POLICY ON INVENTIONS, PATENTS AND INTELLECTUAL PROPERTY. Summa Health System Akron, Ohio
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1 POLICY ON INVENTIONS, PATENTS AND INTELLECTUAL PROPERTY Summa Health System Akron, Ohio Office of Research Administration Medical Education & Research Summa Health System Akron, Ohio Approved by Summa Health System Board of Directors September 24, 2009
2 SUMMA HEALTH SYSTEM POLICY ON INVENTIONS, PATENTS AND INTELLECTUAL PROPERTY For the purposes of this Policy, the following definitions shall apply: Institution: Summa Health System (SHS) having its place of business at 525 East Market Street, Akron, Ohio, and subsidiaries thereof at least 50% of which are owned by Summa Health System. Summa Creators: Summa Creators include Physicians employed by Summa Physicians, Inc; (SPI) Employees, staff, students, trainees, and volunteers of SHS and its subsidiaries at least 50% of which are owned by Summa Health System; physicians with privileges at SHS-entity hospitals and others who utilize SHS facilities or SHS resources who has (have), in the context of the scope of their work as SPI or SHS employees, or, in the context of their Summa-affiliated work (non-spi, non-shs employed Creators), made an inventive contribution to an invention and who is (are) identified as such on the licensed patent, patent application or unpatented technology or has (have) created a discovery, development or other intellectual property which is not susceptible to patent protection. In the case of a patent or patent application, this contribution must be applicable to at least one claim. In cases of joint creatorship, it is not necessary that each Creator make the same type or amount of contribution to the invention and it is not necessary that each Creator make some contribution to each claim. Cumulative Net Lifetime Proceeds: Gross revenues or other payments received by SHS from a licensed technology minus applicable patent filing fees, other legal fees associated with the technology, fees for patentability and marketability searches, fees arising out of litigation, legal advice or any other fees or costs directly attributable to the invention being licensed. Indirect costs, overhead or other SHS costs usually associated with operation of SHS and not directly attributable to the invention shall not be deducted from gross revenues. I. Preamble As a leading institution for patient care and research, Summa Health System (SHS) dedicates its efforts towards the discovery of knowledge that will benefit patient care now and in the future. Recognizing that discoveries, developments, inventions and other intellectual property of commercial importance are a natural outgrowth of research and patient care without intent to focus the pursuit of research solely on the attainment of patents, SHS has the responsibility to: A. encourage creativity and innovation, B. promote the use of novel discoveries and inventions for the good of the public, and C. provide equitable distribution between SHS and the Summa Creator(s) of licensing revenues resulting from the commercialization of novel discoveries and inventions. To further these objectives, and inasmuch as the Board of Directors of SHS desires to encourage the development of inventions made by Summa Creators, when these inventions are deemed to be of sufficient importance, both for the public interest and as a means of developing a new source of intramural research funds, the following Policy on Inventions, Patents and Intellectual Property Page 2 of 7
3 has been formulated and adopted. The Board of Directors recognizes that commercial development is generally encouraged when intellectual property protection is available. This Policy was approved and adopted by the Board of Directors of SHS on September 24, II. Covered Research/Innovation The research/innovation covered by this Policy (hereinafter Covered Research/Innovation ) shall include (i) all research/innovation activities conducted in the course of a potential Summa Creator s employment with SHS (including but not limited to the performance of a research grant, contract or award made internally or by an extramural agency) and (ii) any research/innovation conducted wholly or partially with the use of SHS and/or Summa Foundation (SF) resources, including, but not limited to, use of funds obtained by or through SHS, SHS facilities, laboratories or other resources available because of Summa Creator s status or relationship with SHS or otherwise through SHS (regardless of whether the investigator has a relationship with SHS). III. Policy All rights to and interests in all discoveries, developments, inventions or other intellectual property resulting wholly or partially from Covered Research/Innovation shall be the sole and exclusive property of SHS, and no other person or entity shall have any rights of ownership or interest in such discoveries, developments, inventions or intellectual property (hereinafter Covered IP ). To the extent any statutory or other rights exist in intellectual property subject to this Policy at time of creation they are automatically transferred to SHS. Any and all exceptions to this Policy shall be determined and approved by the SHS Board of Directors, upon the recommendation of the _Technology & Innovation_ Committee of the SHS Board of Directors. IV. Invention Disclosures All Covered IP shall be promptly disclosed in writing to the Office of Research Administration of SHS. The standard disclosure form provided by SHS (Summa Invention Disclosure Form) should be used for this reporting process and may be obtained from the SHS Office of Research Administration. V. Rights and Obligations of the Parties All rights to and interests in development, discoveries, inventions or intellectual property arising in the course of research investigations or creative activities sponsored by SHS, any government or private agency or other sponsored research are controlled by the terms of the applicable research agreement, which must be reviewed, negotiated and approved by the Office of Research Administration prior to execution. In the absence of provisions to the contrary contained in any such research agreement, the following shall apply: A. Summa Creator rights. Summa Creators have the right to: 1. receive notice within a reasonable time of SHS s intention to file a patent application or otherwise to retain title to the Covered IP after disclosure to SHS of such; 2. receive a share of any licensing fees or royalties received by SHS from the commercialization of the Covered IP according to the distribution schedule contained in Section VII of this Policy; 3. receive from SHS title to any Covered IP in the event SHS elects not to retain title; and Page 3 of 7
