Comprehensive Guide to Licensing-Based Business Models for Innovators

hello everybody and good afternoon and welcome to this session on licensing based business models uh my name is Tom

with I'm with the European patent office and this event is organized in cooperation with the European Innovation

Council and it's hosted by the European IP help desk quick bit of um housekeeping before

before we get started this event will be recorded and the event so the the recording should be available to few to

view in some some weeks and if you have any questions please feel free to put them in the chat at any point we will

have dedicated question and answer sessions at the end of each um each each so I'd like to formally open this I

have two colleagues one from the EIC one from the EPO so vekka from the EIC and then Patrice pel from the EPO um verel

the floor is yours for the words of welcome thank you thank you Tom and good afternoon everybody and welcome uh to

the to um thisam training licensing based business models um this training um is co-organized by uh EIC EPO and

European I health desk um in a very good cooperation I uh I must say and it shows really the power of cooperation and and

and synergies and how you know by just joining forces we can reach to more of you and and and have more impact uh this

training is oriented towards the AC beneficiary or at least from our point of view but open to every uh European um

innovator because we think that the uh the questions the problems are um very similar if not really similar for the

One Vision is simple yet powerful or at least we think so from idea to the market we provide support to your ideas

uh or or via Pathfinder previously fat or future emerging technology then via the transition we provide uh further

support uh towards Innovation and and and the market um but not only if you come from Pathfinder or previous fed but

also from ERC from pillar two of horizon Europe um even from fed flagships and and so on and with accelerator we

provide closer to the market support from TRL six onwards with both uh grants and and Equity um recently with uh for

for focused on transition and and with the support of a colleague from JC we did a recently an impact report and one

of the findings not the only one but perhaps the one uh surpr a bit surprising and relevant for today was

that licensing as a pathway to Market was not considered much by uh transition beneficiary and and even some uh some

applicants and again remember applicants are coming from outside from from the whole world war program um hence the the

natural recommend recommendation was to inform beneficiaries about and applicants about licensing and other un

Market entry strategies as alternative or even complement to more established Pathways to Market like you know

creating Spinners of of of direct exploitation which we we like as well no worry uh so depending on the exact case

this could potentially increase uh speed and and reduce the cost of bringing Innovation uh to the market but of

course licensing can also be combined with creation of a spin-off and or direct uh direct exploitation so we

think this would be useful not only for uh transition but also for Pathfinder accelerator ERC and many researcher in

Europe looking to um you know exploit your your research result so that's why we decided to make this public and

disseminate as wide as possible it is really great to see so many participants and um I Wishful I wish you a very

fruitful participation and please do not hesitate to let uh to let us know your your feedback thank

you thank you Fel Patrice representing the EPO yes thank you very much Vel for for

your introduction you know that the European patent office and the European Innovation Council have a long-standing

tradition of partnering uh we want to support innovators and entrepreneurs across

Europe we started cooperating back in 2020 2 and we formalized this with a letter of

intent with esma but with a clear uh a clear support to the EIC through the uh support that the EPO examiners uh

provide uh to the evaluation of EIC proposals additionally uh in 2023 the patent Academy joined forces to offer

targeted course tailored to the needs of the I beneficiaries and I'm very happy to say

that the first major event that was uh held it was the licensing as an exit strategy for the EIC beneficiaries had

an overwhelming response with four 500 registrations and many more have uh and many more afterwards uh after the

recording then this was also followed by the publication of an um of an Open Access article named empowering the

licensing capabilities of the EIC defended startup companies which recently ranked in the top 10 downloads

on the social science research Network today's event Builds on this success offering a further valuable

insight and training at the EPO We Believe supporting innovators goes beyond the ground of patents and means

also valorization as a critical step to unlock the full potential of Technology

licensing is of course one of the key Tools in this process and I'm thrilled that we can offer this training today I

hope you find today's sessions valuable and I do look forward to welcoming you at the future European patent Academy

events thank you very much super thank you both those very kind words words of welcome so without

further Ado let's get into the main meet the meet of the session should you say uh as I said if you would like to put

any questions uh please feel free to put those in the chat throughout through throughout the whole the whole event and

I said there are question and answer sessions after each each each part so without further Ado I'd like to pass you

over to my colleague at the EPO Christian Salman to talk about introduction to licensing Christian the

floor is yours thank you Tom uh very much for the introduction I hope you can hear me also

welcome on my side and the pleasure to be with you uh today to uh to shed light on different aspects of Licensing today

we will start with a brief introduction to licensing it's just a teaser to to allow you to understand the principles

the context in which licenses matter some some dos and don'ts and uh you will hear more about details during the

presentations of the experts later today when we talk about um when we talk about uh licenses I think it's good to

take uh the helicopter view first in order to see bit the context in which uh licenses matter um let's take an example

uh for example the example of a technology that you develop in uh in the laboratory yeah let's maybe start with

an example I took the example of uh additive manufacturing uh just look at this image here a set of different

aspects that matter when you develop products or services in that area of course you develop devices you develop

materials but that's not all this is what we as scientists and Engineers think about but when you look closer at

the product development process in startups in companies in Industry there's much more we um in the

laboratory take care of for example we do design work because we develop the outer experience of the product it's not

a raw product that will be sold on the market uh there are other technologies that matter maybe exchange of

information with computers or other devices in in a workshop or factory then programming matters a lot uh graphical

and acoustic work when you exchange information with the users for example someone operating a 3D printer and of

course when you go to the market and try to stablish a relationship with customers or future customers then much

more matters branding you will use logos product names you will have to develop product videos web pages photographs and

and much more today you may be in the laboratory uh the next step in your career is of

course uh to be successful on the market you try to bring a product or service to the market so let's take the example

again of this uh uh additive manufacturing device which is surrounded by some some some uh out experiences um

you have software you that you would like to bring to the market uh manuals explanations documentation

