Intellectual property management and commercialization of agricultural research: A case of MARDI
1. INTELLECTUAL PROPERTY (IP) MANAGEMENT AND
COMMERCIALIZATION OF AGRICULTURAL
RESEARCH:
A CASE OF MARDI
1
Tapsir Serin
Director of Strategic Planning and Innovation
Management Centre of
Malaysian Agricultural Research and
Development Institute (MARDI)
2. OVERVIEW OF MALAYSIAN AGRICULTURAL
RESEARCH INSTITUTE
2
Government
of Malaysia
Research Institute
MARDI
Malaysian Palm Oil Board
Malaysian Cocoa Board
Malaysian Rubber Board
Forestry Research Institute
Veterinary Research Institute
Fisheries Research Institute
Public Universities
Borneo’s Research Agencies
3. Conducting research in the areas of food
and agriculture
1
Development, promotion,
commercilization and transfer of
technology
Technopreneur Development
Competency development towards
progress in agriculture sector
2
3
4
MALAYSIAN AGRICULTURAL RESEARCH AND DEVELOPMENT INSTITUTE (MARDI)
4. OVERVIEW MARDI
Director General Office
Research & Development
Centers
Technology Transfer &
Commercialization Centers
Operation
Centers
Strategic Planning &
Innovation Management Centre
29 Regional Research Stations
4
5. OVERVIEW OF MALAYSIAN
PUBLIC AGRICULTURAL R&D SPENDING &
RESEARCH STAFFS LEVELS 2010
5
Table 1. Overview of Public Agricultural R&D Spending And Research Staff Levels, 2010
Type of agency
Total Spending Total Staffing
Malaysian Ringgit PPP Dollars Shares Number Shares
(million 2005 prices) (%) (FTEs) (%)
MARDI 183.0 105.5 26.3 578.0 35.9
Commodity boards (3) 304.3 175.5 43.7 305.0 19.0
Sabah and Sarawak (7) 28.9 16.7 4.2 109.4 6.8
Other government (9) 110.1 63.5 15.8 379.8 23.6
Subtotal government (20) 626.3 361.2 90.0 1,372.2 85.3
Higher education (13) 69.4 40.0 10.0 237.3 14.7
Total (33) 695.6 401.2 100 1,609.4 100
Sources: Calculated by authors from ASTI–MARDI 2011–12; Stads, Tawang, and Beintema 2005; and
Universiti Malaysia Sarawak 2012.
Notes: Figures in parentheses indicate the number of agencies in each category.
Data exclude degree-qualified technicians lacking official researcher status.
6. MALAYSIAN IP POLICY
Purpose • IP as a new engine of growth for the nation.
• Fosters the creation, protection, enforcement, management and maximum exploitation of IP.
Objectives • Strengthening IP administration of IP Corporation of Malaysia (MyIPO).
• Promotion of IP generated and commercial exploitation activities.
Activities
• Managing R&D innovations.
• Provide incentives, grants, enforcement and dispute settlement.
• Facilitate commercial exploitation by suitable valuation methods, contractual and licensing
rules.
• Development of proficient IP management capabilities covering the whole IP chain activities
from creation to protection.
• Good infrastructures for IP transaction.
• Protection of National IP interest and promotion foreign investment and technology transfer.6
7. MARDI’S IP MANAGEMENT
7
Director General Office
Strategic Planning and Innovation
Management Centre
Research and Innovation
Management Programme
Strategic Planning and Policy
Corporate Affairs Secretariat
Programme
MARDI first filed her IP in the Malaysian Intellectual Property Office (MyIPO) for an invention entitled
“Method of Producing Dietary Fibre Powder from Oil Palm Trunk and Function Food Thereof”
(22 April 1994 and obtained Patent no. MY 129137-A).
