A licensing agreement is a strategic partnership agreement between the holder of intellectual property rights (the licensor) and the party granted permission to use those rights (the licensee) in return for a predetermined payment (a royalty or fee). There are three major types of Licensing Agreements:

•  Copyright Licensing Agreement – When the author/owner of the copyright in a work does not want to relinquish ownership, a license can be sought from the author. Such a license may allow the licensee to exploit the copyrighted work, either in whole or in part, in exchange for a one-time payment of royalties or periodic fees. The licensee can then commercially exploit the work in exchange for payment of royalties. The royalty amount may be determined by the licensee’s earnings and can be paid in any agreed-upon installments. Licenses may be granted for an entire jurisdiction or may be territorial in nature. Technology Licensing Agreement – This agreement outlines the conditions that the licensee must follow when using the technology granted by the licensor. It proves useful for firms that seek to utilize another entity’s patent or utility model protection for the purpose of launching new goods and services into the market, improving existing products or penetrating other market niches.
• Trademark Licensing and Franchising Agreement: Franchising is a strategy in which firms with exceptional brand images grant permission to other parties to manufacture and sell similar products under the brand name. This type of agreement is advantageous to both the trademark owner and the licensee concerned. The trademark owner can increase the market penetration for the particular brand, while the licensee benefits from the fact that the trademark is already well-recognized and valued in the market. It is necessary to maintain high-quality standards to protect the image of the trademark and prevent customer deception. A trademark franchise allows a successful brand owner to share expertise and resources with another firm (the franchisee) for direct provision of goods or services to the final consumer.
• Patent Licensing Agreement: Patent licensing involves a legal agreement which is signed between the patent owner and another party that intends to utilize the patent. Under this agreement, the licensee receives the right to use the patent and pays a licensing fee or other consideration. The licensee is also obliged to adhere to the terms and conditions stipulated in the agreement.

Usual provisions laid out in a patent licensing agreement include the scope of the licensing; the fee structure that the licensee must pay; the period that has been set aside for the agreement; and limitations on the use of the patented product. Some of the other terms of the agreement can be regarding confidentiality, protection of intellectual property, and issues related to the breach of agreement. Licensing agreements are common in various sectors such as the technology sector, pharmaceutical sector, and the manufacturing sector. It can be useful for patent holders to generate revenue without the need to produce or sell goods themselves. For licensees, it offers the opportunity to use valuable technology to develop other products and services.

In essence, licensing agreements are pivotal for IP holders to monetize their assets and for licensees to access and leverage valuable IP for business growth.

IIPRD is among the leading IP Firms based in the US and India, specializing in Licensing and Monetization Services. Our comprehensive approach includes identifying infringements, generating patent-to-product mappings, drafting claim charts and evidence of use opinions, and managing the entire patent licensing life cycle. We engage potential licensees, gauge interest, share confidential prototype information under Non-Disclosure Agreement/Confidential Disclosure Agreement NDA/CDA, and finalize term sheets and licensing agreements. Our expertise spans a wide range of IP assets, including trademarks and copyrights, as well as valuation, audit, and other monetization mandates.

IIPRD provides support throughout the licensing process of varied IP Assets including Trade Marks, Patents and Copyrights, along with providing support to the clients on valuation, audit, and other monetization mandates. Due to IIPRD’s strong and acute focus on IP Commercialization and Licensing Issues, the firm has been a part of numerous Out-Licensing deals, and currently undertakes over 20-30 complete out-licensing mandates a year. IIPRD provides comprehensive services, including conducting In-Licensing & Out-Licensing exercises. These services involve detailed technical and commercial evaluation of the technology, considering factors such as market potential of the technology, competing products, pricing strategies, potential licensees, along with evaluating strength of the patent, coverage and enforceability of the concerned patent. This thorough analysis can help in presenting the best-fit strategy to meet the client’s needs.

IIPRD, as mentioned above, has an active mandate of preparing a strong Patent/Technology value proposition presentation, and then reaching out to the key stakeholders in different potential entities to evaluate their interest, based on which further confidential information is shared over a NDA/CDA to firm their interest.

We provide an immediate and active marketplace benefiting both patent owners and interested licensees by representing clients in various mandates, including:

• Identifying IP/Patent Portfolios available for out-licensing/sale
• Evaluating the licensing potential of a Patent Portfolio
• Conducting Market Research to identify evidence of use and draft claim charts
• Performing Due Diligence on Potential Licensees
• Facilitating the Preparation of Marketing Collaterals for accurate technology representation
• Preparing Term Sheets, Licensing, and Sale Agreements
• Undertaking Valuation, Due Diligence, and Audit Exercises

IIPRD’s dedication to excellence and client-centric approach positions us as a trusted partner in the IP industry, driving value and growth through strategic IP management and commercialization.

At IIPRD, the firm follows five step process for IP Licensing / Patent Licensing / IP Monetization / IP Commercialization mandates (which is customized depending on client requirements):

• STEP I

A Memorandum of Understanding (MoU) is signed with the client or IP holder after professionals at IIPRD / K&K have reviewed the Technology, Intellectual Property (IP), and Patent in context and have examined any supporting data that is available, such as Clinical Results, Prototypes, and Proof of Concept.

• STEP II

IIPRD’s Licensing Professionals develop a thorough Technical Presentation of the Technology / IP / Patent at this point, expanding the facts and highlighting the primary technical value proposition for potential licensees to better understand the nuances and the intricacies involved in the entire process.

• STEP III

After preparing and finalizing the technical presentation, IIPRD’s professionals pitch the technology to Chief Technology Officers (CTOs), Research and Development (R&D) heads, and business development heads of various potential licensees relevant to the technology’s context (through email, social media platforms, referrals, telephonic-personal meetings), to ascertain their interest and gather feedback on the proposed technology. The team then follows up with them regularly over the course of three to six months.

• STEP IV

After receiving a potential licensee’s interest confirmation (based on evaluation of confidential/experimental/proof-of-concept data over a CDA), IIPRD prepares a draft term sheet based on internal evaluation of the technology. Valuation is a specific and separate billable activity entirely up to the client’s decision. The potential licensee thereafter undertakes negotiation on the proposed draft term sheet with the Client/Patentee to finalize the terms and conditions of license and/or sale of the technology.

• STEP V

After completing the term sheet, IIPRD prepares a licensing agreement (as a separate billable exercise) to facilitate execution of those above licensing or sale agreements. At that point, IIPRD charges the mutually agreed-upon success fee based on the quantum of the transaction.