Etc this is where you want to be either you would like to use your own technology and be successful on the

market yourself or you may enter into a relationship with other others in case you are not uh able or willing for

example to commercialize the technology yourself and of course this is a commercial activity um at first sight it

may look like a piece of cake so of course it's a there risk commercial risk you take uh you need to take actions you

need to uh choose markets establish legal relationships but this is especially a special

situation because you deal with knoow with intellectual assets and uh it's not a straightforward exercise to to bring

them success successful to the market rather than a piece of cake at a slippery Road and that's due to the fact

that your products your services will be based to a large extent on knowhow and information and typical for knoow and

information is that they can reproduced from a technical point of view by everyone usually at moderate cost so if

someone takes it copies it it creates an competitive Advantage for them because they don't need to develop themselves

can simply take the results of all the work you did of all the Investments you did the educational effort that was

necessary to arrive at the technology and second once information is available to the public it's from a technical

point of view not possible to exclude others from using the knowledge and the knowhow um and that creates really a

barrier for you and an extra risk that you would not have if you were just commercializing physical items of

physical property fortunately there's a variety of so-called intellectual property rights that help you to secure

your investment in the knowhow in other intellectual assets it's the set of intellectual property rights um for

different aspects of the knowhow and other intellectual um assets here you can see a list of major intellectual

property rights that help to support you in commercializing uh your nor how first of

all uh in the area of Technology patterns really matter uh patterns are legal rights that are granted for new

technical inventions uh usually um uh after uh substantial application and examination procedure uh such patent

will be granted allowing you to exclude others from certain commercial actions I will use patents as an example in a few

seconds second uh there are other things you create um uh work that is created original creative and artistic forms

text videos uh but also software code copyrights start to exist automatically at the moment when the work is created

then their trademarks they address um signs which you use to exchange information with your customers or

future customers um they help to protect distinguish uh distinctive signs that help to identify your product and

services and allow the customers uh to distinguish them from the product and services of others on the market um

trademarks are usually obtained by a formal procedure um uh um as are designs which help to protect the external

experience for example the outer shape patterns Etc uh which are obtained using registration uh there are unregistered

designs as well which are also useful um in specific situations and then last but not least Trade Secrets which help to

protect valuable information which is not known to the public so for example confidential information how you can

operate a machine to uh reduce the error rate um as uh the requirement to have meaningful trade secret protection is

that you take reasonable efforts to keep the confidential and valuable information secret this is these are

just the main um intellectual property rights I would like to mention here there are others also important and the

purpose is really to support you in securing uh your intellectual assets and make sure that you can tap the benefits

from it you who created uh the these assets let's take the example of patents just to illustrate it a little bit

further before we come to to licenses um patterns very important in in any area of of uh technology help to protect

technical inventions um formally speaking a patent is a legal title which grants the patent holder or holders uh

the exclusive right to prevent others from taking commercial actions with the technology protected by the pattern so

it's not an active right having a pattern doesn't mean that you can can use the technology on the market in some

areas there are um legal restrictions you need authorization first but it's an exclusive right but it's a very

important right of course uh the principle of territoriality applies to patterns and also other intellectual

property rights a pattern is valid in those countries for which the pattern was granted so the fact that a pattern

on a specific technology was granted for France does not mean that it will um uh prevent your commercial actions based on

the technology in Italy yeah so the fact that a patent was granted for France means that there is patent protection

possibly in France but not necessarily other elsewhere yeah that mean that uh in Italy there may not be patent

protection but based on the legal title it's limited to those countries for which it was granted and is still valid

so patent exists for limited period of time in Europe up to 20 years as of the date of

filing and second condition if the patent is still valid and that can that means that the uh fees for for

maintenance are paid it's not rendered invalid and it's very important if you see a patent that you really make sure

that the patent is still valid before you draw conclusions from the situation patterns are limited uh to uh commercial

activities there are some exceptions and limitations Supply also very important so private use is Exempted from from

patent protections so is uh research on the protected technology okay so this is an example of

an intellectual property right uh that may be very important in your own area intellectual properties I mentioned it

help to secure your intellectual uh assets and are a very important ingredient to to be successfully on the

market um you need to develop an informed strategy regarding which intellectual property rights should have

it should be based on the markets you would like to address so geographical scope of your activities and other

aspects as well and the intellectual property strategy so which intellectual property rights you need at which stage

for which purpose will support your business strategy it's not a value in itself it supports your business

strategy which means how do you want to commercialize something and there are two options basically you may use

intellectual property rights your own on your own because you would like to commercialize your products and services

yourself or alternative is that the intellectual property rights may be used by others so others may use your

intellectual assets for which there are intellectual property rights that secure these these assets and there are two

options here if someone else is supposed to to to to to use them first you can transfer fa your rights for example by