8. MARDI’S IP POLICY
OBJECTIVES
8
To protect MARDI’s integrity and interests
To promote, facilitate and encourage creativity and innovative capability among employees
To create a secure environment where original inventions/innovations can be protected
and rightfully owned
To provide the employees with fair and reasonable recognition, awards and incentives to encourage them to
develop new inventions/innovations
To encourage and develop the Institute’s growth, progress and success through active application of
research, development and commercialization activities
To facilitate and enhance the transfer of Institute inventions/innovations derived from research and the
dissemination of knowledge to the food and agriculture sector
9. MARDI’S IP OWNERSHIP
CHECK LIST
9
1 Created from a specific project funded by MARDI or funds obtained by MARDI.
√
2 Created from substantial use of its resources and/or services.
√
3 Created by employees during the course of study which is sponsored by MARDI.
√
4 Resulted from the use of pre-existing Intellectual Property owned by MARDI.
√
5 That forms part of Intellectual Property created by a team of employees and non-
employees. √
6 From any courses that are printed, videotaped or recorded using any other media and
may not be distributed without permission. √
10. MARDI’S TECHNOLOGY MANAGEMENT
PROCESS FLOW
(ISO 9001:2008)
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1. Declare generated technology to Technology Management Committee (TMC).
3. TMC will recognise the generation of the technology
2. Technology assessment report by experts to TMC on the novelty, patentability,
market potential, market feasibility, technology viability and commercialization mode.
5. TMC give judgment on the commercial strategies and approach.
4. TMC will give endorsement on IPR protection whichever necessary
12. Statistic
R&D&C
Outcome
2005-2013
i • Technology licensing -66
• Licensed Company-47
• Consultation – 7
• Active licensed projects– 32
• Technology in Negotiation – 11
ii
• MARDI IP Policy- 50:50
• Quantity IP – 198
• Licensing Fee, Management Fee
Royalty- RM 4.3 Mill.
• Estimeted Technologies Value–
RM 41.6 Mill
13. MARDI’S TECHNOLOGY COMMERCIALIZATION
CHECK LIST
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1 Does the technology offer a cheaper and/or a better way of accomplishing something?
√
2 Are there competing technologies available and if so how much better is the invention?
√
3 Does the invention provide a technological answer to an existing problem?
√
4 Does it have the potential for creating a new market?
√
5 How much investment, in terms of both time and money, will be required to bring the
invention to the marketplace? √
6 Will the inventors continue to work on the invention?
√
7 What will be the potential pay-off for a company that makes an investment in the
development of the invention? √
14. MARDI’S TECHNOLOGY
COMMERCIALIZATION MANAGEMENT
14
• Commercialization of MARDI’s technology is managed by the Evaluation and Upscalling
Programme under the Centre of Promotion and Business Development.
• The technology commercialization is guided under MARDI Commercialization Policy to ensure
that the rules and procedures are being followed.
• The flow of commercialization will start from an ideation stage until the determination of
commercialization mode.
• The ideas invented from MARDI’s pool of experts in relevant fields will have to pass several
development stages in order to successfully transform into innovation.
• This innovation has taken into consideration the needs of pre commercialization,
commercialization or public good.
• Commercialization of MARDI’s technologies are through licensing, consultation, outright sales
and arrangement of contract manufacturing (OEM).
• The majority of commercialization mode (more than 80%) is through licensing which is the key
drivers in MARDI’s commercialization success.
15. MARDI’S COMMERCIALIZATION
PROCESS FLOW
15
• Step 1. Technology package evaluation including evaluation of viability, feasibility and current
market accesability.
• Step 2. Technology promotion to enhance ”technology in offer" and to find the potential
partners by business matching, forum, exhibition and business talk
• Step 3: Potential investors or partners will submit the letter of intent (LOI) with several screening
criteria such as the company status, financial capability, the availability of the
interested technology and the company expertise.
• Step 4: Preparation of term of business and Non-Disclosure Aggreement (NDA).
