How to comply with our intellectual property policy

If you're using a proprietary research tool provided by a company during the Wellcome-funded project, you can:

• share access to research data (before publication if necessary) that you generate using that tool, which relates to the performance of that tool
• allow that company to own any incidental improvements to the tool. These are likely to be unexpected improvements which happen by chance while using the tool and which have no impact on your publication or commercialisation of the intended outputs from the grant activities.

All other results and Wellcome-funded intellectual property generated from use of the tool should be owned by the administering organisation. They must be published or commercialised in line with Wellcome’s policies.

The proposed commercialisation partner should have the necessary expertise and adequate resources to exploit Wellcome-funded intellectual property. For example, to take a new drug through the necessary regulatory process to market.

This does not mean that the proposed partner has to have all necessary expertise and resource for all stages of commercialisation at the date of consent (or where our consent waiver applies, when the agreement is signed), but the commercialisation plan must be realistic and the partner must have a track record of taking intellectual property through to market.

For example, you might need to:

• set a deadline within which a new spin-out company has to raise additional funds or enter into a further commercialisation deal, without which the Wellcome-funded intellectual property reverts to the administering organisation 
• provide for Wellcome-funded intellectual property to revert to the administering organisation in certain circumstances, for example if the development milestones are not met

Wellcome expects a heavy focus on access to healthcare interventions to ensure the maximum public impact is achieved. Your organisation should therefore make efforts in its commercialisation agreements to maximise potential for health improvement. 

• If there is a need for the relevant intervention in the UK, you must include the UK as a priority country in your partner’s commercialisation strategy. 
• If the outputs of a grant are applicable to populations in low- and middle-income countries, you must include clauses advancing equitable access.

Additional resources to help when drafting commercialisation agreements:

• Global Healthcare Innovation Alliance Accelerator Master Alliance Provisions Guide (GHIAA MAPGuide) is a database that contains example equitable access clauses and strategies.
• Working with (or requiring your commercialisation partner to work with) patent pools (such as the Medicines Patent Pool) to license Wellcome-funded intellectual property can also be an effective way to facilitate equitable access.

You will need to negotiate specific clauses on a case-by-case basis. Examples of approaches we have previously accepted include:

• dividing up territories between a commercial and a not-for-profit partner
• requirements for products to be supplied to low- and middle-income countries or public sector purchasers at or close to cost (the cost of goods (COGs) + X% approach)
• including product registration in key low- and middle-income countries within the development milestones to ensure that the healthcare products in question are made available in those territories within an appropriate timeframe
• guaranteed supply volumes or price caps in certain territories
• priority access to products for the UK and for countries involved in the relevant research or clinical trials
• use of commercially reasonable or best efforts to keep barriers to access as low as possible while remaining sustainable for the licensee
• the ability for the organisation or Wellcome to take on commercialisation, if after exercising its reasonable efforts, a commercialising party cannot - or chooses not to - develop and make Wellcome-funded intellectual property available in a given territory within an agreed timeframe. This is particularly important if the Wellcome-funded intellectual property has been licensed exclusively. We would expect the administering organisation to reclaim the Wellcome-funded intellectual property (for example, by the exclusive licence terminating, becoming non‐exclusive or no longer applying to the territory in question) if it wasn’t being actively developed by the licensee. You must preserve the right to do this.
• the commercialising partner producing a global access plan, at a suitable stage of the technology development, which should identify barriers to access and reasonable steps to be taken by the commercialising partner to try to overcome them
• the commercialising partner agreeing to develop creative licensing strategies to prioritise affordable access, such as working with the Medicines Patent Pool or local manufacturing and distribution partners

We appreciate that access can be a challenging topic to address with licensees. However, where the technology is applicable to a healthcare need in the UK, your organisation must take steps to ensure the UK is one of the first countries to benefit. Where the technology in question could be useful in low- and middle-income countries, your organisation must ensure that patients in low- and middle-income countries are considered.

Wellcome monitors access provisions in agreements closely. Failure to address access and instead focussing solely on maximising financial return is one of the most likely reasons we will remove an organisation's consent waiver.
 

If you grant exclusive rights to Wellcome-funded intellectual property, you must place appropriate diligence obligations on the commercialisation partner to make sure:

• suitable resources are dedicated to commercialising the Wellcome-funded intellectual property
• development is not sidelined or shelved if commercial priorities change
• any significant unmet need for the technology in question is being addressed

At a minimum there should be clear definitions of terms such as ‘commercially reasonable efforts’ and you should include clear and objective developmental and/or commercial milestones.

Wellcome-funded intellectual property should be returned to the administering organisation if the commercialisation partner does not comply with diligence obligations. It may (with your agreement) be abandoned if it is no longer commercially viable so that it doesn’t become a barrier to the research, development and commercialisation activities of others. This is to avoid licensees having an exclusive licence where they are not doing anything with the relevant intellectual property and the intellectual property remaining unused.