selling it and transferring it for example to a spin-off company or second to offer a license to enter into a

license agreement and that will be the main focus of the event today yeah what is a

license essentially we have two parties the IP owner the licenser the so-call license from a legal point of

view and someone who wants the license license see for example in another company or spin-off um and the license

now has two aspects first it grants the permission to the license he to use the intellectual asset and in return that's

at least typical there will be compensating means so the licy will pay royalties based on many different models

you can choose in order to Define how uh this return will will be paid the

basis is a license agreement which specifies the terms under which the licens he can use the intellectual uh

asset of the license or for example a technology protected by an intellectual property right such as a patent and also

very important is that uh with a license licenser Remains the owner of the intellectual

asset there are different kinds of licenses first of all uh you can license out by and that's the case I just

described by granting permission to use the intellectual asset and granting the permission to someone else main um main

motivation is to create a revenue and to leverage unused or underutilized intellectual Assets in your

portfolio can also have the opposite direction so if you take the perspective of a licens you as a company for example

as a startup would like to acquire the right to use intellectual uh assets of other parties for example because you

would like to get quickly access to external technology or other intellectual assets to save time uh in

many cases also to save money because developing things on your own can be very time consuming and also very costly

and then there are mixed forms of cross- Licensing allowing between the two parties entering into a license uh

agreement uh um establishing permission to use intellectual assets of the other side that helps to facilitate

collaboration between the different parties and in the end mitigates the risk of infringement cross licensing can

have different extent it can go so far as to uh giving access to pools of uh intellectual assets and intellectual

property rights uh at a later stage in one of our presentations we will go into details regarding further motivations to

enter into licens to help you see in which situation in your everyday life licenses may be a very valuable option

yeah that brings me already to the end of the brief introduction to licensing it's a teaser we hope that you can see

now better the context in which licenses really matter and I would like to um hand over back to I think Michela or

Tom thank you Christian you you you you get me um so c a question um does anyone from the audience have any questions yet

um so if you do please feel to put them in in the chat and so then Christian have a question for you is how can I

know if a tech technology is licensed is there some kind of register of patents and or IP licenses available to look at

unfortunately um the situation differs from legislation to legislation so in some countries it's obligatory in most

of the countries it's not information on licenses including for example the willingness to license um is recorded if

a competent office so for example pattern office is informed about it but as in most of the cases in most of the

legislation this information is not mandatory information many pattern owners and

licenses do not report this kind of information so the information is unfortunately little scarce so from a

competitor point of view what you would like to see to see complete set of information on licenses already granted

uh licenses accepted and by whom does not exist at the moment so it's incomplete

unfortunately okay thank you and I have a question just coming from the audience so is licensing only

possible with a granted patent no um you can also establish license agreements with registered

rights for example trade secret information confidential information uh but of course it helps a lot if

basically it's based on um on uh an intellectual property right which can be proved and also can be

enforced super thank you and can we maybe license just part of a patent is that also a

possibility to my knowledge yes yeah I mean because a patent can cover different invent ions so formally

speaking a different set of Technologies can be protected by a patent and you can also then just limit it to part of it to

part of the intellectual asset um uh that is protected by a patent super thank you I think we have

time for one more question um is it possible to license one technology to more than one person or have different

Industries on the same same license yeah there's there's the freedom fre them to establish license contracts for example

you can establish different license contracts for different geographical regions you can uh give licenses to more

than one party you can also establish the um provision that basically the the holder of the the intellectual property

right does not use the technology um uh so there there's a large variety of options that you can use in order to

tailor uh the license agreement to your needs on the part of the licy but also on the part of the license so there are

different commercial business models that can be um covered by by the appropriate license

agreement super thank you very much Christian I see we have a number of other questions coming in but I'm just

conscious of time um Christian we hope you be joining us at the end for the for the general Q&A session so please keep

keep your questions coming in and and we'll collect them all for for the end so thank you Christian I you pass over

to the next session um with Bowman Heiden and Adel vova um Bowman is from the center of intellectual property and

Adel is from the European Innovation Council unfortunately bman was unable to be with us today so we have a a

recording a pre-recorded video for you to watch now well welcome everyone uh my name is

Bowman Heiden I'm the director of the center for intellectual property and today I'm going to go through a brief

presentation on licensing based business models I have a little bit of a cold today so if I have to take a drink once

in a while hope you bear with me thank you because in the knowledge economy or maybe even more maybe more importantly

the digital economy that we talk about nowadays um both digital assets like such as data and and software as well as

knowledge in the form of technology and Brands and design they all share one thing in common they're all intangible

assets that are non-rival and by being non-rival that means that there's an immense opportunity to leverage this

knowledge out into the world because everyone can have it at the same time we can only have one person drive a car at

the same time but we can have many people um have intellectual assets at the same time just like everyone can

have a copy of a of the same song the problem though even though we can leverage this very well the problem

comes when this leveraging is done by others without any authorization so in order to create business in an orderly

fashion it's very very important to be able to to use licensing as a business model to manage the business of dealing

with Brands software and Technology as we will discuss today so I'm going to do a little bit on

branding a little bit on software and talk a bit about technology um and talk a little bit more about technology um

and patent licensing so let's go forward we all know that brands are extremely important um in the economy we

all know that having a brand on your product or your service is incredibly incredibly

important but often times we we mainly focus on having the brand on on our own on our own product in our own service

and don't think about how to use Brands as a way to transfer uh to as a way of commercial

transfer but uh there's many different models that can be used here so we have brand licensing for example when we look

at Phillips excuse me when we look at Phillips you can have televisions that

are made by other actors but but still share the brand and then when we look at

franchising we can have Coca-Cola for example that can make its own um that can make its own beverages under the

