. industry • Process is lengthy and could take months • Time-consuming process with no guarantee of success (fact-specific) • It took me about 40 hours to submit one application • Applications will NOT be rubber-stamped www.techtransfer.jhu.edu

9. What to Expect • Requires digging into your own records and then detailing your efforts with proof in hand to back up your assertions • Must be ready and willing to press the licensee to provide detailed information regarding their plans www.techtransfer.jhu.edu

10. Who? • “in individual cases, the requirement for such an agreement may be waived by the Federal agency under whose funding agreement the invention was made upon a showing by the small business firm, nonprofit organization, or assignee” (35 U.S.C. 204) • Non-profit organization at the request of the licensee • Non-profit = University = TTOs/Us! www.techtransfer.jhu.edu

11. When? • Exclusive Licensee (of IP that was federally funded) wants to manufacture substantially outside of the U.S. • What does exclusive mean? Does it mean all fields only, or would a field-limited license be included? Grey area…notaware of case law on this. www.techtransfer.jhu.edu

12. When? • When the licensee tells us. It’s up to the licensee to let us know that they need a waiver. • Our exclusive license template includes Bayh-Dole language that puts our licensees on notice of their obligations. www.techtransfer.jhu.edu

13. JHU Exclusive License Template Language Government Rights. This Agreement is subject to Title 35 Sections 200-204 of the United States Code as implemented in 37 CFR Part 401, as may be amended from time to time. Among other things, these provisions provide the United States Government with certain nonexclusive rights in a LICENSED PATENT if federal funds were used to develop the TECHNOLOGY. They also impose the obligation that LICENSED PRODUCTS sold or produced in the United States be “manufactured substantially in the United States”. LICENSEE will ensure all required obligations of these provisions are met. www.techtransfer.jhu.edu

14. Other Licensing Considerations • Lengthy, time-consuming process with no guarantees • Might want to consider asking for a waiver fee to cover your additional administrative expenses in applying for the waiver • Best not to make your license fee contingent upon receiving a waiver www.techtransfer.jhu.edu

15. When? • Common industries may include: electronics, medical devices, and consumer products • Global economy: waiver topic may arise in pharma and biotech sectors too www.techtransfer.jhu.edu

16. Where? • A waiver application must be submitted to the applicable funding agency or agencies, and generally can be submitted online through iEdison, the federal government's online tool for reporting under the Act. (www.iedison.gov) • For a complete list of agency contacts: https://s-edison.info.nih.gov/iEdison AgencyContactList.jsp www.techtransfer.jhu.edu

17. NSF Waiver Process Title 45: Public Welfare § 650.12   Waivers and approvals. • (a) Requests for extension of time to disclose to the NSF Patent Assistant, make an election to retain title to, or file a patent on a subject invention will be granted by the NSF Patent Assistant unless he or she determines that such an extension would either imperil the securing of valid patent protection or unacceptably restrict the publication of the results of the NSF-supported research. • (b) Approval of assignments by nonprofit organizations (required by subparagraph (k)(1) of the Patent Rights clause in §650.4(a)) will be given by the Patent Assistant unless he or she determines that the interests of the United States Government will be adversely affected by such assignment. • (c) Approval of long-term exclusive licensing of NSF-assisted inventions by nonprofit organizations (restricted by earlier versions of the NSF Patents Rights clause and by pre-Bayh-Dole Institutional Patent Agreements and waiver conditions) will be given by the Patent Assistant unless he or she determines that the interests of the United States Government will be adversely affected by such waiver. • (d) The preference for United States industry imposed by paragraph (i) of the Patent Rights clause in §650.4(a) may be waived by the NSF Patent Assistant as provided in that paragraph. [This paragraph imposes the requirements as set forth in 35 U.S.C. 204.] • (e) Special restrictions on or limitation of the right of an awardee to retain title to subject inventions imposed under §650.5 of this regulation may be waived by the Grants or Contracting Officer whenever he or she determines, after consultation with the cognizant Program Manager, that the reasons for imposing the restrictions or limitations do not require their application to a particular invention. • (f) Requests for approvals and waiver under this section should be addressed to the NSF Patent Assistant as provided in paragraph (1) of the Patent Rights clause in §650.4(a). Requests under paragraph (a) of this section for extensions of time to disclose, elect, or file may be made by telephone or electronic mail as well as in writing. A written request for extension of time to disclose, elect, or file can be assumed to have been approved unless the Patent Assistant replies negatively within ten business days of the date such request was mailed, telecopied, or otherwise dispatched. Requests for approvals or waivers under paragraphs (b), (c), (d), and (e) of this section must be in writing and should explain why an approval or waiver is justified under the stated criteria. The requester will be given a written explanation of the reasons for denial of a request covered by this section. www.techtransfer.jhu.edu

