Higher Education Research Commercialisation Intellectual Property Framework – a tool to increase collaboration and partnerships between industry and universities

Most Australians are aware of the strength and quality of our nation’s research sector, particularly in fields such as life sciences and medical research. Never has this been more evident that during the COVID-19 pandemic, when Australians could, quite rightly, be proud of the role that Australians researchers played in the global efforts to develop safe and effective COVID-19 vaccines, diagnostics and therapies.

Despite the quality of Australian research, policy-makers continue to grapple with the very real challenges that Australian researchers face to commercialise their research, and deliver much needed innovations to the community. Similarly, industry partners often struggle with the inevitable delays that can arise when negotiating partnership agreements with research institutions, particularly when there may be a lack of understanding of the dynamics of the global operating environment that these companies operate within.

As a result, it is often costly and time consuming to negotiate and implement commercial or collaborative arrangements between research organisations and industry partners. In response, the Department of Education, Skills and Employment have developed the Higher Education Research Commercialisation Intellectual Property Framework (the Framework) in an effort to reduce the cost, time and complexity of commercial intellectual property (IP) negotiations.

The Framework seeks to promote commercialisation of research by, and encourage collaboration between, research organisations and industry partners. It provides stakeholders with template contracts in relation to common activities, such as collaborative research, confidential discussions, and IP licensing. These contracts have been developed in consultation with IP lawyers, IP managers, university researchers, university technology transfer offices, large and small business, start-ups, investors and government. The intent is to develop a framework that is reasonable, and strikes an appropriate balance between the interests of all parties involved in a proposed partnership.

The scope of the Framework

The Framework consists of 12 template agreements along with an overarching practical guide to commercialisation, IP and using the Framework. The practical guide identifies five stages to commercialising IP (identification and protection, development, provision of services and equipment, licensing and then selling), summarises the key commercial concerns, and provides guidance as to the most appropriate template for the intended transaction.

The template agreements attempt to capture everything from confidentiality and non-disclosure agreements, to high-risk collaborative research. The template agreements comprise:

• a mutual confidentiality agreement for when parties wish to discuss a project before committing to it;
• an IP assignment agreement (for selling IP);
• a number of IP licence agreements (including for low-risk transactions, non-exclusive and exclusive agreements);
• agreements for the procurement of goods and services (such as equipment licensing, acquiring technical or other consulting services);
• a material transfer agreement for use prior to entering formal licensing arrangement;
• collaborative research agreements; and
• standard variation agreement templates.

Each template is accompanied by a plain English guide that explains the reasoning behind, and flexibility of, certain clauses, which may be useful to those new to IP commercialisation.

The Framework recognises that projects will vary in risk and complexity, and provides accelerated terms for low-risk and standard terms for high-risk research collaborations. The practical guide indicates the monetary value, potential risks, and potential indemnities and warranties, that should be considered when deciding between the accelerated and standard agreement.

While the practical guide recommends use of the standard research agreement for high-risk research collaboration, if in doubt or undertaking a high-value or high risk project, we recommend obtaining advice on whether a bespoke agreement would better suit the project (or whether the standard research agreement should be further tailored for your specific circumstances). Whilst the template agreements are a useful tool for managing costs, the templates are not a substitute for legal advice.

Outside the scope of the Framework

The Framework may become an initial port of call for discussions between stakeholders or serve as a compromise position for stakeholders engaged in negotiations relating to a transaction. The Framework’s educational materials may also, if utilised, reduce the stakeholders’ reliance on external advisers. Though the availability of standard documentation and educational materials does not eliminate entirely the need to obtain legal advice.

We also note that the following commonly used agreements have not been included as part of the template agreements in the Framework:

• a non-exclusive equipment access agreement (as some specialised equipment is often shared between departments and/or affixed to the ground);
• a data transfer agreement, as the transfer of data on its own is becoming more commonplace; and
• a material transfer agreement for use with biological materials.

That said, we appreciate that the exchange of data and biological materials can often be more complex, such as where proprietary cell lines or mouse lineages are involved, and it may not be feasible to develop a standard document each of the transaction types. Further, given the additional risks and privacy law considerations that may apply to data transfer, it is recommended to obtain legal advice.

Further, there are circumstances the Framework does not fully consider, including where:

• improvements may be made to a stakeholder’s pre-existing IP rights or the IP developed during the project, as the default position proposed in a Framework template may not be suitable;
• in relation to research agreements, where one of the stakeholders is based overseas and there are different IP rights in that jurisdiction, such as professors’ privilege;
• how the research organisation’s personnel are affected by its affiliation with another organisation, or where a student from another university will be involved, both of which could affect IP ownership;
• where a project is funded by a grant that has attached obligations, as there does not appear to be a mechanism for incorporating such obligations into a Framework template;
• where a stakeholder wants to transfer human or other biological materials and additional regulatory obligations may apply; or
• for equipment access, where the equipment a stakeholder wants to use needs to be shared with the other’s personnel.

Additionally, some stakeholders may prefer to use their transaction-tested templates, rather than a template agreement within the Framework with which it is unfamiliar. However, it is important to recognise that the Government’s intent with this Framework is to create a basis for commencing negotiations, to reduce the time spent negotiating non-contentious, standard or boilerplate commercial terms.

Key Takeaways

The Framework may assist in reducing the cost, time and complexity of putting commercial or collaborative agreements in place, and ultimately increase technology transfer and commercialisation. However, given the array of subject matter and IP rights that may be involved in commercial transactions, standard documents are unlikely to replace agreements developed by industry partners and research organisations that account for their particular needs. In the event other templates are used, the Framework may illuminate unfavourable terms or otherwise act as a guide to ‘best practice’ in certain circumstances.

The Framework templates are flexible, and addresses the common activities in which research organisations and industry partners engage. The practical guide also go a long way to educating individuals about the nuances of commercialising IP.

If you are considering a commercial or collaborative project, or are unsure whether the Framework is right for your transaction, please contact us.

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Authored by:

Kelly Griffiths, Partner
Raisa Blanco, Senior Associate
Clare Cullen, Associate