Industry Engagement Options: Template Agreement Structures for Research and Technology Development with Industry

A major aspect of our mission is to promote the progress of science and technology and to assure that discoveries and inventions are used to benefit the public and the broad communities that we serve in our role as a public research university.

The Wayne State University Office of Technology Commercialization is responsible for all aspects of the technology/invention disclosure process and for the protection (patenting), marketing and licensing of university inventions. A list of available technologies for licensing, an outline of innovation and proof-of-concept programs embedded in the office and further information is available at (313) 577-5655 or email

Recognizing that the engagement of university research laboratories with industry partners may take various forms, we have developed a series of template agreement options to accommodate special needs in regards to technology development, research funding and intellectual property (IP) for industry partners.  These options are defined as follows.

Specialized Services Agreements

Specialized Services agreements offer a simplified template  for industry partners to access Wayne State technology resources on well-defined, specific projects where there is no expectation for the creation of new intellectual property. In the agreement, the sponsor is given an unrestricted free right to use all the data and results from testing or other services.

Specialized services may involve using specialized scientific and analytic instrumentation, as well as, machine shops, and enlisting panels of trained subject-matter experts as needed for consultation on those services.

Specialized service agreements may involve Graduate Research Assistants as appropriate. In accordance with our educational and academic mission, students must be able to publish their work and any agreement typically includes language to this effect. In recognition of the potential confidential nature of proprietary corporate information, the agreement provides a structure for sponsor review of any planned publications or presentations.

Sponsored Research Agreements

Industry sponsored research projects are typically encompassed with a sponsored research agreement template that provides an overall project description and the identification of key milestones, the roles and responsibilities of individuals and teams involved and anticipated project costs.

Sponsored research projects may lead to development of new intellectual property (IP).   For any project receiving federal funding there are clearly defined regulations regarding the ownership and distribution of any such IP generated through federally funded projects as defined by the Bayh-Dole act of 1980 (Patent and Trademark Law Amendments Act). IP created by Wayne State University employees is owned by the university.

For industry sponsored research projects, the management structure for any IP that may be generated during the funded project is defined in the agreement.

Ownership of inventions created pursuant to sponsored research with the university depend on which individuals were involved in the creation of the invention. The sponsoring entity owns all inventions developed solely by its personnel and Wayne State would own all inventions developed solely by its personnel.

In industry sponsored projects there may be situations where both parties contribute to an invention and in this case there is actually joint ownership of the IP by the university and the industry partner and each party may use the invention for research and commercialization.  Should the industry sponsor want exclusive use of the joint IP, it may, according to the terms in the agreement, license the university's interest in the joint IP for its sole commercial use. Under such circumstances, the university retains the right to use the IP for internal research and education.

Recognizing that the engagement of university research laboratories with industry partners may take various forms, we have developed a series of licensing options to accommodate special needs in regards to IP, technology development and research funding for industry partners.  These options are defined in Appendix 3 of the SPONSORED AGREEMENT FOR RESEARCH AND TECHNOLOGY DEVELOPMENT WITH INDUSTRY and briefly summarized as below.

Please note that University faculty-founded companies must have previously licensed background IP to be eligible for Option B or C.

Sponsored Research Agreement – Licensing Option A

Provides the sponsor the opportunity to defer investment in any project IP license until such time as the project IP is identified and valued.  No predetermined IP terms are available. IP licensing terms (exclusive or non-exclusive) are negotiated after IP has been generated.

Upon licensing, the sponsor has the right to control patent prosecution and the university has the right to review all applications and comment, and the right to file/prosecute/maintain patents in any non-elected territories. The university retains the right to use the IP for internal research and education.

Sponsored Research Agreement -  Licensing option B – Exclusive license with royalty terms

Provides the industry sponsor an exclusive license to any resulting IP in the field of use as defined in the sponsored research agreement. 

This agreement requires prepayment of an IP fee. The fee is equal to 10% of the Sponsored Research Agreement and is non-refundable.  The exclusive license includes sublicensing rights to the sponsor. Should net sales on products derived from the use of Wayne State University project IP exceed $10M, there will be a 1% royalty rate to the university.

