Chapter 5: Government Funded Biotechnology Research
5.2 United States Government Funded Public Research Institute: National Institutes of
5.3.4 Overview of Licensing Process at NHRI
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higher royalty rate to its licensor to make up its lost due to lower royalty rate charged earlier142.
Royalty revenue derived from licensing is divided among inventor, research institute and NHRI. According to Paragraph 17 of MOHW Intellectual Property Management Guideline143, 60% of the revenue derived from government-funded research outcome should be channeled back to Taiwan National Science Technology Development Fund144 to further subsidize future research grants. 40% of the balance revenue would be distributed to inventor (40%), inventor’s institute (20%) and NHRI (40%)145.
5.3.4 Overview of Licensing Process at NHRI
Figure 12 NHRI Technology Licensing Process
142 中華民國 101 年度行政院衛生署預算總說明（2012），衛生福利部，Retrieved from http://www.mohw.gov.tw/MOHW_Upload/doc/衛生署 101 年度單位決算(審定本).pdf
143 行政院衛生署及所屬機關科學技術研究發展成果歸屬及運用辦法
144 國家科學技術發展基金
145 北京清華大學學者蒞院參訪（n.d.），國家衛生研究院電子報第 398 期，國家衛生研究院，Retrieved
from
http://enews.nhri.org.tw/enews_list_new2_more.php?volume_indx=398&showx=showarticle&article_indx=844 0
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Figure 12 highlights the process of technology licensing at NHRI. The technology licensing process starts once an inventor approaches NHRI upon inventor’s supervisor approval. According to the flowchart provided on NHRI TTO website, there are two ways for a technology to be licensed: 1) TTO seeks for potential licensing target; and 2) TTO announces the technology on its website, corporates that have interest in the published technology approach TTO. Of these two ways, potential licensees have to submit a Technology Transfer Application to TTO.
NHRI publishes a “Technology Licensing Notice” for every available technology to license on the “What’s New” section of the website. Every notice comes with a submission deadline that ranges in between 5-14 days. Varies from notice to notice, generally a notice consists of i) Subject indicating technology to be licensed; ii) A one sentence description of the invention; iii) Exclusive or non-exclusive licensing;
iv) Qualification to be met by applicant146; v) Instruction for application, including TTO personnel responsible for the technology; and vi) Technology Transfer Application form. NHRI Technology Transfer Application form requires potential licensee to disclose the following information:
1. Basic information about the company
Including employee numbers, R&D personnel numbers, company profile, work which is related to the to-be-licensed technology, prove to have a clean track legal record, or any collaboration opportunity with NHRI in the past
2. Core products and Annual sales revenue (Require to attach said Product Catalogue and said Product Operating Guide)
3. Company Organization Structure
4. Major Events of Research and Development, Production, and Sales Record 5. Affiliate Company’s Product which could help with the Evaluation
146 Usually these four qualifications: 1) Applicant is registered with the government and has no illegal record; 2) Preferred to be equipped with experience in developing related technology; 3) Preferred to be equipped with international collaboration and clinical research experience; and 4) Willing and devoted to long-term investment of research and development
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After reviewing the application, TTO will select applicants, of which are eligible for licensing to attend the said technology explanatory meeting. Interested applicant has to submit a “Current and Future Plan” for the technology. Future Plan should include: Name of the Technology Licensing, Expected Application of said invention, Invention Licensing Timeline, Follow-up Development and Investment of the said invention.
According to the requirement standard set forth on the Licensing Announcement, NHRI IP Management Committee evaluates applicants based on the following criteria:
Investment Time & Manpower (20%) Dedicated Research Funding (25%) Related R&D Experience (25%) Product Development Planning (30%)
Total (100%)
For exclusive license application, the application will be reviewed by NHRI
“Intellectual Property Management Committee”, while non-exclusive license will be reviewed by the TTO. Shall the application failed, the licensing application will not proceed. If not, TTO will negotiate the licensing term with licensee upon the approval from the Director of NHRI. The final contract needs to be approved by the Director of NHRI before execution. Exclusive license contract needs to be approved by MOHW while non-exclusive license will take effect upon the signature of both parties.
5.3.4.1 Reputation and Licensing Performance
Since the establishment of NHRI till year 2012, NHRI has licensed 22 of its technologies to business corporates, among them, 14 had been terminated, and 8 licensing cases are still under execution. Reason for termination includes the inability of licensee to execute the licensed technology effectively or on-time, licensor decided to terminate the research project due, failure to explore possible drug candidates and etc.
Some of the NHRI technologies were licensed to companies that produce dietary
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supplements147, which is not satisfying according to the surveillance committee of Taiwanese government (The Control Yuan of Republic of China), as it would generate greater revenue shall there be a candidate to be licensed for new drug.
