Research

REG10.00.3

Royalty Sharing under NCSU's Patent Policy And Procedures

Authority: Issued by the Chancellor. Changes or exceptions to administrative regulations issued by the Chancellor may only be made by the Chancellor.

History: First issued, December 18, 2002. Endorsed by the University Council, April 14, 2003.

Related Policies: Patent Policy and Procedures; UNC Patent and Copyright Policies, UNC Administrative Manual, Chapter V. B.

Contact Info:  

1. Introduction

NC State University encourages innovation by its faculty, staff and students. When those innovations are licensed and generate income for the university, that income is shared with those who made the innovation according to the following Administrative Regulation.

2. Revenue Sharing Formula and Regulations
   
   
1. Gross Revenue means all income actually received by the University as consideration for the licensing, optioning, or other transfer of rights to inventions that are subject to the University's Patent Policy and Procedures. Gross Revenue includes, but is not limited to, such things as royalties, license issue fees and milestone payments that are generated through the licensing of an invention. Gross Revenues actually received by the University is the basis on which the inventor's share of revenue is calculated.
   
   
2. If there is a specific agreement in a grant or contract with a sponsor or licensee that requires the University to share revenues with the sponsor or to deduct relevant costs and expenses, then the inventor's share of the revenue will be calculated after deducting the amount that must be shared with the sponsor. Similarly, if the University is required to share revenues under an inter-institutional agreement with another entity, such as when there is a co-inventor at the other entity, then the inventor's share of the revenue will be calculated after deducting the amount that must be shared with the other entity.
   
   
3. Any income from licensing activity that is received in the form of support (in cash or in kind or otherwise) for research or any other form of sponsored research is not part of the Gross Revenue.
   
   
4. For distributions of any Gross Revenue that is generated as a result of sales by licensees or any "trigger event" in a license or option agreement (such as up front fees, milestone payments, minimum royalty payments, and the like) where the sales or the trigger event occurred on or after July 1, 2002, the inventors' share of Gross Revenue is 40%, unless otherwise agreed in writing between the University and the inventor(s).
   
   
5. For all distributions of Gross Revenue that relate to sales or trigger events prior to those described in D., above, distributions will be in accordance with University's distribution policies (as approved by the Intellectual Property Committee) existing as of the date that the applicable sales or trigger event occurred.
   
   
6. Where there two or more co-inventors, the applicable percentage of Gross Revenue is divided equally among all co-inventors, unless all co-inventors, with the concurrence of the Intellectual Property Committee, establish in writing a different share to be appropriate.
   
   
7. Applicable laws, regulations or provisions of grants or contracts may require that a lesser share be paid to the inventor, and in such cases the University must comply with the provisions of those laws, regulations, grants and contracts.
   
   
8. In no event may the amount payable by the University to the inventor or inventors in the aggregate be less than 15% of Gross Revenue.
   
   
9. Once Gross Revenues are received, the Office of Technology Transfer will initiate distribution of inventors' share of the revenue as promptly as is reasonably practical. The Director will inform inventors of any exceptional circumstances that may cause a delay of distribution.