To be eligible for Option B, the sponsored research contract must have an annual direct costs budget greater than $150,000 and the budget would also include Facilities & Administration costs at established institutional rates.

Sponsored Research Agreement -  Licensing option C – Non-exclusive, royalty free license

Provides the industry sponsor with a non-exclusive, worldwide, royalty free license for research and commercial use.  Sublicensing rights for the sponsor are not included as part of the initial agreement.  The industry sponsor also receives an option to negotiate for an exclusive, royalty-bearing license. 

This agreement requires prepayment of an IP fee. The fee is equal to 10% of the Sponsored Research Agreement and is non-refundable.

To be eligible for Option C, the sponsored research contract must have an annual direct costs budget greater than $100,000 and the budget would also include Facilities & Administration costs at established institutional rates.

Intellectual Property, University Operations and Licensing Guidelines

In establishing a research collaboration between the university and an industry partner, there are a few principles, spelled out in detail in the overall agreement, that need to be considered and are summarized below.   Additional information is found in the WAYNE STATE UNIVERSITY PATENT AND COPYRIGHT POLICY AND COMPUTER SOFTWARE POLICY

As a large research university, Wayne State has all of the infrastructure and established policies and procedures for appropriate regulatory and safety requirements for any research project that it may be involved with.

Background IP -  Background IP means intellectual property that is proprietary to a specific Party and was conceived, created, or prior to, or independent of, any research performed pursuant to this Agreement and may be necessary for the performance of the project.

Background IP is identified in advance and documented as such in the Scope of Work for any sponsored project/contract.   Background IP retains existing ownership.  As part of a business strategy, the industry sponsor may desire access to university background IP and such IP can be licensed through the standard process.

Confidentiality/non-disclosure – As may be necessary in the performance of the research, there may be disclosures of confidential information from the sponsor and/or the university to those involved in the project. That information will remain in confidence to those directly involved for the duration of the project and a defined period afterwards as defined in the sponsored research agreement and a confidentiality/non-disclosure agreement.  The disclosure of confidential information may be bilateral (e.g. between both the university and the company) or unilateral (e.g. from one entity to another).

Copyright and copyrightable material – Such material (including non-patentable computer software) made by an University employee vests with University and the sponsor receives a non-exclusive royalty free license for its internal use.

Governing Law – It is difficult for Wayne State University to enter into a contractual arrangement that incorporates the law of any jurisdiction other than the State of Michigan. When a problem of governing law arises, Wayne State University typically suggests going silent on the issue.

Indemnification - Wayne State University cannot agree to indemnity and hold harmless clauses.

Limitation or Waiver of Liability  - Wayne State University cannot normally agree to limit a licensee's liability.

Project Funds - Industry grants and contracts which support sponsored projects should include direct project costs and established university facilities and administration (F & A) costs (54% for organized research on campus, 32% for clinical trials and 26% for organized research primarily conducted at an off campus site).

Publication – As a public, non-profit academic research university, sharing of research results, creative contributions and general knowledge generated by faculty and students through publications and presentations is key component of our mission and in accordance with principles of academic freedom. Thus, Wayne State University cannot agree to restrictions related to publications and presentations. However, the University may agree to submit the proposed publication or presentation to the sponsor for review prior to submission for publication or prior to presentation and would exclude sponsor-provided privileged and/or proprietary information from such publications or presentations as appropriate.

Royalty Distributions – Royalties generated through licensing of Wayne State University patents to external users or to University employees are distributed by established policy.  Gross royalty income returning to the University will first be used to repay all costs associated with patent development, patent application and licensing.  Following the deduction of such expenses, net royalty income will be distributed among the inventor(s) and other University units according to the following formula.

Net Income




Up to $10,000




Next $90,000




Next $900,000




Over $1 million




Warranty - Wayne State University cannot provide any type of warranty or indemnify a third party for any breach of representation or warranty.