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Jul 21, 201612:50 PMLegal Login

with Mindi Giftos

Is your company capturing the benefits of collaborative R&D?

A new report by the Industrial Research Institute in Washington, D.C. forecasts that global research and development (R&D) spending will increase by 3.5% in 2016 and reach nearly $2 trillion in value. About one quarter of the spend ($514 billion) will occur in the United States, with the remainder primarily in Asia and Europe.

The benefits of collaborative R&D are numerous. Many U.S. companies increasingly look to jointly develop new products in collaboration with key partners. Who are your key partners for purposes of R&D?

Perhaps you will find R&D partners among your strategic vendors, customers, local universities, and research institutions. One such partner may be the University of Wisconsin, which was ranked fourth among all U.S. universities in total R&D spending, behind only Johns Hopkins, the University of Michigan, and the University of Washington. By collaborating, these partners share their financial and intellectual resources to yield more favorable results than going it alone.

If you are a company that would like to engage in more collaborative R&D, you might wonder how these arrangements are structured. Typically, they are structured through a formal written legal document referred to as a joint development agreement or similar name. The title of the agreement is less important than its content.

To capture the benefits of collaboration, a proper joint development agreement must be prepared at the outset of a project. The agreement should detail the respective obligations and benefits that will accrue to each party. Typically, these agreements address considerations such as the scope of the parties’ development activities, cost allocations, project management, rights in existing intellectual property (IP), ownership of new IP, patent prosecution and enforcement, commercialization rights, regulatory compliance, product liability, limitations of liability, assignment of rights, and bankruptcy risk.

In the industrial Midwest, we might be tempted to view collaborative R&D as the domain of manufacturing companies. While accurate in part, this type of collaboration is even more relevant to emerging sectors such as life sciences, artificial intelligence, big data, bioengineering, nanotechnology, information technology, medical diagnostics, and robotics. In its 2016 Technology Vision report, Accenture refers to an emerging platform economy where companies will unleash the power of digital platforms to collaborate in new and innovative ways.

In whatever capacity your company engages in R&D, your efforts will increasingly involve resource sharing with third parties. Before embarking on this collaborative effort, be mindful of the importance of a written joint development agreement. It may be the difference between realizing the return on your R&D investment or not.

Andrew Schlidt is an attorney with Husch Blackwell practicing corporate and technology law. He can be reached at andrew.schlidt@huschblackwell.com.

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The Technology Law Team at Husch Blackwell addresses the unique challenges inherent in contracting and claims resolution processes involving the design, development, implementation, operation, and maintenance of complex information technology, telecommunications, and e-commerce solutions.

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