Home > Topics > Technology and Product Licensing > In-Licensing Strategies by Public-Sector Institutions in Developing Countries > Editor's Summary, Implications and Best Practices

In the post-TRIPS environment, leaders in developing countries who seek to improve economic development and public health are advised to be well-versed in the details of global IP management. Unlike the past, today no country can comfortably remain isolated from the global IP system. Yet among many public sector institutions in developing countries, knowledge of IP licensing practices is often insufficient to deal with the complexities of IP management, particularly in the fields of biotechnology and pharmaceuticals. To address this gap in expertise, this chapter lays out, succinctly yet comprehensively, several of the important features of in-licensing agreements, some common problems faced by developing countries in constructing and implementing these agreements, and ways to avoid these common pitfalls.

In-licensing is a useful, if occasionally complex, method for brining technologies into the public sector through patent license agreements with the private sector. Although the interests of the private and public sector entities involved in these agreements will almost necessarily be in tension, it is possible for a well-crafted license to allow all parties to feel as though they have benefited from the agreement. From the public sector perspective, the goal is ultimately to provide a product (be it a vaccine, drug or new agricultural crop) to people who would not have access to it without government support.

Good IP transfer agreements can help two parties work together to develop a new product. These agreements should address a number of key aspects:

• Confidentiality, which is usually guaranteed through a confidentiality/nondisclosure agreement that both protects useful information and indicates the value of that information
• Material transfer, addressed in an agreement that stipulates exactly how material can be used and by whom. The author suggests using the standard MTA developed by the U.S. National Institutes of Health
• Development/co-development, including specifications on whether agencies will collaborate to test, develop, or produce new products

When one party wants to use the propriety materials or know-how of another party, a technology licensing agreement is needed. Thus will include, at a minimum:

• Confidentiality provisions
• Territorial exclusivity, limiting the region where the licensee can sell the product
• Product liability provisions, which are especially important given the susceptibility of products such as vaccines to liability concerns
• A determination of up-front fees and royalties
• Arbitration procedures, or what happens if things go wrong

The good news, for developing countries, is that legal expertise is often locally available, since many firms are already familiar with basic licensing procedures. The trick is to put this knowledge in the service of public officials to develop a comprehensive and effective plan to license and develop much needed technologies. Among the strategies offered to developing countries in this chapter:

• Develop a business strategy that balances the needs of the public sector with the needs of the private sector
• Develop a marketing strategy the prices products realistically, and make arrangements for good market research to be done to aid in valuation
• Form partnerships with other suitable agencies to help manufacture and market new products
• Make sure legal, business and scientific experts are working together for optimal success
• Establish, as a important initial step, a national technology transfer office

Currently, some private sector biotechnologies companies may fear working with government agencies in developing countries, assuming that these officials will be inefficient or inexperienced in the art of IP licensing. However, with proper training and education, this chapter suggests, public sector entities in these countries will be well equipped to negotiate the global IP system, with the ultimate benefits accruing to their citizenry.

Key Implications and Best Practices

Given that IP management is heavily context specific, these Key Implications and Best Practices are intended as starting points to be adapted to specific needs and circumstances.

For Government Policymakers

• The establishment of a national technology transfer office and the assembly of a core of team of IP experts (who have been trained to negotiate licensing and other technology transfer agreements) is now a national priority for most developing countries. Effectively connecting to the rapidly expanding global market place depends on such an investment.
• Work to establish policy, law and institutions that foster public-private partnerships with organizations in both developing and developed countries.
• Encourage government officials to become more aware and versed in intellectual property and its central role in national development.

For Senior Management (university president, R&D manager, etc)

• Work to formulate institutional policies and guidelines that foster business and marketing strategies and build proper legal expertise.

For Scientists

• Be careful how, and with whom, you discuss your research as that information may be covered under a confidently agreement and disclosure may compromise future licensing opportunities.

For Technology Transfer Officers

• In addition to building a system of best practices in IP management in your institution’s technology transfer office, advocate for the establishment of a national IP management, technology transfer office, one of the roles of which will be to build IP capacity at the institutional as well as the national levels.