After completing a PhD in molecular microbiology and almost 15 years in the pharmaceutical industry including project managing Phase II and Phase III global clinical trials for pharmaceutical clients at IQVIA, I re-trained and qualified as an IP lawyer.
My career change occurred after a conversation with an IP lawyer. They told me that an understanding of scientific principles alongside clinical development was really important to enable effective translation of the underlying science into legal agreements. With my scientific and clinical research experience I would be ideally placed to advise life sciences clients, if I changed my career. It was a tough transition from project manager and scientist to lawyer, but the career change has definitely been worth it.
The challenges for founders of life sciences spin-out and start-up companies
For founders of spin-out or start-up companies the career change is of an even greater magnitude than mine. Founders will probably have spent at least 10 to 15 years working in academia and then suddenly, rather than focusing on the science, when the spin-out completes and the initial investment has landed, they are catapulted into running a company and the career change begins.
There are a myriad of different aspects to setting up and running a new company particularly in the life sciences sector. All have to be managed for the company to be successful and in most start-ups, there are only a handful of people to do the work.
As an IP and commercial lawyer, my role is to support the founders and flag the most important issues to look out for when a new life sciences company is entering into legal agreements especially relating to IP.
Protecting your most valuable asset
The IP owned by a new life sciences company will be its most valuable asset and needs to be protected. Such companies are likely to embark on collaboration or co-development projects either with industry or academia or both. In these projects, it is vital for the company to ensure that it has the right to own IP that it generates or that arises from the collaboration that is related to its technology and that it has full rights to commercialise that IP, including access to any background IP of other parties. These collaborations can be incredibly complex legal agreements and the IP position is crucial to ensure that the IP in the company’s technology is not in any way diluted or contaminated by the project and the company remains free to commercialise.
Managing your research agreements
The other common agreements for a new life sciences company are contract research agreements to assist with the development of the company’s technology. Agreements with CROs for research support such as preclinical studies or assay development must ensure that the IP that arises, and data and results generated related to the technology, are always owned by the company. It is surprising that many CRO standard terms and conditions do not, as an automatic position, assign all IP generated to the company that is paying for this work. However, these companies do not often resist a change in that position when the issue is flagged, if it is identified at the time.
Preparing for future funding and due diligence
A consistent position on ownership and access to IP is important as all of these contracts will form the basis of due diligence for any future fund raising which is a crucial part of a life sciences company’s development. Investors will want assurance that IP ownership is clear and well defined, and all of the legal agreements are consistent in that regard. Simple practical steps such as setting up an internal file management system to ensure that all contracts are in one easy to access system will help immensely with due diligence on future funding rounds.
This brief overview of the contractual IP issues important for a start-up company represents only a small, but important, aspect of running a new company. It is clear for success in this IP heavy area, that external assistance is needed to build a team with specific expertise to support the growth of the company and that includes a requirement for legal support. Mistakes in this area can be costly and wholly avoidable with the right advice.
Secure the right legal advice early in your journey
A founder’s career change will include a lot of new skills, but it does not have to include becoming a legal expert, as long as you work with ones that have expertise in the sector.
At Penningtons Manches Cooper, we have a dedicated Life Sciences sector group across our Oxford, Cambridge, London and Birmingham offices specialising in supporting innovative life sciences clients with IP, commercial, corporate and real estate advice. My appointment to our Birmingham office for the firm strengthens and extends the capacity of the Life Sciences sector team to support clients with the specialist support that they need by understanding their business, their technology at all stages of their development journey.
If you’d like to speak to Lisa about any of the issues raised in this article, or would like to chat about your own journey as a founder of a start-up or spin-out you can contact Lisa on lisa.page@penningtonslaw.com. Alternatively please visit our web page at https://www.penningtonslaw.com/expertise/sectors-solicitors-life-sciences