mercredi, juin 23, 2010

New Zealand: Promoting and protecting intellectual property in the scientific arena

Promoting and protecting intellectual property in the scientific arena

Contributed by A J Park


The government has announced that it will implement most of the recommendations in the Crown Research Institute Taskforce Report. This should allow these institutes
(1) to focus on their core activities, provide them with greater financial certainty and stability and remove significant bureaucracy from the science funding system. However, some care will be needed to avoid the institutes being encouraged into practices that dilute the positive impacts of these changes, particularly in relation to the taskforce's recommendations on technology transfer.

Benefits

One of the taskforce's key recommendations is that the institutes should not focus on commercializing intellectual property. Instead, they should aim to move intellectual property into the private sector as soon as possible by publishing research, releasing open source material and forming partnerships with the private sector.

It is easy to agree that research results should not be locked away - public good data should be freely available and the private sector must be able to engage easily with the institutes. However, technology transfer should be managed so that the value of that technology is not lost to New Zealand. Examples of New Zealand's intellectual property benefiting overseas competitors are well known in a number of industries from forestry to aquaculture.

Relatively simple steps are needed to ensure that intellectual property transferred out of the institutes is used to the advantage of New Zealand industries.
These steps include:

  • putting in place appropriate processes around publications and seminars;
  • maintaining confidentiality; and
  • implementing formal IP protection.

Institutes should also work to retain the right to continue undertaking research in the relevant field. This will allow them to build their expertise and increase the value of the intellectual property that they generate.

Finding the right partner

The taskforce suggests that the institutes have been pushing too hard to get a good deal for their intellectual property at the expense of striking any deal at all. However, they have often struck unfavourable deals simply to show that a project has engaged with industry, given the tremendous sway that this is seen to have in obtaining further Foundation for Research, Science and Technology funding. This may have been positive for some projects; however, there are a number of examples of it being negative.

Getting intellectual property out of the institutes does not mean that it will automatically find its way into the hands of the party that best values it, and is best able to extract value from it. Unlike other tradable assets, the value of intellectual property can easily be lost or limited through poor management or underinvestment in research or protection.

Although more technology transfer to the private sector is needed, it is not in New Zealand's interest for crown-funded IP assets to be given away to the first person through the door if this means that the value of that intellectual property will be wasted.

The taskforce recommends that the institutes be subject to more thorough performance measures. These measures will need to be focused appropriately to ensure that the transfer of intellectual property out of the institutes is well considered and enhances rather than limits the value of that intellectual property for New Zealand.

Private sector involvement

The taskforce suggests that institutes have invested in spin-out companies because of a drive for profitability, and that they are not well suited to running these companies. Profitability has not been the institutes' only motivation. There is often a wide gap between technology leaving the laboratory and it becoming commercially viable. The private sector is generally hesitant to take on the high risk of failure for any technology traversing this gap. Also, inventors often need to be involved closely at this stage. As a result, institutes have been motivated and encouraged by targeted crown funding to spin out companies in order to get technology to a stage where private-sector investment can be found.

If the institutes are not appropriately skilled for this role, the government must look at other methods of bridging this gap. This may mean encouraging New Zealand's private sector to fulfil the role. Otherwise, there is a risk that institutes will focus on incremental technologies for which it is easy to find a private-sector partner, rather than step-change technology for which a partner may be hard to find, but which may be ultimately more valuable for New Zealand.

Comment

It is clear from the taskforce report that the institutes need to loosen their grip on the intellectual property they develop. However, they should not be encouraged to exert no control at all over that intellectual property. A balance must be struck if their real potential is to be harnessed to drive economic growth in New Zealand.

For further information on this topic please contact
Jonas Holland
at A J Park by telephone (+64 4 473 8278), fax (+64 4 473 8278) or email (jonas.holland@ajpark.com).

Endnotes

(1) Crown Research Institutes were established as government-owned businesses with a scientific purpose. Each institute is based around an economic sector of production or a form of natural resource.