18. NIH- Waiver Process Application form can be found at: https://s-edison.info.nih.gov/iEdison/ManufacturingWaiver.jsp www.techtransfer.jhu.edu

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22. How?Requirements for Waiver • Waiver from the requirement can be obtained from the government agency that provided the funding if: • reasonable but unsuccessful efforts have been made to grant licenses on similar terms to potential licensees that would be likely to manufacture substantially in the United States or • under the circumstances domestic manufacture is not commercially feasible. www.techtransfer.jhu.edu

23. Scenario I Reasonable but Unsuccessful Efforts to License to a Company that would Substantially Manufacture in the U.S. then Waiver application must include…… www.techtransfer.jhu.edu

24. Details that TTO must provide • Significance of the technology including the availability of alternative products, size of intended patient populations; 2. Whether the requirement for U.S. manufacture will delay entry of the product into the United States or foreign markets, and if so, the effect of such delay [e.g. on public health, environment]; 3. The strategies implemented to find a U.S. manufacturer [DETAILED Marketing efforts & feedback]. www.techtransfer.jhu.edu

25. Significance of the technology • Significance of the technology, including the availability of alternative products • Does anyone in the industry manufacture in the U.S.? Where are competing products produced? Typical for this type of technology to manufactured overseas? • If a medical product, then discuss size of intended patient populations. • If an environmental technology, then discuss the size of population affected. • Provide numbers of people suffering per year, and how your technology could help. [Research the specifics and provide the data to back up your assertions.] www.techtransfer.jhu.edu

26. Will U.S. manufacture delay market entry? • Whether the requirement for U.S. manufacture will delay entry of the product into U.S. or foreign markets, and if so, the effect of such delay • Mention if possible to build manufacturing facilities in U.S. • If it will cause delayed entry into market, then note that. What will be the impact on public health/environment? Example: How many people will suffer/die each year because market entry will be delayed if U.S. manufacture is required? www.techtransfer.jhu.edu

27. Detailed Marketing • Strategies implemented to find U.S. manufacturer • ID past marketing strategy and efforts for the technology (# of companies contacted, methods used, types of licenses and terms offered to potential licensees, comparison of terms offered to potential foreign licensee and those offered to U.S. companies, and the responses of companies to those marketing efforts) www.techtransfer.jhu.edu

28. Detailed Marketing • Marketing comes in various forms: • E-mail with non-confidential summary • Marketing to company that has come to visit your campus • Marketing during “partnering meetings” at a conference • Marketing via your tech locator www.techtransfer.jhu.edu

29. Supplemental Documentation • Collect e-mails, flyers, etc. that discuss your marketing attempts • Include this as supplemental documentation for your application = No stone unturned! www.techtransfer.jhu.edu

30. “Sample Application” Answer to Question #3 www.techtransfer.jhu.edu

31. Detailed Marketing • Very important to note the company’s responses to your marketing efforts • If a company with U.S. manufacturing capabilities wanted to license your IP but you didn’t even entertain the possibility, then that may not be viewed favorably. www.techtransfer.jhu.edu

32. Scenario II U.S. Manufacture Is Not Commercially Feasible then Waiver application must include…… www.techtransfer.jhu.edu

33. Details that COMPANY must provide to TTO • Discuss factors that make domestic manufacture not commercially feasible including relative costs of U.S. and foreign manufacturing, etc.; • The part of or percentage of products in the invention to be manufactured outside of the U.S.; and • The benefits to the U.S. from the technology even if it will not be substantially manufactured in the U.S., including: (a) direct or indirect investment in U.S. plants or equipment; (b) the creation of new or higher quality U.S.-based jobs; (c) the enhancement of the domestic skills base; (d) further domestic development of the technology; (e) positive impact on U.S. trade balance considering product and service exports as well as foreign licensing royalties and receipts; (f) cross-licensing, sublicensing, reassignment provisions in license seeking to maximize benefits to U.S. www.techtransfer.jhu.edu

34. Domestic Manufacture Infeasible • Factors that make domestic manufacture not commercially feasible including relative costs of U.S. and foreign manufacturing, etc. • This is where the company may talk about the cost of building facilities here in the U.S. versus using already-built facilities in company facilities abroad. www.techtransfer.jhu.edu