Coca-Cola brand but then also have um Coca-Cola be uh licensed out to other

bottlers excuse me in this way Coca-Cola can leverage its brand um and it's um business to

many different actors across many different um uh GE geographies without necessarily having to do all the work

itself and the last Model here is merchandising which uh Star Wars uses um quite

prolifically um star you'll see the Star Wars brand on all kinds of different types of material and in this case you

see their co-branding with Lego now Lego Star Wars also benefits from Lego but I think Lego benefits a bit more from Star

Wars in this relationship now let's move on to software and copyright

licensing anytime you have an artistic work or um software digital photo uh some type of music digital

music there'll be some authors or some artists that produce the music or that that create the music that's usually

given to a producer then to a distributor then to a retailer and then to the customer but the customer every

time that the music is in digital form or if the software obviously in digital form is um the user has to enter into an

an end user license agreement to Define how the user will behave this is what we call a b Toc license so the the user

basically doesn't own this um picture or music or software they have a right to use it under certain terms

and nowadays we don't we don't do this through physical products we do this through the cloud as everyone's aware

but still the principles are the same when I was young uh for those of my age um we would buy soft software in a

physical container we'd open it up we'd have a disc you would own the disc but not the software the software would

would could be used under certain terms and this is the terms of the enduser license agreement which regulates the

customer Behavior nowadays people click when they download an app onto the end user license

agreement we call this the original one we called shrink shrink wrap when you ripped off the the plastic cover and you

entered into this agreement nowadays we call it click wrap because we click on it and now we enter into the agreement

and we see we see that this way of thinking with with copyright this copyright

perspective also moves over into technology in certain areas where the technology itself is

replicating for example when it comes to seeds when you buy seeds that have been genetically modified when you produ

produce the crops then the crops can of course um produce new seeds and those seeds can then be planted again so there

needs to be a license to regulate the behavior when something can be propagated and we see we see the same

thing excuse me we see the same thing when we talk about these enco mice when you buy the

anco mice you also can because they can be replicated as you know they also need to have a an user license agreement and

we call this mouse wrap now let's move on to the technology and patent

licensing as I say say all models are are wrong and some are useful so hopefully this one will be useful uh

Thomas Bera and I put this together a few years ago and it's just to help people to get a basic understanding of

the different models that are possible when thinking about licensing if you look at the upper left

side of the model we talk about Licensing in or licensing for ACC access and when we look in the bottom right we

we look about licensing for Revenue this is about licensing out so the first model is access to

technology here the development partner um is licensing out and therefore the the Technology based

business is Licensing in the a technology that need it needs access to that it likely would be more costly to

develop itself this is typically the arrangement such as in uh blue break where the technology transfer from a

university is done through a license arrangement to a small firm in the second model B we talk more

about working with competitors in freedom to operate this is still Licensing in but mostly to have to have

uh uh to have access to a technology so that you don't infringe on someone's intellectual property rights in relation

to to a technology that's used in your product that you already understand the technology but you don't have the rights

to use when it comes to see this is licensing versus production this is a

vertical commercial relationship this is the typical relationship that actors have when they're deciding instead of

producing the the product or the service itself instead to license to another actor that will take it forward so this

is a classic example in when biotech licenses the big Pharma and in the case here the enco Cure case is a good

example as well and Adela will go through that U briefly in a few minutes and the last Model is a

complimentary licensing this is where an actor is creting its own products and services

but it would like to license in other fields of use or in other geographies to generate Extra Value from its technology

to take advantage of this non-rival nature that we discussed oxion is a great example of this and I'll discuss

that briefly next so most of the time we think of uh techn Tech ology as a portfolio of of

patents or inventions but also we can think of our technology as a portfolio of

opportunities so in the case of oxion their technology was used in multiple ways so from a product sales perspective

doing their own sales they worked in multiple Industries so they use their unique um uh textile technology with the

different fibers and tapes to use in in areas such as um Sports excuse me in areas such as Sports and in um the

in industrial areas as well as as well as um Aerospace in fact they were even on the

um the the Mars rover the recent Mars Rover um with the wings but they also used technology

licensing by field of use so they were able to license out their manufacturing process to make extra value and this was

used early in their development process to help um fund the venture to move to the second phase of their efforts so

here's a great example of this um complimentary licensing strategy now I'd like to hand it over to

Adela to take it further well thanks a lot B um um good afternoon also from my side uh my name

is Adela vova and I'm a project advisor at EIC transition and I will present to you a

little bit more in detail the case of unoc cure that Paul already mentioned in his presentation so unoc cure is an

Austrian biotech company that is active in the in the field of cancer treatment so before we dive into

the IP topics I would like to present to you briefly the technology that onoc cure has

actually developed so that you can better understand the other aspects that we will be discussing later on so the

technology developed by enoc cure is called specific total immune remodulation um it's a platform

technology what does it mean it means that um uh basically you can develop different types of products on the basis

of that technology um in the picture you can see um kind of schematic representation of a

composition of a product uh that is developed based on or that can be developed based on the platform

technology you can see on the left side the module one uh which unoc cure calls the

