Topics covered include:
- Review of the various IP valuation methods for royalty calculation
- Comparing royalty payment structures:
- Percentage vs fixed fees
- Variable rate vs fixed rate
- Minimums
- Timing of payments
- Determining market value to compare rates of similar innovations
- Factors that affect royalty rates for IP, including:
- License exclusivity
- Stage of development
- Percentage of product that depends on the licensed IP
- Proven royalty rate negotiation tactics
When licensing intellectual property, the ability to structure an agreement that appropriately values the IP and balances financial risk between the licensor and licensee is critical to a successful deal. Royalty rates are among the most heavily negotiated license provisions, and determining appropriate rates involves valuation of the IP, understanding the potential market, technical and legal risks to the licensee, and a whole slew of other factors.
The reality is that not all TTOs have the resources to farm out every deal to high-price valuation and legal professionals, yet they still need to craft terms and rates that will get the deal done and appropriately reward the university, the inventors, and the licensee. Ultimately, they have to find a way to strike a deal that works, often without much outside help.
That’s why we’ve partnered with Sean Sheridan, PhD, MBA, a principal in the Life Sciences Practice at Charles River Associates, to present this detailed webinar. Dr. Sheridan has experience on both sides of the table. As a former assistant director in the University of Chicago tech transfer office, he understands the challenges TTOs face. With budgets tight, licensing associates are often left to fend for themselves with limited resources in determining an appropriate royalty rate.
Dr. Sheridan will give a clear, concise look at win-win licenses and royalty rates for your IP that close the deal while giving the university the financial returns it deserves.
This presentation will provide an overview of deal terms and structures used to balance financial risk, discuss the use of valuation in determining royalty rates, and address the importance of appropriately balancing the financial terms when negotiating a license agreement.
