Ohio Administrative Code › Title 3341 - Bowling Green State University › Chapter 3341-7 - Research › Section 3341-7-06 - Commercialization

Current through all regulations passed and filed through July 1,
			 2024
(A) Policy
			 statement and purpose
Bowling Green state university is a state institution of higher
				education that holds undergraduate and graduate education as its number one
				priority, and, the primary responsibility of the university professor is "to
				educate." As part of the education process, BGSU encourages its faculty, staff
				and students to conduct research. By virtue of what they do, certain university
				faculty, staff or students may produce commercial opportunities based on their
				research work. The university is obligated by state of Ohio law to protect
				resulting intellectual property and to promote its full development and public
				use. In doing so, it also has an obligation to the faculty member, staff or
				student and to the public interest, to provide the flexibility needed to
				advance the research, attract investors and to achieve commercialization of the
				product. That flexibility is defined by this policy.
(B) Policy
(1) Pursuant to section
			 3345.14 of the Revised Code,
			 Bowling Green state university's (BGSU) board of trustees has determined that
			 employees of the institution may be afforded the opportunity to hold personal
			 financial interests in companies commercializing technology developed in
			 conjunction with their BGSU research and development activities. The board
			 recognizes that participation by employees of BGSU in the ownership and
			 commercialization of technology and other intellectual property may increase
			 the transfer of discoveries and knowledge generated at BGSU to the private
			 marketplace by providing an incentive for faculty who develop inventions with
			 commercial applications. The opportunity to participate in these transactions
			 is also essential to BGSU's efforts to attract and retain highly qualified
			 faculty, staff or student. The procedures and guidelines set forth in this
			 policy are intended to enable the university to realize the benefits of these
			 entrepreneurial activities while protecting the integrity of its research and
			 educational mission and to comply with BGSU policies and applicable federal and
			 state laws. These rules serve as an exception to the Ohio ethics law and
			 related statutes [Chapter 102. and sections
			 2921.42 and
			 2921.43 of the Revised Code],
			 which might otherwise apply. Matters outside the scope of these rules will be
			 subject to such laws to the extent applicable.
(2) Procedure:
(a) Definitions
(i) A commercialization company is a private,
			 commercial entity that is owned in whole or in part by a university employee
			 and that has as its purpose, the development and commercialization of
			 university owned intellectual property created by that employee.
(ii) BGSU's ownership of intellectual
			 property rights in technology created by its faculty, staff or students is
			 determined in accordance with section
			 3345.14 of the Revised Code and
			 the BGSU policy on patents and copyrights. As more fully explained in the
			 policy on patents and copyrights, university owned technology generally does
			 not include textbooks and other scholarly or artistic works created with
			 minimal use of BGSU resources.
(iii) A BGSU employee is any member of the
			 faculty or staff, including, but not limited to full-time and part-time
			 faculty, adjunct faculty, non-tenure track research faculty, postdoctoral
			 fellows, classified and administrative employees, graduate assistants/
			 students, work-study students, employed undergraduate assistants, and
			 technicians.
(iv) The patent
			 advisory and technology commercialization oversight committee is a university
			 body responsible for making recommendations to the vice president for research
			 and economic engagement
											 regarding commercialization
			 companies.
(v) The vice president
			 for research and economic engagement  is the university official who is
			 responsible for assisting employees of BGSU in identifying, managing and
			 eliminating conflicts of interest, and in developing conflict of interest
			 management plans for employees of BGSU involved in the development of
			 commercialization companies.
(vi)
			 The sponsored programs and research office is the unit of the institution
			 charged with providing leadership in setting the research agenda of the
			 university and facilitating and overseeing research and sponsored programs and
			 technology transfer.
(b)
			 Applicability
(i) This policy shall apply to
			 all BGSU employees.
(ii) This
			 policy shall apply to students who
(a) engage
			 in research and development activities
(b) create intellectual property owned by
			 BGSU; and
(c) desire to hold an
			 ownership interest in a commercialization company.
