KEEVEY-KHOTARI, Simon

Abstract: An option to acquire rights in university intellectual property (IP) may be encountered in several guises: as a stand-alone agreement, as a clause within an agreement (for example, a sponsored research agreement or a material transfer agreement), or as a “pipeline,” or IP framework, agreement for a university spinout company. Although the grant of an option may often form quite a small part of a larger agreement, the grant can raise important issues in terms of an organization’s IP commercialization strategy. This is especially true of pipeline agreements that are, effectively, a specialized form of option agreement. The purpose of this chapter is threefold:

1. to provide an introduction to options, and their uses, and including legal, practical, and negotiating issues
2. to provide suggested templates along with guidelines concerning completion of the templates
3. to consider and discuss some of issues that are problematic or of particular concern to universities.

The chapter attempts to provide information that is useful for both the beginner and the experienced research-contracts or technology transfer professional. The breadth of material covered may give the mistaken impression that university contracts are wrought with legal and commercial difficulties. Usually, this is not the case. But sometimes differences of expectation, practice, or legal culture can arise between parties negotiating an agreement, particularly in international transactions.