Industry-academia collaboration has great potential to create innovative technologies and products by combining the advanced research of universities with the commercialization know-how of companies. In recent years, with support from the government, the number of joint research and technology transfer cases has been increasing year by year.
However, on the other hand, Troubles related to intellectual property (patents) never end. Cases such as ``When I tried to apply for a patent for the results of joint research, I had a dispute with the university over ownership of the rights,'' or ``The timing of publishing the paper was not right, and I was unable to obtain a patent.'' Such cases are not uncommon.
Many patent troubles in industry-academia collaborations arise from lack of prior arrangements or miscommunications on both sides. In other words, many problems can be prevented by having the right knowledge and signing an appropriate contract.
In this article, we will summarize the reasons why patent problems tend to occur in industry-academia collaborations, and then provide a comprehensive explanation of practical information, including 5 checkpoints that companies should keep in mind, examples of actual problems, and even the benefits of consulting with a patent attorney.
Table of Contents
Patent troubles in industry-academia collaborations are not simply caused by "defective contracts." At the root of this is the structural difference between universities and companies. Let's take a closer look at the three main reasons why problems often occur.
For companies, the purpose of joint research is toobtain profits through commercialization. The ultimate goal is to translate research results into products and services and secure a competitive advantage in the market. Therefore, there is a strong incentive to use the technology exclusively and not to let competitors use it.
On the other hand, the purpose of universities is to publish academic results and return knowledge to society. Researchers write papers, present at academic conferences, and contribute to the development of scholarship as evaluation criteria. Patents are just a form of result, and having a monopoly on them is inconsistent with the university's mission.
This difference in purpose createsfundamental conflicts in negotiating the attribution of rights and the scope of use. Companies want to use the technology exclusively for themselves, while universities want to give back to society at large.If joint research begins without bridging these gaps, problems will arise even after results are produced.
Comparison of objectives between companies and universities
Companies: Commercialize research results and establish competitive advantage. Desire for exclusive use of patents.
University:Publishing academic results and returning knowledge to society. Paper presentation and researcher performance evaluation are important. Many companies have a policy of broadly licensing patents.
Understanding this fundamental difference in objectives and carefully adjusting them at the contract stage is the first step to preventing problems.
| Comparison item | Company | University |
|---|---|---|
| Final purpose | Commercialization/profit acquisition | Academic contribution/knowledge return |
| Attitude toward patents | I want to use it exclusively | I want to license it widely |
| Priority of publication of results | Prioritize confidentiality | Early publication preferred |
| Evaluation criteria | Sales/market share | Number of papers/number of citations/awards |
| Time axis | Short to medium term (product release) | Medium to long term (basic research) |
Another major difference between companies and universities is thatuniversities do not themselves implement (commercialize and sell) patents. In the case of joint research between companies, there is a possibility that both parties will implement the patent, so a certain balance can be achieved by an arrangement in which each company can freely implement the shared patent.
However, in the case of universities, even if they have patents, they do not create products themselves. Therefore, the value of patents for universities lies inlicense income. It is common for universities to receive compensation from companies in exchange for not implementing their patents, which is called "non-implementation compensation," but problems often arise over the amount and conditions of this compensation.
Universities may also license shared patents to third parties, including competitors of the company. This is a situation that companies naturally want to avoid, but universities often show resistance to restrictions on third-party licenses due to their policy of ``giving back to society at large.''
Many universities have prepared templates for joint research agreements between industry and academia. Companies, especially small and medium-sized enterprises and startups that are conducting joint research with a university for the first time, sometimes sign a contract without fully considering its contents, thinking that there will be no problems because the contract was prepared by the university.
However, university template contracts often have terms that are advantageous to the university. For example, some cases include clauses such as that all results of joint research belong to the university, that the university can freely license it to third parties, and that there are no restrictions on the publication of papers.
For companies, if they accept these conditions as is, they may find themselves in a situation where they are unable to fully utilize the results despite investing a large amount of research funds. The contract is the starting point for negotiations, and while using the template as a base, it is essential to have a firm negotiating stance on important points for your company.
