Licensing Government Intellectual Property to Accelerate Your Business: A Note from Our Chief Scientist

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Licensing Government Intellectual Property to Accelerate Your Business: A Note from Our Chief Scientist

By Dr. Elan Moritz, ETC

Did you know that the U.S. Government is eager to license federally developed technology and intellectual property?  Did you know it does so at bargain rates?   Does that even make sense?

If you are working in an area that could use the fruits of government research and development, and wish to get a jump on the competition without investing many years and many dollars conducting private research, you might be able get a very serious boost and acceleration from licensing government developed technologies and intellectual property.

Many government agencies have Research and Development (R&D) centers and laboratories that, as part of their normal and highly encouraged duties, obtain patent protection.  These organizations literally spend billions of dollars every year in R&D.  A good fraction of the investment in that intellectual property is available for licensing at very reasonable licensing rates.

The government agencies that are the prolific inventors are the Department of Defense (DOD), the Department of Commerce (DOC), and in particular its National Institute of Standards and Technology (NIST),  the  Department of Health and Human Services (HHS), with primary research done by National Institutes of Health [NIH] researchers,  National Air and Space Administration (NASA), the Department of Energy (DOE) whose National Laboratories are home to many world class scientists and engineers, the Department of Agriculture (USDA) and the Veterans Administration (VA).

DOD garners over 400 new US patents a year.  A good number of these patents are developed at research centers in (or within) close proximity to southern Maryland, in places like Naval Surface Warfare Center, Indian Head Division and Dahlgren Division, the Naval Research Laboratory in Washington, D.C., and the Naval Air Warfare Center Aircraft Division at Naval Air Station Patuxent River.

Besides DOD, DOE and HHS also garner over 400 new patents a year.  DOD licenses approximately 4% of a portfolio of 10,000 active patents. (On the average 60 new inventions are licensed ever year.) In comparison, DOE licenses approximately 30% of a portfolio of 20,000 patents (of which many are new patent licenses).

Depending on arrangements, licenses may be non-exclusive. Non-exclusivity allows an agency to license to several licensees – similar to giving multiple franchises to different individuals to operate in different locations.

What is really fascinating is the VERY LOW COST OF GOVERNMENT LICENSES. Looking at FY 2009 (a year for which licensing data is available for most patent obtaining government agencies), HHS obtained on the average $53,000 per license, while DOE obtained $7,560 per license, NASA obtained $960 per license, and DOD obtained $38,000 per license.

If one compares these licensing fees to ones charged by universities and by industry, one would quickly find that universities and industry charge licensees hundreds of thousands of dollars to almost a billion dollars per license.  The overall message is clear – obtaining a license to use government intellectual property is a bargain!

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