The correct implementation of the Intellectual Property (IP) Rights from Publicly Financed Research and Development Act, No 51 of 2008, effective August 2, is a critical step in ensuring its success.

The Act, which impacts on many South African universities, institutions and research councils, as well as funding entities, is a very difficult and complex concept to translate into a practi- cal system that could effectively work in this country, says law firm Adams & Adams senior consultant Esmé du Plessis.

“Legislation cannot be implemented unless it has the necessary framework of regulations to put it into effect. Challenges are encountered with an act or statute implemented without first enabling the regulations. With the Act, a wide consultation process was required,” she says.

The Importance of a National Intellectual Property Management Office
A National Intellectual Property Management Office (Nipmo) is currently being estab- lished within the Department of Science and Technology to promote the aims of the Act, including the protection, manage- ment and commercialisation of IP.

Du Plessis says that technology transfer offices need to be set up, within 12 months of the Act coming into effect, to undertake the new obligations and added responsibilities that a university or institution will take on as a result of the Act. Such respons-ibilities include the implement-ation of policies, as well as the disclosure, identification, protection, development, commercialisation and benefit-sharing arrangements of the IP, she says.

An important factor is also the staffing of Nipmo, says Adams & Adams chairperson Dario Tanziani. “There is an urgent need to employ the right number of people with the correct expertise to enable competent decision-making within each office.”

Impacting Factors
The Act will, possibly, have a great impact on what people do in the areas of scientific research and the commercialisation of the outcome of the research.

“There will be an impact on the operations of the institutions and universities that receive public funding to do research. Owing to the way that the Act is structured and the need to regulate the ownership of IP, institutions will need to take account of what research is done, document each step, what the results are and where the ownership vests,” he says.

Another concern from repre-sentatives of the universities is that this could hinder the revenue stream from contract research work, which goes into an institution’s research to fund further research and new equipment.

Tanziani does not believe that this Act will drastically hinder potential funding. A system has been developed to ensure that, should a private funder want the ownership of the IP, it would need to pay a certain amount and, built into that amount, is a profit factor for the institution, which they could use to buy new equipment or whatever is required.

The Funders’ Impact
Private funders contract institutions to undertake research and need to be informed of the progress of a particular project and who will be responsible for the IP.

Tanziani says that a difficult aspect is to determine the full cost of funding in situations where the infrastructure is already publicly funded. A formula for the different disciplines needs to be established to determine the percentages of the overheads and running costs of a laboratory, as well as indirectly related expenses, to which the research materials are then added.

Justification
There has been concern that the outcomes of important research work is lost or published before being patented, and that it may never be commercialised to extract its full benefit, says Du Plessis.

A system needed to be established to ensure that, where public funding is used for research, the findings will eventually be commercialised to the benefit of the people of South Africa.

Du Plessis says that the idea was to control and exploit the commercial potential of any valu
able patentable material resulting from the research, before it is lost or published, as, once published, the IP cannot be patented.

Positive Influences
The Act can have positive outcomes if used constructively and correctly, although it will constrain universities in the sense that they will have to do things in a certain structured way, she says.

Full-cost funding will probably be the route that larger private funders will go to ensure that the entity owns the IP. A coownership between the private entity and the institution may be a solution for private funders that are not financially strong enough for full funding, but which provide their own resources and background IP.

In this case, the research insti- tution could give a licence to the private funder for the commercialisation of the IP on an agreed basis.

“There are different ownership models that encourage private funders to fund research projects and make use of universities and researchers,” she says.

To put the Act into practice will take time, and it will take more time for people to understand what it will entail and what it might offer, says Tanziani.

“The societal aspect of this Act is emphasised. If research is undertaken with public money, it should be for the benefit of the public. It is really at the core of this whole Act,” he says.

The main aims of the Act are to ensure that any IP emanating from publicly financed research and development is identified, protected, used and commercialised for the social and economic benefit of the South African people.

It also aims to ensure that those receiving public funding act in a manner conducive to the public good and the furthering of such research.