⚠ Risks of template contracts
The university's template contract is created with the premise of protecting the university's interests. If clauses such as ``results belong to the university,'' ``free licensing to third parties,'' and ``no restrictions on publication of papers'' are included as they are, there is a risk that companies will not be able to fully utilize the results even though they are responsible for the research costs. Be sure to have your contract reviewed by an expert to clarify the points that need to be negotiated.
In order to prevent patent problems in industry-academia collaborations, it is extremely important to thoroughly confirm and negotiate important matters regarding intellectual property before entering into a joint research agreement. Here, we will explain in detail the five checkpoints that companies must keep in mind.
✅ Check 1: Patent attribution
A clear agreement will be made as to whether the university or the company will own the patent rights for inventions resulting from joint research, or whether they will be shared. The form of attribution is the issue with the greatest business impact for companies.
Patent ownership isthe most important negotiation pointin industry-academia collaboration. It is necessary to clearly define who holds the patent rights for inventions created as a result of joint research. There are three common attribution patterns:
(1) Sharing:A pattern in which universities and companies jointly hold patent rights. Although this is most common, there is a provision in the Patent Act that states that shared patents cannot be licensed to a third party without the other party's consent, so a separate agreement on licensing policy is required.
(2) Sole company attribution:This is a pattern in which a company holds patent rights solely. Companies have the highest degree of freedom, but universities are forced to part with their research results, so they often require appropriate compensation or licensing back conditions.
(3) University sole attribution:This is a pattern in which the university holds the patent rights independently and licenses it to companies. For companies, the ability to secure exclusive licenses is an important point.
💡 Negotiation points
In the case of co-ownership, be sure to specify not only the ownership ratio but also the handling of "license rights to third parties." According to Article 73, Paragraph 3 of the Patent Act, it is not possible to license a product to a third party without the consent of the co-owner, but it is possible to stipulate otherwise in the contract. Companies are strongly encouraged to include clauses that restrict licenses to competitors.
✅ Check 2: Non-implementation compensation
Since universities do not implement patents themselves, this is an arrangement in which companies pay compensation to universities when they implement patents. The method of calculating compensation and the terms of payment are important negotiation matters that are directly linked to profits.
Compensation for non-working is a royalty paid by a company to a university as compensation for the university not implementing the patent (not producing a product) in the case of a shared patent. Under patent law, each co-owner can freely implement a jointly-owned patent, but since universities do not have the ability to implement it, only companies benefit. This is a system to maintain that balance.
There are various ways to calculate compensation for non-performance, but typical ones include a fixed percentage of sales (running royalty) and a lump sum (initial payment). In the case of running royalties, they are linked to sales, so if the product sells well, the compensation will be high.
Companies need to carefully check whether the non-performance compensation rate is appropriate, whether there is a maximum amount set, whether the payment period is limited, and whether the range of eligible products is clear. Ambiguous agreements can become a source of conflict later on.
💡 Negotiation points
The rate of non-performance compensation varies depending on the industry and technical field. Generally speaking, the standard rate is around 1-5% of sales, but some universities may offer higher rates. By setting an upper limit (cap) and including a clause for rate review after a certain period of time, companies can reduce risks.
✅ Check 3: Timing of paper presentation
Publishing papers is essential for university researchers, but if the research content is made public before a patent application is filed, there is a risk that a patent will not be obtained due to loss of novelty. It is essential to adjust the timing of presentation and application.
The timing of paper publication is one ofthe most overlooked, yet extremely important pointsin industry-academia collaboration. Under the patent system, if the content of an invention becomes publicly known before it is filed, it generally loses its novelty and cannot be patented.
For university researchers, publishing papers is the most important issue as it is directly linked to performance evaluation. While I can understand the desire of researchers to ``want to make an announcement as soon as possible,'' what companies really want to do is wait until the patent application is completed before making an announcement.
It is common for contracts to include clauses such as ``We will notify the other party at least XX days before the publication of the paper and discuss whether or not a patent application is necessary.'' Typically, there will be a prior notice period of between 30 and 90 days. The process is to complete the patent application procedure within this period, and then receive permission to publish the paper.
⚠ Risk of loss of novelty
If an invention is made public in a paper or conference presentation before a patent application is filed, the novelty of the invention is generally lost and a patent cannot be obtained. Japan has a "loss of novelty exception" system (within one year from the filing date), but In many countries this does not apply to overseas applications, so you need to be especially careful when considering a global patent strategy. The golden rule is to publish your paper after the patent application has been completed.