Warhead uh the module one is uh normally connected to the module two which is an immunogen and uh the function of the

Warhead is basically to deliver the immunogen into specific um cells of immun system to um let's say allow the

immunogen to cause the desired reaction there to treat the cancer um the module one the Warhead is

generic so it always stays the same it doesn't change but depending on the composition of the immunogen you can

basically develop different types of vaccines to treat different types of diseases and not only cancer actually

the technology can be used also for treatment of allergies so it is actually very versatile

okay what is the IP strategy of enoc cure just very briefly um so enoc cure has secured a

broad patent protection of the main elements of the Warhead so the core of the platform as such is protected by a

broad patent portfolio it also keeps some information secret and it also files product patents for some of the

products developed on the basis of the of the technology uh what are the advantage of

the advantages of this model it is that uh this basically allows oncure to multiply the pathways towards product

commercialization what does it mean that means that they are actually developing one of the products by themselves that's

a vaccine to treat breast cancer but they also license out the IP to the platform to other companies and the

other companies are in parallel working on development of other vaccines to treat other diseases so it basically

increases the chances that one of the products or more of them uh will finally enter the

market another great advantage of this is that uh oncure can actually secure uh revenues from licenses from from

licensing and use these revenues to finance its own R&D so their own R&D is actually to a large percentage financed

by the licensing revenues and that in the situation when actually no product is on the market yet at this moment

and another great Advantage is that it actually allows to save patenting costs because in such a situation you can

require your licenses to pay a certain portion of the patenting cost so it also is a cost saving

strategy here just briefly that you have an overview of the patent portfolio of onoc cure so enure has three main button

families on the Warhead from now on we will call them platform patents and it also to the date of drafting of the case

study um it also had two product patents one for treatment of breast cancer and one for gastrointestinal

cancer uh onoc cure generally gives three types of licenses the first one is the by far most common one and it's uh

it's a Target by Target platform license so it's a license that gives um to the licenses the right to use the IP to the

platform for a specific use case so each of the licenses has its own specific narrowly defined field of activity in

which it can actually use the platform um enoc cure can also give uh licenses to complete products and it can

also give non-commercial research licenses which could have the advantage that for example if the lensey comes up

with some improvements of the core technology oncure can benefit from those improvements the licenses are generally

exclusive uh worldwide and they are limited to a very specific narrowly defined use case so that the lenses

basically are not competing with each other now on this slide we see the business and Licensing structure uh it

might seem a little bit complex but I will guide you through this diagram so that you can better understand it so in

the middle you can see three black boxes those are three companies that are to a certain extent um interlined between

themselves we see on the left side a Target Therapeutics in the middle there is enoc cure these two companies

actually have the same co-founders the reason why they are established as separate entities is that as Target

Therapeutics is active in the field of allergies while enoc cure is active in the cancer field and on the right side

we see TG oncology in which onoc cure has actually has a little share as well now the arrows between the

companies represent licensing agreements so between as Target and unoc cure we see two

arrows and that's because as Target Therapeutics is the owner of the platform patent number one and two and

onoc cure is the owner of the platform patent number three so the first thing that these companies have to do in order

to be allowed to do anything is to Grant each other freedom to operate so we see one license from as Target to onco cure

and that's that's the license for patents for platform patents one and two for you in

oncology and the the arrow that is going back to S Target is a back license that onoc cure is giving to S Target on the

platform patent number three and like like this both of these companies can actually use all the three patents in

their field of activity the two arrows pointing downwards from sarget Therapeutics are

licenses uh to all three platform patents uh one of them is um for the use in allergies for for the company alergo

Pharma so you see actually that sarget is not de developing any product by itself but it's it's licensing out to

someone else who is actually developing the product and the second arrow is to Anga this is a license for veterinary

use from onoc cure there is an arrow pointing downwards um to an undisclosed company so we don't know which company

that is and that company is also developing a certain product um that is intended for use in in cancer

treatment and from onoc cure towards the right side we see an arrow to tyg oncology and that is the license for use

in gastrointestinal cancer and TG oncology is further licensing these pattern to apic Inc on whom they are

relying um for the clinical trials so you see that this is a kind of uh a little bit of complex structure that

they have um put in place and that the platform allows them um to create we have agreed with B that that

would be most likely the business model C that boy just presented so basically you see enoc cure is prioritizing

licensing over its own production um which as B also also rightly stated is um is quite a common

practice in biotech because oncure is a small company that has of course a lot of knowledge and all the IP and

everything related to the technology but it might not have the all the skills and experience necessary to actually bring

the product to the market so at some point they will always um actually prioritize licensing over own

production um under the under enoc Cure in the black box you can also see there is there is the product oqr 200 that's

the only product that they are still developing by themselves uh that's a vaccine for for breast caner but it's

likely that at some point there will also be a licensing deal to a bigger company to actually bring the product to

the market and finally briefly about um some licensing Provisions that we would like

to highlight in this case study I will not go too much into detail of that because that will be the topic of

