New Ways of RD Collaboration Open Innovation Collaborative

New Ways of R&D Collaboration: Open Innovation, Collaborative Licensing and How to Prevent and Resolve Disputes Wim Vanhaverbeke University of Hasselt, Vlerick Leuven Gent Management School, ESADE Business School (Barcelona), Founder of Exnovate Esther van Zimmeren Research Fellow FWO University of Leuven esther. vanzimmeren@law. kuleuven. be wim. vanhaverbeke@uhasselt. be Workshop on ADR in R&D Collaborations, November 13 2009,

Thesis Organizations involved in Open Innovation (OI) have an even bigger incentive to use ADR in order to prevent and resolve disputes Workshop on ADR in R&D Collaborations, November 13 2009, Leuven

Plan 1. Open Innovation (OI) 1. 2. 3. 4. Introduction Closed Innovation OI Crucial dimensions in OI 2. Basic IP Issues Conflicts – Recent Example 3. OI & R&D Collaborations & ADR 1. Multiple Parties 2. IP Models 3. Collaborative Licensing Models & ADR 1. Patent Pools & ADR 2. Clearinghouses & ADR 4. Conclusions Workshop on ADR in R&D Collaborations, November 13 2009, Leuven

Introduction What is Open Innovation? “Open innovation is the use of purposive inflows and outflows of knowledge to accelerate internal innovation, and expand the markets for external use of innovation, respectively. ” Chesbrough, Vanhaverbeke, West Open Innovation: Researching a New Paradigm (2006) Workshop on ADR in R&D Collaborations, November 13 2009, Leuven

A Closed Innovation System Science & Technology Base Research Investigations R The Market Development D Workshop on ADR in R&D Collaborations, November 13 2009, Leuven New Products or Services Source: Henry Chesbrough

CI: The Virtuous Circle for R&D Fundamental Technology Breakthroughs Increased investment in R&D New Products and Features Increased Sales and Profits via existing business model Workshop on ADR in R&D Collaborations, November 13 2009, Leuven Source: Henry Chesbrough

OI: The Virtuous Circle Broken Fundamental Technology Breakthroughs The outside option IPO Increased or investment acquisition in R&D RIP New Products Key engineers and Features exit to form new company Increased Sales and Profits Venture Capital helps team to focus on new market, new business model Workshop on ADR in R&D Collaborations, November 13 2009, Leuven Source: H. Chesbrough

Inbound OI: Filling gaps with external technology New Market Internal Technology Base Current Market External Technology Base External research projects Technology in-licensing Technology acquisition Venture investing R Source: H. Chesbrough Workshop on ADR in R&D Collaborations, November 13 2009, Leuven D

Outbound OI: Profiting from others’ use of your technology Licensing Other Firm’s Market Technology Spin-offs New Market Internal Technology Base Current Market External Technology Base R Source: H. Chesbrough Technology Insourcing Workshop on ADR in R&D Collaborations, November 13 2009, Leuven D

Open Innovation: Crucial dimensions in open innovation strategies • • • Strong/weak IP regime Complexity and cost of technologies Relevance of emerging technologies Products or integrated solutions Core technologies or not Precompetitive or application driven – non-exclusive or exclusive rights • Vertical vs. horizontal cooperative deals – Specialization of labor (technology markets) and FTO/I Workshop on ADR in R&D Collaborations, November 13 2009, Leuven

Basic IP Issues 1. Commercial objectives – link with IP 2. Fee for service contracting model vs. full-scale collaboration 3. Do not postpone legal issues vs. overly complicated contract 4. Strong, long-term relationship with the collaborators (non-disclosure agreements) 5. IP ownership – Employees 6. Background/foreground IP a) b) conditions access partners conditions access third parties i. ii. Open source Workshop on ADR in R&D Collaborative licensing models Collaborations, November 13 2009, Leuven

Conflicts – Recent Example Board of Trustees of the Leland Stanford Junior University v. Roche Molecular Systems, Inc. (Fed. Cir. 2009) co-development in the late 1980's and early 1990's of the application of PCR technology to HIV detection by Stanford and Cetus (private company that developed and owned the PCR technology) Agreements "Copyright and Patent Assignment (CPA)" agreement Holodniy Stanford "Visitor's Confidentiality Agreement (VCA)" Holodniy - Cetus "Materials Transfer Agreements“ Stanford - Cetus Workshop on ADR in R&D Collaborations, November 13 2009, Leuven

Conflicts – Recent Example Board of Trustees of the Leland Stanford Junior University v. Roche Molecular Systems, Inc. (Fed. Cir. 2009) • • • 3 US patents held by Stanford Roche successor in title Cetus Licensing negotiations fail Stanford sues Roche CAFC: Stanford had no standing Legitimate assignment of rights to Cetus/Roche Workshop on ADR in R&D Collaborations, November 13 2009, Leuven

OI & R&D Collaborations & ADR Open Innovation – R&D Collaborations - Value Creation Long-term Relationships Complexity New technologies Expertise – Complimentarity Funding/revenue Knowledge Transfer Bringing Product to the Market … Workshop on ADR in R&D Collaborations, November 13 2009, Leuven

Multiple Parties Contracting Parties & Third Parties Workshop on ADR in R&D Collaborations, November 13 2009, Leuven

IP Models Bilateral Licenses Cross-licenses Open Source Collaborative IP models Patent Pools Clearinghouses Workshop on ADR in R&D Collaborations, November 13 2009, Leuven

Collaborative IP Models & ADR Patent Pool Clearinghouse Workshop on ADR in R&D Collaborations, November 13 2009, Leuven

Patent Pools & ADR Conflict Conflict Litigation? European Commission Technology Transfer Guidelines - ADR Workshop on ADR in R&D Collaborations, November 13 2009, Leuven Arbitration Mediation Expert determination

Clearinghouses & ADR Litigation? Mediation Expert determination Workshop on ADR in R&D Collaborations, November 13 2009, Leuven

Conclusions Organizations involved in Open Innovation (OI) have an even bigger incentive to use ADR in order to prevent and resolve disputes - ADR integrated in Collaborative Open relationships IP models? Long-term relationships Patent Pools Expertise Clearinghouses Negotiated solutions Quick solutions Transaction costs – Litigation costs Role of precedents Workshop on ADR in R&D Collaborations, November 13 2009, Leuven

2008 2006 Open Innovation for Policy makers Vision-Eranet 2006 2003 Workshop on ADR in R&D Collaborations, November 13 2009, Leuven 2010 Implementing and organizing open innovation

Exnovate as a network of excellence for OI -practitioners and scholars? • www. exnovate. org = An international network of excellence on Open and Collaborative Innovation based on connecting people, creating transparency and leveling up quality of services • Connects companies – academia (30 top scholars networked) – governments – service providers • Membership organization • Projects – CE and OI Masterclass (6 times already) http: //masterclassfall 2009. cisevents. hightechcampus. nl/ – European Innovation Forum – Calls for proposalsr OI-management solutions • Free information : cases, syllabi & updated bibliography about open innovation, Ph. D projects, etc… 24 wim. vanhaverbeke@uhasselt. be