How Do We Cover Costs?

The University (via TEC Edmonton) does not bill U of A researchers for its services. Instead, a portion of income generated by the technologies/companies we help bring to market is used to cover our costs.   

Patent prosecution can take several years and expenses may easily exceed $25,000 to $250,000.

How Do We Share Economic Benefits?

The University of Alberta invests considerable public funds in infrastructure and other research-related costs at the institution (i.e. labs, equipment, salaried position).  In return for these taxpayer-supported expenditures, the University receives a portion of income generated by technology created at the institution.  This portion of income is reinvested in research activity at the University (such as funding to the Faculty and Department where the research originated) after covering commercialization costs.

At the U of A, inventors have the choice of assigning the invention to the University or commercializing the invention through independent means.  Regardless of the route to commercialization, the University receives a portion of revenue. The value is determined by how much assistance TEC Edmonton provides to the commercialization process.

When a technology is assigned to the University, TEC Edmonton's Technology Transfer Program applies its full expertise and resources, and assumes the initial up-front costs of technology protection and marketing (which may include charges for provisional patent filing and legal services). 

Direct out-of-pocket expenses are recovered prior to disbursement of net revenue.

Distribution of Income

Net revenue received from commercialized technology is distributed as follows:

• 1/3 to the inventors;
• 1/3 to University to reinvest in research (including Faculties, Departments and Libraries); and 
• 1/3 to the “agent” who does the commercialization work: this can be either the University -- in cases where the technology is assigned to the University and TEC Edmonton helps commercialize, or the inventor -- in cases where the researcher pursues independent commercialization).

In cases where a Technology is Licensed to an external company, the distribution of income generally follows the formula above.

In cases where a Spin-off Company is formed, the income distribution involves an examination of the value added by the University when creating the company, as well as the viability of removing any income from a company in its early stages of development. For more details, visit the JumpStart section on Spin-off Costs and Revenue.

In 2002-03, revenue from licensing and royalties was distributed: