Engaging in Research
Industry Sponsored Research
Industry sponsored research is undertaken by university personnel and students to address need that has been identified by the sponsor. Projects may involve basic or applied research and are aimed at discovery and interpretation of facts, development of new analytical and experimental protocols or practical application of new theories, analysis, data gathering and experiments.
A sponsor is entitled to utilize the results and any technology that is developed during the research project for their internal research purposes. In the event a patentable technology (invention) is developed in the course of the research project, ownership of that invention would be determined by inventorship, in accordance with US Patent Law.
A sponsor is always provided with prompt notice of any invention and receives the first option to license such invention for its own commercial purposes. NDSU would retain the right to publish the results of the research project and utilize the invention for teaching and research purposes.
Although an industrial sponsor may desire a specific outcome that benefits its operations, NDSU cannot guarantee a specific outcome or warranty the results of any research project.
The following information provides an overview of available research programs and contracting options for engaging NDSU in research endeavors.
Sponsored Research Project with Defined Scope of Work
The Industry Sponsored Research Agreement, which has been used by the university for many years, is a straightforward contract that addresses the issues inherent in sponsoring basic research and is suitable for a wide variety of projects. This traditional contract includes intellectual property (IP) terms that are consistent with federal policy and prevailing higher education practices and provides sponsors with exclusive rights to commercialize any technology that is developed in the performance of the research. A sample agreement template is available for review.
For applied research projects, NDSU can, upon approval from the identified researchers, offer alternative licensing options which include a limited term non-exclusive royalty free (NERF) agreement* to evaluate the technology, a NERF agreement with the time-limited option for an exclusive, royalty-bearing license*, and an advanced license agreement that includes present licensing terms*.
Assessment NERF
Features of the Assessment NERF
- Upon project approval, a sponsor may elect to negotiate a research agreement which provides the sponsor with a limited-term, commercial, non-exclusive, royalty-free license in a defined field of use for any invention that is conceived or reduced to practice in the performance of the research.
- Project approval is required by the researchers that will be involved in the project; their college; and the Vice President of Research.
- The Assessment NERF is intended to allow sponsor an opportunity to further develop the invention and assess the commercial market for such invention.
- The Assessment NERF will also allow sponsor the option of extending the non-exclusive license at commercially reasonable rates after the initial term. The election to extend the license must be provided to NDSU six months prior to the end of the five year term.
- The funding provided by sponsor for the research project must include all personnel and other expenses reasonably associated with the performance of the research, including an assessment of indirect costs based upon NDSU’s Federally Negotiated Rate. Research expenses will also include lab/facility rent if the researcher’s regular lab is located in a bond-financed building.
- NDSU background IP is not included in Assessment NERF, but may be otherwise available on commercially reasonable terms.
- The maximum term of the Assessment NERF is five years.
- No sublicensing rights are granted to sponsor.
- The Assessment NERF is contingent upon sponsor’s continued payment of all patent expenses for the invention and full payment of the research expenses.
- The license territory is limited to those countries in which sponsor elects to patent invention.
- These standard terms are not negotiable. If sponsor desires alternative terms a different invention rights option should be selected.
Option NERF
Features of the Option NERF License:
- Upon project approval, a sponsor may elect to negotiate a research agreement which provides the sponsor with commercial, non-exclusive, royalty-free license in a defined field of use for any invention that is conceived or reduced to practice in the performance of the research.
- Project approval is required by the researchers that will be involved in the project; their college; and the Vice President of Research.
- The Option NERF will allow sponsor the option of converting the Option NERF to an exclusive, royalty-bearing license. Notice of sponsor’s intention to negotiate an exclusive, royalty bearing license must be provided to NDSU within six months from its receipt of the initial invention disclosure.
- Sponsor is required to pay a non-refundable, issue fee equal to 5% of total project costs (direct and indirect expenses) prior to the start of the research. The minimum issue fee is $7,500.
- The funding provided by sponsor for the research project must include all personnel and other expenses reasonably associated with the performance of the research, including an assessment of indirect costs based upon NDSU’s Federally Negotiated Rate. Research expenses will also include lab/facility rent if the researcher’s regular lab is located in a bond-financed building.
- NDSU background IP is not included in Option NERF, but may be otherwise available on commercially reasonable terms.
- No sublicensing rights are granted to sponsor under the Option NERF. Sublicensing rights will be granted to sponsor in any exclusive license.
- The Option NERF is contingent upon sponsor’s continued payment of all patent expenses for the invention and full payment of the research expenses.
- The license territory is limited to those countries in which sponsor elects to patent invention.
- These standard terms are not negotiable. If sponsor desires alternative terms a different invention rights option should be selected.
Advance License
Features of the Advance License:
- Upon project approval, a sponsor may elect to negotiate a research agreement which provides the sponsor with the right to an exclusive, commercial license in a defined field of use for any invention that is conceived or reduced to practice in the performance of the research.
- Project approval is required by the researchers that will be involved in the project; their college; and the Vice President of Research.
- The Advance License is royalty-free until annual net sales reach $20M, at which time a royalty rate of 1% of net sales will commence and be payable on an annual basis thereafter. If the invention is an improvement to sponsor’s background IP, total royalties payable to NDSU are limited to $5M.
- Sponsor is required to pay a non-refundable, issue fee equal to 10% of total project costs (direct and indirect expenses) prior to the start of the research. The minimum issue fee is $15,000.
- The funding provided by sponsor for the research project must include all personnel and other expenses reasonably associated with the performance of the research, including an assessment of indirect costs based upon NDSU’s Federally Negotiated Rate. Research expenses will also include lab/facility rent if the researcher’s regular lab is located in a bond-financed building.
- NDSU background IP is not included in Advance License, but may be otherwise available on commercially reasonable terms.
- Sponsor may sublicense its commercial rights.
- Sponsor is required to provide NDSU with an annual accounting of sales involving any invention.
- The Advance License is contingent upon sponsor’s continued payment of all patent expenses for the invention and full payment of the research expenses.
- The license territory is limited to those countries in which sponsor elects to patent invention.
- These standard terms are not negotiable. If sponsor desires alternative terms a different invention rights option should be selected.