• Step 5: Preparation of Technology Licensing Agreement based on the agreeable licensing terms
and conditions including specific technology Intellectual Property Right (IP).
• Step 6: Upon agreeable by both parties, the Technology Licensing Agreement which includes
the agreeable royalty fees and management fees is due for signing to complete the
licensing process.
• Step 7: Scheduled monitoring of commercialization status and progress is conducted to identify
any arising issues and challenges faced by the commercial partner.
16. MARDI’S TECHNOLOGY COMMERCIALIZATION
IMPACT
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From 2005 to mid-2015, a total of 85 technologies were commercialized involving 47
companies and 66 licensees. The value of technology involved is worth RM 42.6 million. A
total of RM 6 million has been collected in the form of royalties. Examples of technologies
commercialized as in Table 2.
Technologies generated Beneficiary/ Commercial partners
1 Rice varieties: MR 219, MR 253, MR 263, MR 269, MARDI
284
Rice farmers, Rice Regional Authorities
2 Rice clear field system: MR 220CL1 and MR 220CL2 BASF International, Farmers
3 Rice Foundation Seed 12 rice seed producers
4 Specialty Rice Varieties: MARDI Wangi 74 and 76 5 anchor companies
5 Exotica papaya Exotic Star and Far East Company
6 Josapine pineapple South Fruit Sdn Bhd
7 Minimal processing of Jackfruit and Durian Libro Agro Sdn Bhd and others
8 Starfruit under netted structure Sri Balakong Sdn Bhd
9 Growpine Fertilizer for Pineapple PK Fertilizers Sdn Bhd
10 Omega 3 Eggs LTK Bhd
11 Nitrohumic Acid CCM Fertilizers Sdn Bhd
12 New Modified Virgin Coconut Oil (MVCO) EVCO Sdn Bhd
13 Tiger Milk Mushroom Ligno Biotech Sdn Bhd
14 Salmonella Detection Kit (MicroTez) OPHC Holdings Sdn Bhd
17. MARDI’S TECHNOLOGY COMMERCIALIZATION
ISSUES AND CHALLENGES
17
• Lack awareness and understanding of the importance of intellectual property rights (IPRs).
Researchers are missing out, failing to commercialize their own ideas and sometimes failing to
prevent others unfairly exploiting their research
• In the joint venture research scenario, contract negotiation arrangement and intellectual property
ownership are the biggest drawback.
• In technology licensing , negotiations between parties are very important in ensuring successful
transactions.
• Research organizations frequently lack the skills in negotiating with potential users and business
counterparts which contribute to the failure of exploiting the full potential of IP commercialization
• Insufficiency of experience and knowledge in managing IP for the organization.
• The absence of a dedicated department or body, technology office (TTO) or technology
commercialization office (TCO),
• Lack of funding for IP filing and maintenance especially for international applications. Patent
applications are costly, and more so for international applications
• Lack of competent workforce on authority and enforcement portfolio, especially IP judge and expert
witness..
18. MARDI’S TECHNOLOGY COMMERCIALIZATION
WAY FORWARD & CONCLUSION
18
• Concerns about agriculture investment, return to investment, IP generation and commercialization of
research is rising.
• Commercializing IP is about getting products or services into the market place. Commercialization strategy
depends on many variables such as individual circumstances, business capabilities, competitive environment
and access to finance.
• Licensing is the most common commercialization method, but it is just one of many options for taking IPs to
the market place..
• MARDI is planning to establish Technology Commercialization Office (TCO)
• Combining the current IP Management Unit in Research and Innovation Management Programme with the
Evaluation and Up-scaling Programme as a one-stop center to manage IP and commercialization activities.
• By embarking on this step would mean more efficient and effective protection and management of IPs,
partners for licensing, partners for supporting research contracts and funding as well as support new
technology-based spin-offs.
• It would further enhance and strengthen the key success elements such as technology internationalization
and prototype support as well as active support for IP protection.