Transferring Technology can leverage global investments.

• Author: Barbur, Vicki A.
• Position: Viewpoint

Today's global economies are based on the command of knowledge and information. Knowledge in this sense is created by basic and applied research.

Incorporating emerging and advanced technologies that are positioned for technology transfer can increase benefits to society and defense of the nation--outcomes that are within the bounds of public interest. Enhancing economic prosperity through job creation, providing access to breakthrough capabilities to protect a nation and creating long-term investment in R&D are all critical to success.

International technology transfer is a valuable mechanism that can benefit both local and foreign governments and industries. It can also boost economic growth and regional economic development by being the catalyst for the creation of new, entrepreneurial business ventures.

Evaluating overall return on investment from these activities to date is ongoing, yet it is increasingly clear that technology transfer is becoming a central feature of the research-and-development system.

Technology transfer is defined as the movement of scientific methods of production or distribution from one enterprise, institution, or country to another, as through foreign investment, international trade, licensing of patent rights, technical assistance, or training.

The process to commercially leverage the output of research and development efforts varies widely. Exposure to the leading international companies, corporations and national laboratories as part of early stage innovation provides an opportunity to participate in technology exchange--technology transition/transfer in its broadest global context--alongside opportunities for partnering and collaboration, and related licensing and venture investments to and from within-country groups.

In addition, these channels create opportunities for direct communication with organizations where new products or services can add value to a targeted group of industry professionals.

Technology and technical know-how are typically transferred through a license agreement in which the entity grants its rights without relinquishing ownership--or government use rights, in the case of nationally funded initiatives--in the defined technology to a third party for a period of years, often limited to a specific field of use and/or region of the world, for financial and other benefits.

The licensee--the third party licensing the technology--may be an established company or a new business start-up. Licenses are essentially contracts that include terms requiring the licensee to meet certain performance requirements and at times to make financial payments--some of which may be royalties--to the originator of the technology.

An option agreement is sometimes used to enable a third party to evaluate the technology for a limited period of time prior to making any decision about licensing. Some portion of...