As well as the right to step in, we expect you to have the right to take back responsibility for filing, prosecuting and maintaining Wellcome-funded intellectual property at your own cost if your commercialisation partner has been given this responsibility and has failed to do so adequately. This may be necessary when dealing with early spin-out companies, if their financial resources are limited.

If you want to grant an exclusive licence to a commercial third party, we expect you to evaluate whether exclusivity is really the most appropriate way of achieving the maximum public health benefit. 

We appreciate that exclusivity is often needed to attract the investment necessary to successfully commercialise Wellcome-funded intellectual property. However, in cases where Wellcome-funded intellectual property underlies a new research field or could act as a fundamental platform for further important work, the public health benefit may be best achieved by:

• a series of non-exclusive licences
• a series of field and/or territory-limited exclusive licences 

This avoids giving one party a broad blocking position and controlling intellectual property rights which it is not fully using.

The licensor should typically restrict the licence (especially any exclusive licences) to a defined field of use. This field should align to the licensees’ immediate plans and to its capabilities and resources.

Where a licensee negotiates a broad field (or the removal of field limitations) the agreement must balance this with appropriate diligence obligations and step-in rights. These obligations and rights must ensure that unmet health needs, which could be addressed by the intellectual property in question, do not remain unserved due to the commercial priorities, or the limited capabilities or resources, of the licensee.

We do not give specific guidance on the amount of return that an organisation should get from commercialisation, but we will check that the return is not obviously disproportionate to the organisation’s contribution. 

As required by charity law, this ensures that the private benefit to the commercialisation partner is limited and does not outweigh the public benefit arising from the commercialisation of Wellcome-funded intellectual property.

Pipeline arrangements are where a company receives or pays for the right of first refusal to research outputs from a lab, department, or even an entire organisation.

This may have the positive impact of bringing in funding to an organisation, but it agrees to forward-sell the Wellcome-funded intellectual property. You must balance this against the considerations discussed in this guidance around commercialising partners.

The administering organisation must not enter such an arrangement unless:

• the scope of Wellcome-funded intellectual property which could be involved is assessed and understood
• the third party is clearly a suitable commercialisation partner for the specific type of Wellcome funded intellectual property involved
• the organisation receives an appropriate return
• the organisation is reassured that the arrangement is in line with Wellcome’s intellectual property policy and this guidance.
   

We encourage you to insert provisions in all agreements relating to the commercialisation of Wellcome‐funded intellectual property to inform your counterparties that Wellcome will review the unredacted agreement, ideally specifically naming Wellcome.

Example wording for a clause reflecting this provision:

The Licensor may disclose Confidential Information [as defined in the agreement] of the Licensee (including but not limited to a copy of this Agreement) to any Third Party (including but not limited to the Wellcome Trust) who was involved in the development of the Licensed Intellectual Property Rights/Licensed Products/Services [as defined in the agreement] including the creation, invention or funding of the Licensed Intellectual Property Rights/Licensed Products/Services.

For agreements relating to Wellcome-funded intellectual property going into a spin‐out company, your organisation should make it clear at the beginning of the agreement that the commercialising party is a spin-out.

If the spin out is being founded or run by the principal investigator or another of the organisation’s academics, Wellcome expects the commercialisation agreement to still be made on commercial arms-length terms.

This expectation of objectivity includes a strong focus on future health impact. For example, organisations should consider what the spin‐out company needs to achieve in terms of technology development or moving the product towards market. If you are granting exclusive rights, the agreement must include diligence requirements related to technology development and/or raising sufficient capital to properly develop the intellectual property.

Wellcome-funded intellectual property must not be assigned to a spin out until it has demonstrated that it can realise the full potential of that intellectual property to deliver health impact.

Your organisation should prioritise rapid development of the Wellcome-funded intellectual property, to maximise the health impact being achieved. We expect agreements to set out clear consequences in case of disagreements around commercialisation, with an emphasis on achieving a speedy resolution. 

Wellcome encourages organisations to use independent experts to help resolve disputes and to make diligence requirements based on ‘commercially reasonable endeavours’ more enforceable. The expert should determine whether efforts have been sufficient and if not, they should specify what actions the commercialisation partner needs to take to remedy the breach.

We expect that the organisation will reserve the right, for itself and others, to use Wellcome-funded intellectual property for academic research and teaching. At a minimum this should ensure that its own researchers are free to use it. More preferably, the intellectual property should be sub-licensable to facilitate collaboration and non-commercial research and development at other organisations.

Organisations should draft agreements clearly, to avoid ambiguity. We recommend inserting brief recitals at the beginning of agreements with some background on the agreement to provide context. Organisations should also ensure agreements include basic boilerplate provisions such as governing law, termination clauses, and that the consequences of termination (and how those impact Wellcome-funded intellectual property) are clear.