Karen's presentation but um but I think it's also interesting to highlight some good practice that we have observed um

in the company on cure uh so the licensing Agreements are generally not limited only to patents

but they include also secret noow so Trade Secrets and also support for manufacturing why is this advantages uh

well that's because um when you licens out to someone to develop your product and bring it to the market well you

basically share the same objective you both want the product to enter the market and be successful and bring

revenues and therefore you want to give your leny as much support as possible so that they can effectively use the

technology and don't have any any any issues and uh don't have to let's say reinvent the wheel so you want to give

them as much information and support as possible so so that actually it kind of is easier for them uh to work with that

technology they also include back license on Improvement of the Warhead that's actually a very interesting thing

um what does it mean you can imagine all the licenses and also enure as users of the same platform and each of them is

working let's say more or less separately in their own field but they are working with the same technology and

they are developing something on the basis of that and it's likely that in the course of the development they might

come uh come up with some improvements on the core technology and the back license gives um all the licenses and

also oncure the right to use these improvements in case that um yeah that that anybody comes up with something

that makes maybe the Warhead a little bit more more efficient more I don't know cost effective or anything these

licenses these licenses are granted on a worldwide free and non-exclusive basis and of course in non-competing

fields uh one of the advantages that actually enure mentioned in this respect is that this is also a very helpful tool

in negotiations so lenses are actually interested in having these kind of Provisions in the licensing agreements

and for the licenser it's also a great thing because it allows it allows you to kind of continuously increase the value

of your technology uh another interesting licensing provision that I already

touched upon is that the patent costs that are relevant for licenses are borned by the

licenses uh that is important especially when you are still a company that doesn't have any revenues from um from

product sales because it it mitigates the risk that you will be basically sitting only on the costs while having

no relevant revenues so it's something also to always consider that a fair portion of the patenting cost should be

born by the licenses and finally uh the payment structure that is foreseen in the

licensing agreement um basically um forc is that there might be different kinds of

scenarios in the future usually when you set up a licensing agreement you think about the best case uh but it's not

always the case that everything work works out as planned and for that for that reason it's always good to have a

diversified uh payment structure so that you can secure some revenues in all kinds of scenarios so the the agreements

include an upfront payment there are also some Milestone based payments and there is also an anti- shelving fee

foreen we will hear actually quite a lot about the anti- shelving fee because that's a very important provision just

briefly here what does it mean it means that um uh what you want to achieve is that your lense he brings the technology

to the market that he kind of kind of doesn't put the technology on the shelf and an anti- shelving fee allows you to

to collect some kind of minimum Revenue uh minimum royalties in case that the technology actually is not uh brought to

the Market within the specified time frame okay so that would be all about enoc cure for this uh for this moment if

you would like to read the whole case study um you can go to ep. orgas minus studies so the the full uh case study is

available there for reading there is also a podcast related to it and there are also case studies of a similar kind

so in case you are interested to read a little bit more don't hesitate to visit epor Cas minus

studies um and uh I'm looking at the clock and I see that we still have a few minutes left so I suggest that bo uh

comes back to me we can unshare the presentation and I would have actually a few questions to ask B uh maybe we could

have a little discussion together to a little bit broaden the the perspective on the topic broaden The View and also

kind of set the scene for the presentation of Karin that is going to come now about the Practical aspects of

Licensing agreements so what do you think Bo is it fine with you sure let's have a little chat

Adela perfect so my first question would be um well you have presented all those different business models that you can

build uh based on licensing and uh then I presented this specific case of onoc cure and when we

were pre when we were preparing for this session together we had actually a little discussion about whether this is

the licensing model C or maybe a blend between c and d and one could have actually long discussions about that and

it might be it might sound a little bit theoretical so what would be the the Practical um usefulness of this like why

would it be practical for a company to think like that to think about the different models and think about do I

want to fit in the model C or D do I want to have this or that so what is the Practical use of this uh of this of this

model well even though that I'm an academic I I would um advise people not to get too stuck in the models so um the

models are just there to give you a bit of inspiration maybe categorize some ways of thinking um certainly you can do

hybrids between these you can do multiple ones right um when we when we spoke about Anor cure you know what is

the difference between C and D you know typically um the the the technology licensing model or the vertical model is

one where a company is mainly doing their own production or service and then they find extra value or sorry they the

C is when instead of doing their own production and services they license the whole technology out for others to take

it Forward they kind of hand it over and let other people do it whereas in in D they're doing their own products and

services themselves but find Extra Value in the non-rival nature of their technology to give to other people in

specific uses and in geographies so one is more of a main business model where like most biotech firms are not going to

vertically integrate and become full-fledged Pharma companies so they should think about this right from the

very beginning I think they're all thinking about this and of course an extension of Licensing in their case is

for their whole company to be bought right that's just a you know the next step from licensing where the other

company takes all the assets over um so it's just to think is this going to be the main model that we're going to do or

is it going to be an extra model in order to leverage as much value out of our technology as possible does that

make sense that makes perfect sense indeed um well that brings me to another

question because basically um when we think about these different models um I would imagine that um that the value for

our audience in this is basically that you know you give them a kind of structure they they know what options

they have and they can actually decide um at some point what they actually want to do right before you do anything you

have to know what you want to do when would be the right time to uh to start thinking about that so

before you answer my question I will just give you a little bit background about our audience today we will have um

we will have quite a or we have quite a diverse uh spectrum of participants today we will have maybe some research