💡 Negotiation points
We recommend that you provide at least 60 days for advance notice of your paper presentation. Preparation for a patent application (preparation of specifications, preparation of drawings, internal approval procedures, etc.) requires a certain amount of time. Also, be sure to specify the method of prior notification (in writing or email) and the consultation process after notification.
✅ Check 4: Background intellectual property
We will clarify the handling of intellectual property (background IP) owned by each party before the start of joint research. Blurring the line between joint research results and existing technology can cause serious trouble.
Background intellectual property (background IP) is intellectual property owned by each party prior to the start of the joint research. Examples of such patents include patents related to manufacturing technology owned by companies, and basic technologies accumulated through past research by university researchers.
If the boundary between the results of joint research (foreground IP) and background IP is ambiguous, disputes regarding attribution may occur, such as, ``This technology originally belonged to the university,'' or ``No, this is the first result of joint research.''
Additionally, if the use of background IP is essential to implementing the results of joint research, the licensing conditions must be determined in advance. In particular, in cases where a product cannot be commercialized without using the university's fundamental technology, background IP license conditions have a significant impact on companies.
💡 Negotiation points
Before entering into a joint research agreement, it is important tolist and confirmthe background IP of both parties in writing. Also, if the other party's background IP is required to carry out the results of joint research, the license conditions (free or paid, exclusive or non-exclusive, etc.) should also be specified in the contract.
✅ Check 5: Burden of application and maintenance costs
We will clarify the burden of patent application costs, examination request costs, pensions (maintenance costs), overseas application costs, etc. Since costs are incurred over a long period of time, this is an important issue that is directly connected to budget planning.
Obtaining and maintaining a patent ismore expensive than you might think. Even for domestic applications, application fees, examination request fees, registration fees, and an annual pension (maintenance fee) are required. When considering overseas applications, it is not uncommon for each application to cost several million yen, including translation costs and agent fees in each country.
In the case of shared patents, if there is no agreement in advance how to share these costs, complaints may arise such as ``the university does not want to bear the cost'' or ``it is unfair that the university also has the rights when only the company is paying the cost.''
Generally, there are many cases in which the cost is borne according to the ownership ratio, but there are also many cases in which the company actually bears the entire cost. In such cases, it is important to negotiate to secure rights (exclusive licenses, etc.) that are commensurate with the company's cost burden.
💡 Negotiation points
When negotiating cost sharing, consider not only domestic application costs but also international application costs when negotiating. You can also prevent future disputes by determining how the equity will be handled in the event that one party waives the cost burden (such as transferring the equity to the other party). In particular, since maintenance costs last for a long period of time, the rules for waiving rights midway are also important.
| No. | Check items | Main points to check | Risk level |
|---|---|---|---|
| 1 | Patent attribution | Sharing or sole ownership, ownership percentage, third-party license availability | Most important |
| 2 | Non-implementation compensation | Pricing rate, maximum amount, payment period, range of applicable products | Most important |
| 3 | Paper presentation timing | Advance notice period, consultation process, permission to publish after application completion | high |
| 4 | Background IP | Listing existing IP, licensing conditions, boundaries with results | high |
| 5 | Application and maintenance fees | Cost burden ratio, overseas application fees, rules for waiver | medium |
Here, we will introduce two typical trouble cases that can actually occur in the field of industry-academia collaboration. All of these cases could have been prevented with appropriate contracts and proactive measures. Please apply it to your own company's situation and use it to identify risks.
A small and medium-sized manufacturer, Company A, was conducting joint research on new materials with a national university laboratory, B. The research was progressing smoothly and groundbreaking results were being obtained. Company A planned to apply for a patent on this result and commercialize it as a new product.
However, an associate professor in Laboratory B ended up presenting his research results at an international conference without consulting Company A. As an associate professor, I wanted to meet the submission deadline for an important academic conference, but this presentation made the content of my invention publicly known.
In Japan, there was a possibility of filing an application if certain procedures were followed due to the "exception to loss of novelty" system, but it became impossible for Company A to file an application in Europe or China as it had planned. As a result, Company A was forced to drastically review its global patent strategy, causing it to lose its competitiveness in overseas markets.