35. Part/percentage manufactured outside • Company has to comment on whether entire product will be manufactured abroad or small percentage of product or just a component • Will final assembly be in U.S.? • Will technology be improved after it enters U.S.? • “substantial” manufacturing? www.techtransfer.jhu.edu

36. The Benefits to the U.S.(a) investment in U.S. plants or equipment • Example of this could include investment (specific $$$) for marketing or packaging www.techtransfer.jhu.edu

37. The Benefits to the U.S.(b) the creation of new or higher quality U.S.-based jobs • Will the product need to be sold here and therefore creates and sales and marketing jobs here? • Will enhancements be made here? Would that result in R &D jobs in the U.S.? • Answers may help to show that even though manufacturing may be done abroad, that some jobs, albeit “knowledge-based” jobs may be created in the U.S. Our economy would benefit even though some manufacturing $ are going oversees. www.techtransfer.jhu.edu

38. The Benefits to the U.S.(c) The enhancement of the domestic skills base • Are “Knowledge-based” jobs being created to mobilize sales, marketing, and R&D of the technology in the U.S.? • Would that enhance the skills of domestic employees? www.techtransfer.jhu.edu

39. The Benefits to the U.S.(d) Further domestic development of the technology • Will improvements to the technology be made in the U.S.? • Will there be an additional engineering or design done in the U.S.? www.techtransfer.jhu.edu

40. The Benefits to the U.S.(e) Positive impact on the U.S. trade balance • Positive impact on the U.S. trade balance considering product and service exports as well as foreign licensing royalties and receipts • How will royalties received impact our economy? • On a small scale, they will be distributed per our IP policy and money will go back into funding research. • Will the licensee need to pay U.S. taxes? www.techtransfer.jhu.edu

41. The Benefits to the U.S.(f) cross-licensing, sublicensing, reassignment provisions • Does the license that you are considering (or have executed) include cross-licensing, sublicensing, or reassignment provisions that would maximize benefits to U.S.? • For example, is the licensee just a pass-through that would manufacture the technology and then partner with a U.S. company that would commercialize the IP? www.techtransfer.jhu.edu

42. Pass-through licensee • Can you show that but for the licensee’s contribution, the TTO wouldn’t be in a position to partner with the ultimate company that brings the technology to the market? • Would this technology “die on the vine” because it’s so early-stage that a commercial partner is needed to add value and take it to the next stage of development? • Many times, as TTO’s know, our licensees are in the best position to partner with the ultimate company that brings our IP/technology to market. • Without the licensee, our IP/technology would fall into the “valley of death” where so many early-stage technologies die. www.techtransfer.jhu.edu

43. Time-Saving Tips: Get your Ducks in a Row! • Make sure that Statements of Government Interest have been recorded for the specific IP that you are requesting a waiver for • If you haven’t then you may have to ask your patent counsel to file Certificates of Correction for Patents or Amendments for Applications www.techtransfer.jhu.edu

44. Example: Statement of Government Interest in an Issued Patent www.techtransfer.jhu.edu

45. Time-Saving Tips: Get your Ducks in a Row! • Ensure that your case has been reported in iEdison • Update IP information in iEdison and in your waiver application (e.g. application issues as patent) • Gather all parent-child continuity data for your IP • Find the federal grant numbers, and agencies that provided funding www.techtransfer.jhu.edu

46. Time-Saving Tips: Get your Ducks in a Row! • Pose company questions to licensee early on so that they can get started on gathering information about their piece • Speak to company about limiting request to specific territory (business discussion) • Collect historical marketing information within your own office (offsite files, e-mail archives, computer folders, etc.) www.techtransfer.jhu.edu

47. What NOT to do • Not on any particular licensee’s behalf • For ALL of the technologies in your portfolio • Ask for a WORLDWIDE waiver www.techtransfer.jhu.edu

48. Worldwide waiver? • Why won’t this work? • Probably because worldwide would include embargoed countries and we wouldn’t want to allow that for public policy reasons. www.techtransfer.jhu.edu

49. Territory Example • If you want to expand the scope of the territories, then you will have to submit a new application. • You cannot simply amend a prior application that has been approved to add new territories. • Also, I am unaware of an appeals process. www.techtransfer.jhu.edu

50. What will NOT work • Providing “hand-waiving” information or anything less than FULLY complete information • Not sufficiently marketing your IP • Not exhausting possibilities of licensing to company with U.S. manufacturing capabilities www.techtransfer.jhu.edu