4 4. timely publication of his/her research findings. B. Summa Creator Obligations. The Summa Creator is obligated to: 1. report promptly to the Office of Research Administration by the preparation of a Disclosure, a summary of the concepts, relevant data, observations and general claims with respect to any Covered IP, as well as the name(s) of any collaborator(s); 2. assign title to SHS; 3. cooperate to the extent necessary as determined by SHS in: a. reasonably delaying of publication to allow for submission of a patent application or other intellectual property protection; b. prosecuting all patent applications or other intellectual property protection and other required documents; c. participating in the support of such patents or other intellectual property protection during prosecution for interference or infringement; d. assisting with licensing or marketing efforts related to the Covered IP. C. SHS rights. SHS has the right to: 1. assign to the Summa Creator title to any Covered IP for which SHS chooses not to retain title; and 2. make, use, license, assign or sell to a third party the rights and interests of any Covered IP and exclude others from doing so. D. SHS Obligations. SHS is obligated to: 1. make available to Summa Creators this SHS Policy; 2. after a Disclosure, timely act to determine whether SHS chooses to retain title, to submit to an external source for evaluation, and/or determine whether a patent application or other intellectual property protection is to be filed concerning the Covered IP; 3. give notice to a Summa Creator, within a reasonable time after a Disclosure, of SHS s decision to file a patent application or other intellectual property protection or otherwise retain title to the discovery, invention, development or other intellectual property; 4. expedite intellectual property protection so as to minimize the delay of publication; and 5. distribute to the Summa Creator(s) licensing fees or royalties received by SHS for any discovery, invention or development according to the schedule contained in Section VII of this Policy. Page 4 of 7
5 VI. Licensing It is the policy of SHS to encourage the development, marketing and commercialization of inventions resulting from research/creative activities so as to achieve a public usefulness and benefit. It is recognized that such a policy may require various forms of agreements including the granting of exclusive licenses. SHS may, in appropriate circumstances with due consideration to the prospective licensee and when consistent with law applicable to federally supported research/creative activities, license Covered IP on an exclusive or nonexclusive basis for a reasonable period up to the full term of the patent, provided that such license shall contain provisions to promote the likelihood that the invention provides a public benefit, such as a requirement of due diligence and march-in rights, for Covered IP resulting from federal funding, when the licensee does not adequately perform. SHS also may elect to license unpatented technology on an exclusive or nonexclusive basis. VII. Distribution of Proceeds A. For all discoveries, inventions, developments or other intellectual property for which SHS receives proceeds from licensing to external third parties (not patients or end user customers), SHS shall deduct all expenses incurred pertinent to the technology and not recovered previously. The remaining net proceeds received by SHS shall be distributed 50% to the Institution and 50% to the Creators should all Creators remain in the relationship with SHS under which the intellectual property in question was created. Non-cash consideration received shall not be distributed until liquidated into cash. All cash received in payment for a license or for liquidation of non-cash consideration will be distributed in the calendar year received. B. Net proceeds received by SHS must be used to support research, to advance payments of fees or costs attributable directly to the invention as described in the definition of Cumulative Net Lifetime Proceeds, or to support the Technology Transfer function or as otherwise directed by the Technology & Innovation Committee of the SHS Board of Directors. C. In the case of joint creatorship, each Summa Creator s share shall be equal unless otherwise agreed to by each Summa Creator. D. With the exceptions of retirement, permanent disability and death, any Summa Creator leaving the relationship with SHS under which the intellectual property in question was created, shall receive 60% of any subsequent amount such Summa Creator would have received had he/she remained in the relationship under which the intellectual property in question was created of Cumulative Net Lifetime Proceeds for the term of the license agreement in which the intellectual property in question is the licensed technology. E. The distribution schedule shall apply equally to revenues received from licensing and commercialization of unpatented technologies. The distribution schedule may be adjusted if the Summa Creator(s) participate in the payment of costs associated with patenting and/or licensing. VIII. Research Agreements Involving Patent Rights It is common for Summa investigators to receive awards from private industry to conduct research. Likewise, it is common for investigators to conduct research in collaboration with investigators at universities and other research institutions. SHS acknowledges that to continue these collaborative relationships it must be prepared to consider a variety of contractual terms and conditions. To protect traditional academic freedom within SHS, to assist investigators in Page 5 of 7
