Material transfer agreements FAQs

How are technologies and patent rights licensed?

Generally speaking, licensing and related commercialization agreements are entered into on an exclusive or non-exclusive basis. Some technologies having multiple applications may be licensed exclusively but only for a specific field(s) of use; similarly, some technologies may be licensed exclusively but only for a specific location. There are numerous alternative commercialization options.

Research agreements that anticipate the development of intellectual property often include clauses that grant the right of first refusal to the sponsor to enter into an exclusive option or license agreement. Such rights must be time-limited—usually from the date of disclosure of the development of IP to the sponsor.

What is the difference between option agreements and license agreements?

Option agreements are often used to give a potential licensee time to perform due diligence on the technology while keeping others from obtaining rights to the technology. Option agreements are also time-limited, usually not exceeding one year.

License agreements take many forms, depending on the technology being licensed and the nature of the licensee.