groups that are working on some early stage Technologies we will have some young companies that are just in the

development we will have maybe some companies that already have the first products on the market or they are now

preparing for the launch so what would you recommend like what would be the the right time to start thinking about the

different business models yeah that's a good question I think um what I always try to recommend

especially for small companies that are just starting or research projects is that the the amount that they need to

get a handle on what are all their important intellectual assets or technology assets what do they have in

total that's valuable and and by that it's a little bit like throwing the Legos out on the

table from there you have a good idea of what you can build right so there you should have professionals come in to

help you to think about intellectual property rights but just to get a basic understanding of all the different

technology assets that you have that as I mentioned our portfolios of opportunities right and by looking at

this um then you can start to think okay what types of business models could I do and which ones make sense some of them

can be done in parallel you know you can't you can you can license to two different actors in fields of use but

not the same field of use um sometimes you might slice off something to help you get going that's not part of your

main business as in oxion and then and then move into more of a product sales um thinking all these

types of things become more easy to to talk about once you understand what is it that you have as as technology assets

and also understand what is the competitive environment that you're entering into

so so when would be the right time to think about it as early as possible I think that um well most people have an

intuition of a business model I think when they get going but I think the best thing to do is to really understand the

nature of what what technology they have and what models are possible so you want you want to decide not to license

because you thought about it not because you didn't know about it so I would say this the sooner the better um so that

you have it as part of a plan you also mentioned that it is important to get uh the IP advice and

expertise um would you maybe be able to tell our audience where to look for the IP expertise so let's say imagine I'm a

young company or I'm starting a young company after this uh training I will know that IP is very important but maybe

I'm not an IP expert so I don't really know exactly what to do still so where can I go to get IP advice should I get a

lawyer should I go to patent attorney should I find a specialized consultant so where to

go I think this is one of the issues that I've um spoken a lot about I'm sure you've heard me Adela talk about this um

I believe that you know especially small small firms they they need this type of meta consultant because they have a lot

of issues right you know they probably heard that they should get a patent um so maybe they would go to a patent

attorney but maybe they have software that they would like to um or participate in open source in some way

or maybe they would like to keep things is better to keep things secret so what you would want is someone that could

help you to understand what types of intellectual or intangible assets you have and how that relates to your

business what business models are possible and then based on that what type of IP strategy you need I always

say that the IP strategy is more important than the IP rights especially in the beginning um sometimes it's hard

to find that one person that can do all those things but um so you might have to bring in different people you should try

to find someone is more holistic as possible but definitely if you're doing licensing you need a lawyer to help you

out and I should have a caveat that I'm I'm not a lawyer so I'm giving advice as a business person

today okay very good um another thing that comes to my mind is um so when we when you imagine that

you are just considering entering into a licensing relationship with a potential lensy what would be the main

considerations for the beginning what do you have to think about before actually closing a licensing agreement or

choosing a potential lensy yeah well of course fir first and foremost you want to try to choose some

someone who's likely to be able to achieve the goals that you have in mind you talked about the

shelving issue you know when you when you when you license to someone you're not going to make any money unless they

make money right your idea is not going to get out in the world unless they take it further so you want to find someone

who's who you think is going to be dedicated to to doing that and then of course you want to give that person all

the information they need but but no more than what they need because maybe you can use um um you can use their

intellectual assets and other purposes for other actors and also you don't necessarily want to give too much to the

other side um because you have to be careful they have to be they have to be a trusted actor because once you give

them things that are say Secrets now they're responsible for your secrets which is always tricky right so I think

I think this trust that um they will hand your assets properly and that they will you know

work hard to commercialize in this collaboration is critical that actually brings me to the

topic of uh the object of the license so what you should be actually licensing out uh so I touched upon it also a

little bit in the case study of oncure I said that they combine the pattern with the Trade Secrets they include also some

support for manufacturing so uh the first question would be actually um just that our audience can can imagine that a

little bit better uh what does it mean to combine patents with Trade Secrets how can we imagine that because one can

say when you file for a patent uh on your technology you should disclose your technology sufficiently so that it can

be reproducible so how can you actually combine it with Trade Secrets could you maybe give us an example of

that yeah so typically um often times in licensing we think about two types of licenses one's a technology license and

one's a patent license if it's a patent license typically the person um that you're licensing to already knows the

technology they just need to have a permit to be able to use it or for you not to block them so then the license

the license object would mostly be the patent that covers the technology that would be the main

discussion but if it's a technology license in other words the other the person you're licensing to needs

knowledge and knowhow from your group to help them Implement your technology then that could be things

that aren't patented it could be things that are kept as Trade Secrets and well you probably would

argue that everything that's not in the patent that's valuable you're trying to keep secret now whether you manage them

as a trade secret that's another legal issue to to think about but now you're actually transferring more knowledge

than what's in the patent to an actor that probably needs this knowledge to understand how to proceed this could

even include having people from your staff participating in teaching and working with the license e um for for

many months or year or years okay so it's clear that one of the advantages of this approach is that you

are basically giving your lensey even more support uh and increasing the chances that uh he will be successful in

reaching the goals can you think of other advantages that it might have to to combine patents and Trade