6 evaluating proposals and agreements and to protect the interest of SHS in discoveries, inventions and other intellectual property, the following policies shall apply to these relationships: A. All Materials Transfer Agreements, Confidential Disclosure Agreements, Sponsored Research Agreements, Laboratory Services Agreements, License Agreements and other documents which propose agreements with private industry or with other research institutions or universities and in which either (a) existing SHS intellectual property is being utilized or (b) the potential exists for the generation of new intellectual property, must be reviewed, negotiated and approved by the Office of Research Administration. This is to ensure that any intellectual property rights which SHS may have and choose to retain are appropriately protected; B. SHS will not waive the right of the investigator to publish results of research. SHS may agree to reasonable delays in submission of publications to allow appropriate action to be taken to protect patentable discoveries and inventions. Further, SHS will not agree to delays which effectively compromise a student s timely completion of a course or degree; C. Title to all documents, notebooks, records and other repositories of research/creative activity information shall rest with SHS. D. SHS agrees that proprietary information provided to it remains the property of the sponsoring commercial entity or other research institution. However, written agreements must clearly define what information is to be considered proprietary. IX. Administration of the Policy A. The Office of Research Administration shall have overall responsibility for the administration of SHS s patent procedures, including the protection of intellectual property rights and assets against loss. Specific responsibilities of the Office of Research Administration in this effort are to: 1. function as a contact point and resource with respect to SHS policies and procedures regarding inventions, patents and intellectual property; 2. receive reports and disclosures of all Covered IP; 3. seek patentability and marketability data on all discoveries and inventions disclosed by faculty, staff, students, trainees or volunteers; 4. recommend whether SHS should; a. retain intellectual property rights; or b. surrender all rights to the Covered IP to the Summa Creator(s). 5. further recommend, in consultation with the Summa Creator(s), whether to: a. retain title, develop and market the Covered IP; b. retain title and dedicate the Covered IP to public use; c. assign title to the Covered IP to a commercial developer and marketer; d. pursue a license of the Covered IP to private industry, with all patent and legal expenses borne by the licensee. Page 6 of 7
7 B. Additionally, the Office of Research Administration has the responsibility to: 1. protect all intellectual property of SHS through the initiation, negotiation, review and execution of: a. research agreements with industry; b. confidentiality agreements; and c. materials transfer agreements Summa creators shall assist when necessary in this function. 2. maintain records of all intellectual property agreements and communicate issues relevant to intellectual property in a timely manner to the Summa creators C. Once a patent has been pursued, disputes between SHS and the Summa Creator(s) that cannot be resolved by the System Director of Research shall be resolved by a review committee of three (3) persons appointed by the SHS Vice President of Medical Education & Research. The decision reached by this committee is final. D. In the event that the Office of Research Administration recommends that SHS not otherwise retain title to a discovery or invention, title shall be assigned to the Summa Creator(s) under an appropriate agreement. In this case, the Summa Creator(s) is (are) free to file or continue to prosecute a patent application at his/her own expense. Should royalty revenues be realized from any such assigned intellectual property, the Summa Creator(s) shall reimburse SHS and/or SF for expenses incurred up to the point of assignment. Such reimbursement may be made according to a payment schedule agreed to by the Summa Creator(s) and SHS in the assignment agreement. X. Waiver Requests Waivers of any provisions of this Policy shall be granted only in extraordinary or compelling circumstances and pursuant to the procedure described below. A request for waiver of any of the provisions of this Policy shall be submitted in writing to the System Director of Research. Such requests shall include an identification of the provision or provisions of the Policy requested to be waived and a full explanation of the reasons for the waiver including, but not limited to, the manner in which the waiver is consistent with the research and educational purposes of SHS and/or the public interest. SHS recognizes that certain sponsors may wish to impose as a condition of the award of contract or grant funds special provisions that may be at variance with this Policy. Under such circumstances, SHS will entertain such proposals as requests for waiver under this paragraph, and has the authority to accept those specific provisions. The Director of Research shall review each request for waiver and make a determination. Each action under this section shall be considered on its own merits in light of all of the facts surrounding the particular request and shall have no implication for consideration of subsequent requests. Waivers of provisions relating to the distribution of Cumulative Lifetime Proceeds shall, in addition, require the approval of the Chair of the SHS Board of Directors. A waiver of any provision of this Policy that is granted shall not be construed or interpreted as a waiver of any other provision of this Policy and all other provisions shall be maintained. Page 7 of 7
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