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About
MIHR
PIPRA
Fiocruz, Brazil
bioDevelopments- Institute
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RAZGAITIS, Richard
Dr. Richard Razgaitis has 40 years of experience working with development, commercialization, and technology management. He began his professional career as a “rocket scientist” on the Saturn/Apollo lunar launch team, and worked on every launch from Apollo 1 through the first lunar landing. He was a faculty member for 10 years and taught more than 20 different undergraduate and graduate level courses. He was also a research scientist and inventor at a billion-dollar private institute. For 10 years, he was vice president of commercial development/licensing at two different billion-dollar companies. Since 1998, he has been a consultant in IP/technology management, opportunity discovery, valuation, and dealmaking.
He is the author of three books on valuation and dealmaking: Early-Stage Technologies: Valuation and Pricing; Valuation and Pricing of Technology-Based Intellectual Property; Dealmaking Using Real Options and Monte Carlo Analysis (all published by John Wiley). He has also authored two book chapters: “Technology Valuation,” published in The LESI Guide to Licensing Best Practices (Wiley, 2002), and “Pricing the Intellectual Property Rights to Early-Stage Technologies: A Primer of Basic Tools,” AUTM Technology Transfer Practice Manual (2003). For more than 10 years, he taught technology valuation and pricing courses for AUTM to more than 2,000 students.
For more than 10 years he held a variety of senior positions in the Licensing Executives Society, including VP and Treasurer. Since 2000, he has been on the Board of the Licensing Foundation, the past three years as its President. He has served on the Board of the National Inventors Hall of Fame Foundation.
He has B.Sc., M.Sc., and Ph.D. degrees in engineering, and an M.B.A. Dr. Razgaitis has been a registered Professional Engineer in Texas, Oregon and Ohio, and is an inventor on four patents. He and his wife have been married 40 years and have five children.
Abstract
Pricing the Intellectual Property of Early-Stage Technologies: A Primer of Basic Valuation Tools and Considerations
Abstract:
This chapter introduces technology managers to certain key issues and to six methods of valuation and pricing. The value of a technology to a buyer (licensee) depends upon how it is to be commercially employed, taking into account the cost of development, the time the technology takes to generate returns, the extent of such financial returns, and the risk involved in the process. At the time of a licensing/sale transaction of an early-stage technology many, perhaps all, of such factors need to be assessed and quantified by making judgments about how the future will unfold with respect to the technology being developed. This assessment and forecast assessment are the essence of all pro forma business models. Valuing license rights for early-stage technologies is in this sense no different than making other future business forecasts, though the details may differ because the forecast time horizon may be longer, the uncertainties may be greater as to the market size and profitability, the operating performance of the technology as it will be used in commercial operation may be less well defined, and other factors. The price paid for a technology transferred between parties is the amount of money (present and future) and/or the financial value of noncash assets given in exchange for the transfer of the technology, which can only occur if both the seller (licensor) and buyer (licensee) have by some process reached a common, present understanding of value that makes agreement possible.
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