In 2013, NHRI obtained 19 patents in total, including 6 U.S. Patents, 1 Australia Patent, and 12 Taiwan Patents148, 149, 150. As mentioned above, NHRI is rather young, considering it is only 17 year since its establishment (1/5 of the length of NIH foundation) and TTO is only established for less than 12 years, the NHRI performance on intellectual property management and licensing is rather immature. Table 12 shows patents obtained by the NHRI since its foundation, only two patents were awarded before year 2004, of which were obtained in 1999 (U.S. Patent) and 2001 (Taiwan Patent)151. All patents awarded to NHRI are still valid to date (Dec. 8, 2013), of which earliest to expired is in 2016152. NHRI did not disclose any statistics on “Disclosed Invention” on its official website.
147 李炳南、馬秀如、錢林慧君、尹祚芊（2012），國衛院執行績效案調查報告，中華民國監察院，
Retrieved from http://www.cy.gov.tw/AP_HOME/Op_Upload/eDoc/調查報告/102/102000113 國衛院執行績 效案調查報告-上網版.pdf
148 Latest Patents (n.d.), 國家衛生研究院， Retrieved from
http://www.nhri.org.tw/NHRI_WEB/nhriw001Action.do?status=Show_Dtl&nid=20090211561938370000&uid
=20090211561938370000
149 The statistics of patents obtained in 2013 by NHRI was retrieved from NHRI TTO websites (See footnote above). However, please note that the newest patent was dated on May 21, 2013. The last retrieval date was at December 8, 2013, 17:48 (GMT+8); Any further updates on the website does not count into the statistics.
150 On Jan 13, 2014, the author noticed an update of 11 Taiwan patents, 8 U.S. patents and 3 other countries’
patents to the “Latest Patents” website. Adding a total of 22 new patents applied in 2013 to 41 patents. (Last update: Jan 13, 2014, 07:07 [GMT+8])
151 Issued Patent Before 2012 (n.d.), National Health Research Institutes, Retrieved from http://www.nhri.org.tw/NHRI_ADM/userfiles/file/Issued_patent_before_2013.pdf
152 No Title (n.d.), National Health Research Institutes, Retrieved from
http://www.nhri.org.tw/NHRI_ADM/userfiles/file/NHRI_Issued_Patents_2.pdf
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Table 12 Patents Obtained by NHRI from 2004-2013Error! Bookmark not defined., *: See Footnote 149 and 150.
Year of Taiwan Patent U.S. Patent Other Intl’
Patent Total Patents Obtained
2004 1 3 1 5
2005 1 2 0 3
2006 3 4 1 8
2007 6 2 1 9
2008 9 7 2 18
2009 7 8 5 20
2010 6 9 3 18
2011 10 12 3 25
2012 11 18 4 33
2013 12 6 1 19*
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Table 13 Research Funding from MOHW to NHRI and NHRI’s Licensing Performance from 2008-2013142, 153,154, 155,
156, 157, 158, 159
元」，衛生署100 年度法定預算，p34。The Chinese text mentioned on the previous sentence indicates NHRI Upfront Licensing Fee was NTD$ 372M, Licensing Fee was NTD$ 68.7M, while the Royalty Fee was NTD$ 1.9M in 2010. Since NIH Upfront Licensing Fee, Licensing Fee and Running Royalty Fee as “Royalty”
as general, this study adds up all the above-mentioned income (372+68.7+1.9=442.6) and regards NTD$
442.6M as royalty received by NHRI in 2010.
154衛生署97 年度法定預算（2013），衛生福利部，Retrieved from
http://www.mohw.gov.tw/cht/DOA/DisplayFile.aspx?url=http://www.mohw.gov.tw/MOHW_Upload/doc/衛生 署97 年度法定預算_0029173001.zip&name=衛生署 97 年度法定預算_0029173001.zip
155衛生署98 年度法定預算（2013），衛生福利部，Retrieved from
http://www.mohw.gov.tw/cht/DOA/DisplayFile.aspx?url=http://www.mohw.gov.tw/MOHW_Upload/doc/衛生 署98 年度法定預算_0029172001.zip&name=衛生署 98 年度法定預算_0029172001.zip
156衛生署99 年度法定預算（2013），衛生福利部，Retrieved from
http://www.mohw.gov.tw/cht/DOA/DisplayFile.aspx?url=http://www.mohw.gov.tw/MOHW_Upload/doc/衛生 署99 年度法定預算_0029171001.zip&name=衛生署 99 年度法定預算_0029171001.zip
157 衛生署 100 年度法定預算（2013），衛生福利部，Retrieved from