Key Terms for Robust Patent Licensing and Collaborations

1. TP100180024 Key Terms for Robust Patent Licensing and Collaborations Susie Middlemiss 21 January 2010

2. TP100180024 Licensing Strategy: when and why • Revenue • Technology • Freedom to operate

3. TP100180024 Due diligence • Exclusive v non-exclusive • Scope of portfolio • Cost v certainty

4. TP100180024 Key terms • Scope • Improvements and IP issues • Payment • Contracting party • Liability • Term

5. TP100180024 Scope • Subject matter • Field of use • Exclusivity • Territory

6. TP100180024 Subject matter • IP definitions • Options

7. TP100180024 Field of Use • Acts licensed v acts within claims

8. TP100180024 Exclusivity • Sole v exclusive • The crown jewels • Automatic legal rights

9. TP100180024 Territory • Link to IPRs • Extraterritorial restrictions • Know-how

10. TP100180024 IP issues • Improvements: legal effect of joint ownership • Licence or assignment? • Maintenance of IP • No challenge • Enforcement of IP • conduct • admissions • settlement

11. TP100180024 Payment • Upfront • Milestone • Royalties • Royalty stacking • Minimums • Failure to meet milestones

12. TP100180024 Contracting Party • Correct parties? • Sublicensing: • notice • consent • direct contract • Assignment • Change of control

13. TP100180024 Liability • Warranties • authority • owns right • no conflicting rights • no infringement • Indemnities • Caps and limitations

14. TP100180024 Licensee obligations • Commercial targets • product approval • sales • Not damaging IP • Records

15. TP100180024 Licensor obligations • Technology transfer • Maintenance of the IP

16. TP100180024 Term and termination • Certainty v flexibility • Life of the patents • Confidentiality of knowhow • Insolvency • Material breach • Change of control • On notice

17. TP100180024 Dispute resolution / governing law • The ideal dispute resolution clause • Arbitration • Enforcement of judgment • Same forum and governing law • Interim relief • Levels of escalation • Mediation • Expert determination

18. TP100180024 Other • Confidentiality • Force majeure • Variation of agreement

19. TP100180024 Collaborations • Additional issues

20. TP100180024 Strategy for collaborations • Resources • Synergies • IP development • Cost control • Revenue generation

21. TP100180024 Key additional clauses • Project management and control • Goals • IPR's • Payment • Exclusivity • Confidentiality

22. TP100180024 Project management and control • Project management team • Balance of power • Specific personnel

23. TP100180024 Goals • Project plan • Flexibility v certainty

24. TP100180024 IPRs • Background IPR's • Foreground IPR's

25. TP100180024 Payment • Funding R&D • Upfront payments • Milestones • Royalties

26. TP100180024 Exclusivity • Definition of the field • Competition issues • Rejected compounds

27. TP100180024 Confidentiality • Patent filings • Know-how • Publication

28. TP100180024 Term • Negotiate terms for full relationship • early stage assessment • R&D • collaboration and trials

29. TP100180024 Termination • Is fault relevant? • Who can exploit? • In what field? • What happens to existing IPR? • Know-how and clinical data? • Do sublicences continue? • Restrictive covenants/non-solicitation covenants

30. TP100180024 Competition issues • Restrictions of IPR can affect EU trade • Article 81(3) exception: • benefits outweigh anti-competitive effects • R&D block exemption • Technology transfer block exemption

31. TP100180024 3 Steps • Are the parties competitors or not? • What are their market shares? ≤ 20% competitors ≤ 30% non-competitors • Are problem clauses included? • hard core or excluded restrictions

32. TP100180024 Key Terms for Robust Patent Licensing and Collaborations Susie Middlemiss 21 January 2010

33. TP100180024 Susie Middlemiss • Direct Tel: 020 7090 4038 • Email: susie.middlemiss@slaughterandmay.com • One Bunhill Row • London EC1Y 8YY