⚠ Lessons from this case
This problem could have been avoided if the joint research agreement had clearly stated ``obligation to give advance notice of papers/conference presentations (at least 60 days in advance)'' and ``a grace period for presentations until the patent application is completed.'' It is important to include a publication approval process through the university's intellectual property departmentinto the contract, so that researchers cannot make publications based on their own judgment.
Startup company C launched its business based on the research results of Professor D from a famous private university. For the joint research agreement, we used the university's template almost exactly as is, and the patent was shared between the university and the company. Regarding compensation for non-implementation, the only vague statement was that it would be discussed separately.
When Company C's product became a success in the market and sales grew rapidly, the university's TLO (technology transfer organization) demanded a high compensation of 8% of sales. Company C felt that this fee rate was unreasonably high because it had borne most of the research costs in-house and had also developed its own technology for commercialization, but since the contract did not include a specific fee rate, negotiations were difficult.
In the end, after long negotiations involving patent attorneys and lawyers, the fee rate was reduced, but the business plan was delayed during the negotiation period and a large amount of legal fees were incurred, which was a major setback for the startup.
⚠ Lessons from this case
The conditions for compensation for non-performance should not be ``separately discussed'', but the specific rate, maximum amount, and payment conditions should be specified at the contract stage. Especially for startups, promising high royalties when future sales are uncertain can put the very survival of the business in jeopardy. Consider setting a tiered rate or a maximum amount depending on the size of sales.
In order to prevent intellectual property problems in industry-academia collaboration, the involvement of an expert patent attorney is extremely effective. Here, we will explain three major benefits that you can get by consulting with a patent attorney.
Benefits of contract review
Patent attorneys are experts in intellectual property law, including patent law. We can accurately identify the risk clauses for companies that are hidden in the template contract provided by the university, and can suggest amendments. We review intellectual property provisions from a professional perspective, such as patent attribution, compensation for non-performance, restrictions on third-party licenses, and the scope of confidentiality obligations, and make specific amendment proposals to protect a company's interests.
Advantages of negotiation support
University TLOs (technology transfer organizations) and intellectual property departments have extensive experience in intellectual property negotiations. If the company does not approach negotiations with the same level of expertise, there is a risk of being forced into less favorable conditions. A patent attorney can suggest reasonable compromises based on industry trends and past negotiation cases. Additionally, since we are able to provide legal advice based on our understanding of technical matters, we also function as a bridge between engineers and the legal profession.
Advantages of building a patent network
In order to make the most of the results of joint research, strategic patent filing is essential. A patent attorney can identify inventions that should be protected as patents from among research results and create a strategy for constructing apatent portfolio that includes not only basic patents but also peripheral patents and improvement patents. We will also formulate an application plan from a global perspective, including the timing of domestic and overseas applications, utilization of PCT international applications, and strategies for acquiring rights in each country.
Industry-academia collaboration can be a source of great innovation for companies, but there is also the risk that troubles related to intellectual property could undermine the achievements. Let me reorganize the 5 checkpoints introduced in this article.
5 checkpoints for industry-academia collaboration to prevent patent troubles
By carefully checking these points in advance and concluding an appropriate contract, you can prevent many problems from occurring. When negotiating contracts and formulating patent strategies, we strongly recommend that you consult with a patent attorney who is an intellectual property expert.
In order to make industry-academia collaboration truly valuable, let's not neglect preparations in terms of intellectual property.
Would you like to prevent patent troubles in industry-academia collaboration in advance?
Our intellectual property experts provide one-stop support, from reviewing joint research agreements to negotiating non-performance compensation and planning patent application strategies.
Please feel free to contact us first.
AUTHOR
Takefumi SUGIURA （杉浦 健文）
EVORIX Intellectual Property Law Firm Managing Patent Attorney
Supports clients across IT, manufacturing, startups, fashion, and medical industries, covering patent, trademark, design, and copyright filings through trials and infringement litigation. Specialized in IP strategy for AI, IoT, Web3, and FinTech. Member of the Japan Patent Attorneys Association (JPAA), Asian Patent Attorneys Association (APAA), and Japan Trademark Association (JTA).