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Discovery DiscoveryMay 1999
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by Becky Mahurin

Montana State University pursues the transfer of its technology for the benefit of the public. We look at how best to get the potential product into the hands of the consumer, whether that be a new drug candidate, a tool for measuring biofilms or a new plant variety. In transferring our technologies, we have to understand the market, the distribution network for that classification of product, and the culture of that segment of the economy.

In transferring pharmaceutical products to the market, an exclusive license is almost always the only way companies are willing to license. A pharmaceutical company will spend in the neighborhood of $150 million to get a product through the Food and Drug Administration regulatory process and ready for market. Only if the company has a mechanism to recoup this investment will it be willing to take such a risk. Exclusivity is the mechanism most commonly used.

In the plant variety area, many growers are accustomed to a free, public release of seed and believe that is best for growers and consumers. In fact, sometimes this is not the best strategy. MSU has in place an Exclusive Release Policy that determines when a grain may be considered for exclusive licensing. Following determination that a variety is ready for release, a committee composed of both campus and private-sector representatives will consider exclusive release. Factors important in such consideration include whether further development is necessary for this variety, if expensive and extensive regulatory processes are necessary before release, and if a variety must be identity preserved.

Regulatory concerns may be present if a variety has been developed as pesticide- or herbicide-resistant. Such regulatory processes are extremely expensive and usually are not performed by universities. Similar to the pharmaceutical example, no company is willing to undertake the expense and risk without considerable potential gain. Again, this is usually in the form of an exclusive arrangement for marketing the product. Identity preservation may also be an issue. For a unique product, it may be necessary to preserve the identity or purity of the commodity such that a premium may be payed to the grower and processor. A good example is hard white winter wheat. If this wheat is contaminated with red wheat in harvesting, storage or processing, the extra value of the white over the red wheat will be lost. So it is necessary to license to an entity that has the capability to preserve the wheat's identity and purity through processing so that a higher price can be realized for all.

Thus, the Exclusive Release Committee has to consider if it is necessary to license to one entity so that the true value of the crop can be realized for the farmer and processor. If the answer to this question is "yes," then an exclusive release is approved.

Some people have misunderstood our exclusive release process for various technologies. Our intent is not to earn greater benefits for the university, but to earn greater benefits for the consumer and producer. Without this understanding of market philosophy, our efforts in the laboratory will be unsuccessful in achieving our main goals-a better product for the end-user and potentially greater profit for the producer.

Should you have questions about our Exclusive Release Policy or other technology transfer issues, please contact me at 994-7868.

Becky Mahurin
irector of the Technology Transfer Office at MSU.



© 2000 Montana State University-Bozeman

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