Secrets would it be for example yeah go ahead I was going to say yeah one other issue could be that um when you have

relationships connected to trade secrets or knowhow this this can extend longer than the period of a patent um and also

if the patent for some reason is invalidated um then you still have other objects in the agreement that allow the

agreement to continue so it can create more security around the control position that you have for your

intellectual assets that you're licensing than just the patent which could be V vulnerable and as you know

expires over time that's exactly what I had in mind actually so when you when you imagine

this scenario that we have a licensing agreement in place the patents have expired but the license still continues

for the trade secrets from your experience uh do you think that the license would typically continue with

the same or under the same conditions or would the licenser maybe have to settle for lower lower lower royalties or you

know would the would the terms then change in the licensing agreement yeah it would likely have to

change because now the the um strength of the objects that were transferred is is lower than it was before you know the

if you just transfer Secrets or knoow um the people that you transfer to are going to put an investment into that

and their investment is not being controlled as well as it would be if there was also a patent so there's more

risk involved which means that you're going to have to share that risk probably um in a different way than you

had originally in the agreement and what can go wrong in this case so when when we imagine such a

situation and let's let's imagine that the lensey discloses my trade secrets so what can I do in such a situation how

can I protect myself or defend myself yeah so this is really a legal question but just from a business perspective

um when you trust people with Trade Secrets you you um you really are becoming vulnerable in

that way right so uh by letting them have the secrets you are now no longer in charge of something that once it gets

out into the world it's out into the world right so it's possible that if you give somebody information secret and it

gets out into the world that there's really even though you might have some type of agreement about what happens in

that case it might be that there's no type of compensation that will put the cat back in the bag so to speak right

there's no way to bad to talk about putting cats in the bag I don't know why we would do that

but but um you know there's um you know sometimes when Secrets get out they can destroy the whole business and while

there could be certain legal Clauses about how to handle that um that's not what you wanted to accomplish so now you

you've extended your secrets to a group of other people and secrets by their very nature are difficult to

contain and if I disclose my trade secrets to my lensey and then the lensey discloses them to to General Public can

I pr can I prevent the the general public from using those Trade Secrets because they were my Trade

Secrets um yeah this is this would probably be the better question for uh for your for the lawyers that are coming

up because it'll probably depend a bit on jurisdictions and I know they've changed the trade secret laws recently

in many places once something is out it's hard to prevent people from using it and

definitely the thing that it'll definitely be used as PRI prior art in relation to other things going

forward um depending on how the negligence of an actor relates to others being able to use it I think I'm going

to ask you to to to talk to the lawyers about that because it might be different in different

jurisdictions excuse me jurisdictions okay thanks a lot so you're always trying to get me to be a

lawy you're trying to get me to be a lawyer aren't you I wanted to say let's go back to the business questions

again maybe one last question um we were also touching upon uh exclusive and non-exclusive Licensing in this uh in

this session so how do you decide uh whether you grant an exclusive or non-exclusive license and maybe you can

approach this question a little bit from a broader perspective because you also talked about licensing brands software

so um how do you make the decision whether exclusive or non-exclusive yeah so um that's a good

question often times it depends on what the ly requires in order to be able to effectively succeed in their

task so when it comes to biotech for example it might not be very easy um to offer a general non-exclusive license

because that won't give enough exclusivity to to defend the investment that they'll need to make excuse me to

take it forward so you you might have to make it exclusive in order to give people enough

control to put in the investment that's required um non-exclusive would be something where maybe you give it to

everyone in the whole industry that moves everyone up to a similar level um where maybe a not a lot of investment is

required by any one actor and no one is looking to have exclusivity themselves in the market um certainly non-exclusive

licenses are what's used when it comes to copyright because everybody can have it at the same time right

um one thing to think about instead of non-exclusive because that seems very broad is to think about a portfolio of

exclusive licenses so exclusive for this use exclusive for this geography so it's something in between a purely Allin

exclusive license and a non-exclusive it's exclusive for specific areas that's probably a better way to think about

licensing when it comes to technology and patents that's what we have actually

seen in the case of enure right right exactly okay uh I'm looking at the clock I think that our time is up

so thanks a lot for this um I think this was a very insightful session I'm sure that our audience will learn a lot from

your experience so thank you very much for your time thanks and thanks to De it's always nice to see you and thanks

for bearing with me with my my throat today sorry about that no problem no problem Bo and uh Tom I'm giving the

word back to you e and I'd like to have a question answer

session on on on the video as I mentioned Bowman wasn't able to join us today but my colleague Thomas Brier from

the EPO who also was actually part of the team who who worked on that initial um uh paper is joining me me and also

Adella is on stage as well so without further Ado i' like to ask some questions um Adella the first one few

came in from the audience um so enco QR back licensing is agreed in non-competing fields

and can you elaborate on this a bit a bit more please how is the potential competition

evaluated yeah that's a good question well basically the the non-competing nature is actually uh by default because

as I explained in the presentation each of the lenses has in the license specified a very narrow um field in

which they can use the technology and also the back license actually is only for this this this narrow field bu so

already when the licenses are are are agreed upon it is made sure that uh that each of the licenses will have its own

narrow field that those field of course fields of course will not overlap so each of the licenses is actually

developing a product for a specific disease and that's always a different disease and uh yeah so also as a

consequence the back licenses are automatically actually granted for non-competing Fields does it make

sense yes super thank you very much and I have a question for Thomas has coming so could you expand on the