(c) Responsibilities of department
			 chairs, school directors, center directors, and staff supervisors
(i) Department chairs and school directors
			 are responsible for ensuring that faculty who participate in commercialization
			 companies comply with applicable university policies governing the terms and
			 conditions of employment, academic and research activities. Department chairs
			 and school directors are also responsible for ensuring compliance with the
			 policies on consulting and conflict of interest, and for reviewing and making
			 recommendations as to the propriety of private business activities as reported
			 by their faculty in disclosure forms required by those policies.
(ii) Center directors are responsible for
			 ensuring that members of their centers who participate in commercialization
			 companies comply with applicable university policies governing the terms and
			 conditions of employment and academic and research activities. Center directors
			 are also responsible for ensuring compliance with the university policies on
			 consulting, conflict of commitment, and conflict of interest. Further, they are
			 responsible for reviewing and making recommendations addressing the propriety
			 of private business activities as reported by their faculty in any required
			 disclosure forms.
(iii) Staff
			 supervisors are responsible for ensuring that staff members who participate in
			 technology commercialization companies comply with this policy. They are also
			 responsible for ensuring compliance with the university policies on conflict of
			 interest and working outside the university applicable to staff employees and
			 for reviewing and making a recommendation as to the propriety of private
			 business activities reported by staff in disclosure forms required by those
			 policies.
(d) Approval
			 process
(i) Faculty and staff members or
			 students who wish to participate in a commercialization company must first
			 obtain approval from their department chairs, school or center directors, and
			 deans or other appropriate supervisors. The vice president for research and
			 economic engagement
											 will be responsible for negotiating the
			 business terms of the transaction between the company and BGSU, and will
			 facilitate the development of a conflict-of-interest management plan, in
			 consultation with the patent advisory and technology commercialization
			 oversight committee.
(ii) The
			 patent advisory and technology commercialization oversight committee will
			 review the sufficiency of business terms and conflict of interest management
			 plans relating to technology commercialization companies. Written approval from
			 this committee must be obtained before any business agreements relating to a
			 technology commercialization company are finalized.
(iii) Faculty, staff or students who wish to
			 participate in a commercialization company may discuss initial company
			 formation with the sponsored programs and research office; however, they should
			 not, as a general rule, participate in the ongoing negotiation of option and
			 licensing terms between the company and BGSU. As soon as possible, third
			 parties, such as company management and/or legal counsel should perform this
			 function.
(iv) As a prerequisite to
			 the granting of an exclusive license to BGSU technology, a commercialization
			 company must provide the vice president for research and economic
			 engagement with a due diligence review as
			 evidenced by the following:
(a) A
			 capitalization plan demonstrating access to funds necessary for company
			 growth;
(b) A proposed management
			 team;
(c) Milestones for product
			 development and commercial sale
(d)
			 A periodic review of progress within a timeframe identified at the time of
			 negotiation; and
(e) Reversionary
			 rights for the institution when company fails due-diligence after a mutually
			 agreed-upon period of time.
(v) In recognition of the university's
			 ownership of the technology or invention, a commercialization company in early
			 stage may grant the university an equity interest in the company as negotiated
			 by the office of sponsored programs and research and approved by the vice
			 president for research and economic engagement
											, to be held by
			 centennial falcon properties, inc. or any of its
			 subsidaries..
(vi) The
			 faculty member's department chair, school director, center director, dean or
			 staff supervisor shall be active participants in discussions with the office of
			 sponsored programs and research and in the development of conflict of interest
			 management plans relating to a commercialization company.
(vii) A chair, school director, center
			 director or staff supervisor who has a financial interest or is a
			 co-participant with a faculty, staff member or student in a commercialization
			 company is not in a position to provide effective oversight of that activity.
			 In these situations, another disinterested administrator must be appointed to
			 perform the responsibilities of the chair, center director or staff
			 supervisor.
(viii) If the patent
			 advisory and technology commercialization oversight committee members determine
			 that, for any reason, it is not possible for the chair, school director, center
			 director, the staff supervisor or another disinterested administrator to
			 provide effective oversight of a transaction involving a commercialization
			 company, the transaction should not be approved.
