Surgeons are often on the front-line of innovation because our clinical background and hands-on use of medical devices allows us to clearly see the shortcomings of existing technology. Whether it is a stapler misfire, an awkward laparoscopic instrument, or a suboptimal bioprosthesis, as the “end-user,” the surgeon is often the first to recognize emerging problems with existing devices and identify areas of patient care that need improvement. Physician and surgeon innovators have pioneered the development of many successful products such as the central line, pulse oximetry, implantable pacemakers and defibrillators, balloon-tipped catheters, laparoscopic instruments, surgical staplers, coronary and endovascular stent grafts, orthopedic prosthetics, biological meshes, surgical retractors, and wound care devices, just to mention a few. Due to the technical nature of our work, surgeons also have a natural understanding of product need and design. It is no wonder that surgeons account for over one third of all medical device patents obtained annually by physicians in the United States.
The first step in commercializing your idea as a faculty member at a university is to submit an “invention disclosure,” sometimes called an “intellectual property disclosure.” This is a brief description of your idea or product in lay terms. There should be an “enabling description,” a description with specific details that would make this product potentially patentable. A sketch of the invention or a photo of a prototype if already developed would be helpful. A description of the potential market and potential licensees (i.e. companies that would want to license the product in exchange for a payment & royalties) should be included. You can use a Google search to identify market leaders in the medical device industry of your invention and determine the global market. The overall global medical device market is estimated at $350 billion, and depending on the proposed medical device, the market can ranges from under $100 million to over $4 billion. The disclosure is usually a 3-5 page document and is submitted to the university’s Office of Technology Transfer (also called “Office of Patents and Licensing” or “Office of Business Development”). Template forms are often available on your technology transfer office website.
Your office of technology transfer will provide a “patentability opinion” and “commercialization opinion” on your invention disclosure typically within 90 days. If your university believes your product can be patented and has commercial potential, it will file a “provisional patent application” on your behalf. If it does not believe the invention has potential, then the university will not file and will often give full ownership of the invention to the faculty member to develop on their own if they wish. While there is wide variability among different institutions, a university on average might receive 50-500 invention disclosures per year, and file for perhaps one half of those disclosures.
Filing a Patent
The first step in patenting process is to determine whether the idea meets 3 key patent criteria:
- Is the invention novel?
- Is the invention useful?
- Is the invention non-obvious?
Also, be aware that any “public disclosure” of your proprietary work may prevent patentability. Therefore, before presenting your hard-earned research data at a national meeting, consider whether there is any commercialization potential of your research and if so submit an invention disclosure prior to presentation.
Most university technology transfer offices will initially file a “provisional patent application” with the United States Patent and Trademark Office (USPTO). A provisional application includes an “enabling description,” often a drawing, and a date, but does not require formal “patent claims.” It allows for 12 months from the date of issue for the patent to be “converted” to a regular non-provisional patent. The cost is as little as $250-$3000. A USPTO patent (US only) requires specific “claims,” describing specifications in a legal format that clearly define the scope of protection of the patent. With legal fees, these patents often cost $10,000-$30,000. International patent protection provided for by the multinational Patent Cooperation Treaty (PCT), can become even more expensive.
Licensing the Patent
If a university chooses to file a provisional application for a faculty member’s invention disclosure, the office of technology transfer will then attempt to “market the patent” – to seek out companies in the appropriate industry to license the invention. Of note, there is a federal law, the Bayh-Dole Act, passed in 1980, that allows for researchers who are the recipients of NIH and other federal research funding to retain ownership of patents resulting from their research, but encourages those individuals and their university to move these patents towards commercialization in support of public interest. Therefore, it is in the University’s financial and often legal interest to help you commercialize your intellectual property (also called IP).
Typically, your technology transfer office will create a one page non-confidential product description and send it to companies that might be interested in your invention. As the inventor and a surgeon with knowledge of the companies with similar product lines, you can help identify companies that might want to license your product. The individuals to contact are often, vice presidents for new business development. Recognize that these individuals are often inundated with requests to license inventions. From experience, I can say that most companies are not interested in an “idea” but rather in a well-developed product with technical data and a large commercial market that is ripe for entry. Because of this problem, many physicians without the time or motivation to move their products along in this licensing phase will allow the provisional patent on their often great idea to go un-licensed, never to materialize.
