Case Study: Advice on Licensing Deal Structures in the Food Industry
Industry Expertise: Food & Nutrition
Supported by Enterprise Ireland, Food for Health Ireland (FHI) links the world-class scientific research at University College Cork, University College Dublin, NUI Galway, NUI Maynooth, DCU, Teagasc, Moorepark Food Research Centre, and University of Limerick with the marketing power of industry partners Ornua, Carbery Group, Dairygold Food Ingredients Ltd, Glanbia Ireland DAC and Kerry Group plc. FHI has a multidisciplinary team of 71 scientists including a management team based in University College Dublin. FHI entered its second phase of research in September 2013, funded by €21M from Enterprise Ireland and the company partners.
FHI is one of the largest technology centres in Ireland and its primary remit is to identify novel ingredients coming from milk to develop functional food ingredients which will offer health benefits to consumers. This research is focusing on infant nutrition, healthy cheese, appetite modulation, performance nutrition and healthy ageing as well as products that can be used to manage elevated glucose levels. Recently, the program has announced promising results from human intervention studies on its glycemic management and healthy ageing research platforms as well as from its infant nutrition and healthy cheese programmes.
IP Pragmatics has been appointed as the Independent Evaluator for the FHI project to assess the terms of commercialisation agreements entered into under the programme to determine that fair market value is being obtained, and to assist with the admission of new participants to the project.
Over more than 3 years, we have been working with the consortium as it transitioned from a research focus into its next phase, with a pipeline of translational projects moving into partnering discussions.
Initially, we set up a general model and reference framework which describes general license / IP terms in the area of nutrition, health, wellbeing, functional foods and respective technologies. This considered elements including upfront payments, royalty rates, ways of working, and so on. To compile this framework, we examined the functional food market supply chain and value sharing models. We provided information on third party licensing deals in the functional food sector and interviewed stakeholders within and outside the FHI consortium to understand their perspectives on previous deals in the sector.
This general model / reference framework was discussed and agreed with both the research and industrial partners within FHI. Subsequently, it has been used to compare specific proposed licences against to test the fair value criteria. Using the framework, the consortium has completed a growing number of individual licences, with more in the pipeline as the FHI research progresses.
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