(e) Responsibility for university duties
(i) Faculty members are encouraged to develop
			 discoveries and inventions with commercial potential within the broader
			 teaching and research mission of BGSU. Care must be taken that faculty not
			 allow their interest in a financial opportunity arising out of their research
			 efforts to result in a potential for either a conflict of interest or a
			 conflict of commitment to the institution, or the misuse of students, employees
			 or resources of the university for benefit of the company.
(ii) While faculty members are permitted to
			 serve as consultants to commercialization companies and other private
			 enterprises, they continue to be responsible for all of their university
			 teaching, research, and service obligations. Authorized private business
			 activities must be undertaken in accordance with the BGSU policy on consulting
			 and pursuant to formal consulting and conflict of interest management plans
			 signed by the faculty, the commercialization company and the university, and
			 approved by the department chair, the center director, the vice president for
			 research and economic engagement, the office of sponsored programs and
			 research and the general counsel.
(iii) Staff members may take approved leave
			 in order to engage in activities relating to a commercialization company during
			 regularly assigned working hours. When performed outside regularly assigned
			 working hours, these activities must be undertaken in accordance with
			 university policies and pursuant to a formal conflict of interest and conflict
			 of commitment agreement between the staff member, the commercialization
			 company, and the university. The department chair, the school or center
			 director, the dean and/or supervisor, and the office of sponsored programs and
			 research must approve such an agreement.
(iv) Staff members may pursue research
			 projects as authorized by their supervisors. Supervisors shall authorize only
			 those staff research projects that will advance the mission of the university
			 without regard to the financial interests of the individual
			 employees.
(f)
			 Conflict-of-interest management standards
(i)
			 BGSU facilities, equipment and other resources may not be used for research
			 benefiting a commercialization company except when such use is pursuant to a
			 sponsored research agreement, facilities use agreement or other appropriate
			 contractual arrangement.
(ii) As a
			 general rule, faculty, staff or students shall not hold management positions in
			 commercialization companies. While they may initially find it necessary to play
			 a management role in a newly formed company, it is expected that their
			 management responsibilities will decrease as the company develops. Professional
			 management should be brought in at the earliest opportunity. In order to ensure
			 the application of this principle, agreements between BGSU and a
			 commercialization company should contain enforceable milestones for the
			 reduction of these management responsibilities. Failure to comply with these
			 agreed-upon milestones will result in the company's inability to engage in
			 sponsored research with BGSU, utilize BGSU faculty, staff or student employees
			 and the other commercialization agreements and/or activities permitted under
			 these guidelines.
(iii) Faculty
			 members engaged in approved private business activities who find they are
			 unable to perform all of their regular university responsibilities shall
			 request a reduction of appointment or other approved leave subject to the
			 restrictions found in section
			 3345.28 of the Revised
			 Code.
(iv) Staff members who are
			 unable to perform all of their university duties because of activities in
			 connection with commercialization companies must reduce those activities or
			 request a reduction of appointment or other approved leave.
(v) Graduate and undergraduate students may
			 use university facilities, equipment, and other resources to perform research
			 benefiting a commercialization company only pursuant to a sponsored research
			 agreement or other formal agreement made with BGSU. Research leading to thesis
			 or dissertation may not be unreasonably restricted from publication or public
			 disclosure, as determined by the patent advisory and technology
			 commercialization oversight committee. Students should be informed in writing
			 of any restrictions that their involvement in research related to the company
			 may impose upon them (e.g. confidentiality requirements that may negatively
			 impact public disclosure of their research results) prior to the start of their
			 research. Faculty investigators should exercise care in involving students in
			 research that may impede completion of their academic program.
(vi) Students may be employed by a
			 commercialization company subject to limitations set forth in paragraph (G)(7)
			 of this policy. Prior to such employment, the student, the faculty or staff
			 member, the chair of the student's department and/or school or center director,
			 the chair of the graduate studies committee and a company representative must
			 sign an agreement disclosing the student's rights and obligations.