Should a company express interest in licensing your product, the university will help negotiate the license agreement. This includes terms such as a “field of license” (i.e. you will grant a license to develop and market your device only for the purposes of vascular surgery or for use in vascular surgery, percutaneous coronary intervention, and neurointerventional radiology procedures) and exclusive vs. nonexclusive licenses. Upfront licensing fees, annual license maintenance fees, and royalties (i.e. a percentage of each item sold, should the product come to market) are often negotiated. Recognize that the further along you have developed your invention, the more lucrative the licensing agreement would be. For example, a company might provide much better terms to license a product that has a prototype and promising initial data rather than merely a sketch of a product.
In general, universities own the intellectual property of their faculty, but do provide for a revenue or profit sharing arrangements should an invention become commercialized. Recognize that only about 5% of patents make it to market and probably fewer earn much revenue. Typical university revenue sharing arrangements allow for a faculty member to retain 30% of the revenue, though these arrangements can differ substantially depending on the institution. Though this number may seem a bit low, recognize that your technology transfer office can help you significantly in the early stages of product development, will typically pay for patenting and legal fees, and can help you negotiate licensing terms.
Establishing a Start-up Company
For those with enthusiasm for their product, there is another option: seeking out angel investors and venture capital (VC) funding and establishing your own start-up company. Angel capital implies an individual or small group that will provide typically between $5,000 and $500,000 for ownership equity in the new company. Venture capital firms will typically provide $100,000 to tens of million dollars for ownership equity. Your office of technology transfer can help you with identifying angel investors and VC firms in your area to help start your company. A prototype of your product will need to be built with your initial investment. While much of medical device manufacturing is performed abroad, there are several American companies that specialize in prototyping and low volume manufacturing of medical device products. Companies that specialize in medical thermoplastics, biomaterials, metals, optics, along other industrial areas can help with the development of many surgeon-conceived medical devices. Other options for initial prototype development might include collaboration with basic scientists in your school’s biomedical engineering departments. These basic science faculty and their students are often eager to work with surgeons. We provide the ideas while they provide the technical expertise. Recognize that in discussing your invention with anyone at a company or another school, you should obtain a confidential disclosure agreement (CDA), also called a non-disclosure agreement (NDA). You can find a standard CDA on Google or on your technology transfer office’s website. Make sure it is a “two-way” CDA (i.e. protects the privacy of both what the company tells you and what you tell them).
Medical devices have regulatory concerns. There are three FDA classes of medical devices:
Class I devices have the least market control. These do not present any reasonable risk of illness or injury, and are generally exempt from what is called premarket notification (see below). Examples include Band-Aids and examinations gloves.
Class II devices involve more market control. These require special controls such as labeling requirements, need to meet established mandatory standards, and must provide postmarket surveillance. Examples include surgical drapes and surgical clamps.
Class III devices involve the most market control. These requires the submission of premarket notification (also called a 510k), a lengthy document reviewed by the FDA to ensure the device’s safety and efficacy. Examples include pacemakers and prosthetic joints. For products that require a 510K, legal assistance from law firms that specialize in medical device and FDA regulatory law is often needed. The processes often requires identifying a “predicate device” (an approved device that is similar), demonstrating that the device is “substantially equivalent” and for the “same intended use,” providing an enabling description with a comparison, providing extensive testing data (including so-called “biocompatibility testing”) to support the “performance claims.” The process can cost $25,000-$50,000in in legal fees and take 6 months. The FDA’s Division of Small Manufacturing, International, and Consumer Assistance (DSMICA) can also help with the process.
Surgical Innovation Programs
For those interested in commercializing medical technology, there are several universities that offer dedicated surgical innovation programs. Stanford University’s Department of Surgery offers a well- known 2 year surgical innovation fellowship program, pioneered by Chairman Dr. Thomas Krummel. This program is integrated with Stanford’s highly successful Biodesign biomedical technology innovation program. Similarly, Harvard Medical School, Massachusetts Institute of Technology, Boston University, and other Boston area institutions have established a consortium called the Center for Integration of Medicine and Innovative Technology (CIMIT). This center also offers fellowships and grants for surgeons interested in medical innovation. Rutgers University’s has a similar Center for Innovative Ventures of Emerging Technologies (CIVET) where members from research departments, including the department of biomedical engineering, collaborate with members of the Robert Wood Johnson Medical School’s Department of Surgery and other institutions within New Jersey to commercialize novel medical technologies. Similar innovation centers exist in the University of Cincinnati, Case Western Reserve, the University of Utah, to name just a few.