			 Such students may perform research benefiting a
			 commercialization company only pursuant to a sponsored research or other formal
			 internship agreement through the university.
(vii) A student may not be employed by a
			 commercialization company in which a faculty member has an ownership interest
			 if:
(a) The student is enrolled in a course
			 taught by the faculty member;
(b)
			 The faculty member is a member of the student's thesis or dissertation
			 committee; or
(c) The faculty
			 member is the student's advisor or the director of his or her thesis or
			 dissertation research.
(viii) Commercialization companies may not
			 enter into any agreements with the university for the purchase, sale or rental
			 of equipment, supplies or services other than those explicitly authorized by
			 the vice president for research and economic engagement
											on the advice of the patent.
(ix)
											As a general
			 rule, faculty and staff members who are not directly involved with research and
			 development of technology licensed to a commercialization company may hold
			 equity interests in that company. Equity ownership in these situations is
			 permissible only to the extent allowed by sections
			 2921.42 and
			 2921.43 of the Revised
			 Code.
(x)
											BGSU regulatory review boards including, for example,
			 the human subjects review board (HSRB) and the institutional animal care and
			 use committee (IACUC), may be utilized for research benefiting a technology
			 commercialization company only pursuant to a sponsored research agreement
			 between BGSU and the company, and then only for work performed in BGSU
			 facilities by BGSU faculty, staff and students.
(xi)
											As a general
			 rule, an individual faculty or staff member or their immediate family should
			 not hold more than twenty-five percent of the outstanding equity in a
			 commercialization company on an ongoing basis. Under circumstances where family
			 ownership exceeds twenty-five percent but does not interfere with the
			 employee's obligation to BGSU and does not create an additional
			 conflict-of-interest, this ownership provision limit may be considered and
			 amended by the vice president for research and economic development. While
			 significant faculty or staff equity ownership may be inherent in a newly formed
			 company, it is expected that their ownership interests, as a percentage of the
			 total outstanding shares or membership interests of the company, will decrease
			 as the company develops and attracts additional equity. In order to ensure the
			 observance of this principle, agreements between the university and
			 commercialization companies should contain enforceable milestones for the
			 dilution of these equity interests. Failure to comply with these agreed-upon
			 milestones will result in the company's inability to engage in sponsored
			 research with BGSU, utilize BGSU faculty, staff or students, and the other
			 commercialization agreements and/or activities allowed for under this
			 policy.
(xii)
											Faculty or staff members may not assume the role of
			 principal investigator/project director in sponsored research projects awarded
			 to BGSU and funded by commercialization companies in which they have an
			 interest if the projects involved the use of human subjects. Faculty or staff
			 members may assume the role of principal investigator/project director for
			 sponsored research projects funded by commercialization companies in which they
			 have an interest if a formal research integrity, conflict of interest
			 management plan approved by the patent advisory and technology
			 commercialization oversight committee and the vice president for research and
			 economic development is in place.
(xiii)
											Agreements for
			 sponsored research projects funded by companies must include, at a minimum, a
			 requirement for full BGSU publication rights, BGSU rights to own or use data,
			 and payment of fully negotiated facilities and administrative fees at the
			 on-campus research rate assigned by the U.S. department of health and human
			 services. The office of sponsored programs and research must approve any
			 exceptions to these conditions.
(xiv)
											Faculty, staff
			 and students participating in commercialization companies approved pursuant to
			 this chapter continue to be bound by all BGSU policies regarding the
			 development and ownership of intellectual property. New inventions and/or
			 discoveries made as a result of research efforts of BGSU faculty, staff and
			 students for the company, including those made under formal consulting
			 agreements through the institution, will be owned by BGSU. The company will be
			 offered an exclusive option to license the technology. If it is in the best
			 interests of the institution, the president has the authority under section
			 3345.14 of the Revised Code and
			 Article 10 of the institution's patent policy, to sell, assign, convey or grant
			 ownership of intellectual property rights to companies. New inventions and/or
			 discoveries developed by the faculty, staff or student for the company must be
			 disclosed to the office of sponsored programs and research as required by the
			 university patent policy.