What is an MTA?
Material Transfer Agreements (MTAs) are legal agreements that are entered into by a provider and a recipient of research material. Research material includes biological and non-biologic materials; plant and plant tissues; hazardous, toxic or radioactive compounds; or equipment and prototypes for use in research, testing and/or evaluation.
The goal of a MTA is protect the rights of the provider and recipient while allowing research, analysis and evaluation to proceed unhindered. MTAs can protect the right of researchers to publish their results and participate in the financial rewards that result when a company takes the material or technology to the marketplace. MTAs also protect the provider and recipient and their respective organizations from misunderstandings and potential liability, and assure that the researchers adhered to Federal regulations regarding the transfer of materials developed with Federal funds.
The recipient of research materials is typically required to sign an agreement with the provider before the materials can be transferred. These agreements include terms and conditions regarding ownership of the material, including derivatives and modifications thereto, use of the material, including reproduction and replication, and intellectual property rights, publication rights, confidentiality of information, and indemnification and warranties. Because of the wide range of possible terms and conditions, negotiation with the provider is often necessary. The following sections summarize some of the considerations that are reviewed in using, modifying, or drafting an appropriate MTA.
Basic Transfer Scenarios
There are three
basic scenarios of material transfer that we're faced with as a University:
- Transfers between academic (not-for profit) institutions:
Researchers often get requests from their colleagues for samples of research material. Sometimes the source of funding (especially NIH or NSF) specifically requires that materials generated from funded research be made available to others. In such cases, MTAs are useful in order to allow the original researcher to keep track of the materials and prevent further transfer of material to other researchers. If a paper from another institution appears in a journal on the same research topic, a record of MTAs could be useful in establishing whether co-authorship is appropriate, or whether the research work was done independently. Without an MTA, a recipient of the research material could even license that material or its derivatives to a for-profit company without informing the provider or sharing royalties.
- Transfers from industry to academia:
Researchers often seek materials from industry for their research, and industrial firms almost always insist that such transfers be accompanied by a MTA signed by an authorized official of the University. Because a private company has substantial financial interests at stake, an industrial MTA usually carries more restrictions than its academic counterparts. Industrial sources will often ask for ownership of modified derivatives of the material (hence no inventor rights) and demand review and/or approval of all related publications. Most companies however, will negotiate such terms in exchange for the right of first negotiation to an exclusive, royalty-bearing license.
- Transfers from academia to industry:
University research materials are also transferred to industry for evaluation, screening, analysis, testing and further development. If the material is proprietary to the University, the MTA may include confidentiality provisions and future licensing provisions as a precursor to a license agreement. There may also be instances where non-proprietary material is provided to a company. In these instances, the University still needs to be protected against any liability incurred by the company in its use of the material.
University Concerns in MTAs
Defining the Material:
The actual research material to be transferred must be described in the MTA. Considerations include whether the material can be readily obtained elsewhere, whether the University is the only repository, and whether ownership is unclear. A unique material, on the other hand, may be hard to obtain or reproduce, may represent significant effort by the scientist, may have considerable value added by the University, or could involve large cost outlays by the University, and may have considerable public and commercial value. These factors assist in determining the nature of the terms in a MTA.
Uses of the Material:
How the original material transferred is to be used is another key element in the MTA. The material may be used only for screening, testing or evaluation without reproduction or replication. In other cases, the original material or parts thereof may be modified to produce a better material that may in turn involve reproduction and replication of the material. Finally, the objective may be to synthesize the original material or parts thereof. Defining and controlling the intended uses of the material is a critical element of the MTA.
Geographic Considerations:
Transfer of research material may be subject to interstate regulations regarding transport, handling and entry. Agricultural and hazardous materials as examples of materials that may require special consideration.
Transfer of research material to institutions or companies outside of the United States are tightly regulated by the U.S. Export Administration Act (EAA) and its Export Administration Regulations (EARs) and the U.S. Arms Export Control Act (AECA) and its International Traffic in Arms Regulations (ITARs). Parties not adhering to the EARs and ITARs can expect substantial monetary fines and jail time.
Other MTA Considerations:
In addition to the above considerations, history and reputation of the parties, publication, authorship, credits, and relationships between the researchers and other factors often play a role in defining the nature of a MTA.
MTAs attempt to cover situations that may arise from sharing products of research before conflicts arise. Cases abound where researchers find their ability to publish blocked because they unknowingly signed away their publication rights in a MTA in order to get their hands on the material (usually after saying, "I'm sure nothing will come of this research..."). In other cases, material is transferred to other researchers with no downstream credit coming to the original developer of the material. In the worst case, material is transferred to a company without specifying exact conditions of use, and the company takes the technology to the marketplace while leaving the inventor and the University with little in return. Each of these scenarios can be controlled through the diligent use of Material Transfer Agreements.
MTA Processes and Procedures
All Materials Transfer Agreements should be reviewed by OTTED. Authority to sign MTAs has been delegated exclusively to the Director of OTTED [University of Hawai’i Executive Policy-Administration E8.101: Authority to Execute Contractual Documents for University Inventions, Patents, Copyrights, and Technology Transfer, July 1998] by the President. Faculty, departmental chairpersons, deans, or directors do not have the authority to accept MTAs on behalf of the University. In fact, accepting such agreements without the proper authority may result in an assumption of substantial personal liability.
In summary, the process will typically follow the procedure below
To Transfer Proprietary Material to a For-Profit Company or a Researcher at Another Institution:
- Provider Scientist fills out University of Hawai’i Outgoing MTA and sends MTA (2 copies) to Recipient Organization for approval.
- OTTED and Recipient Organization negotiate alternate terms, if necessary.
- Recipient Organization and Recipient Scientist sign the MTA (2 copies) and return both copies to OTTED.
- OTTED Director signs and executes the MTA.
- OTTED sends an original to Recipient Organization and provides a copy to Provider Scientist.
- OTTED files original MTA in OTTED master file and sends copy of executed MTA to Recipient Scientist.
- Provider Scientist arranges for transfer of the requested material to Recipient.
To Transfer Material into the University:
- Recipient Scientist receives proposed MTA from Provider.
- Recipient Scientist submits proposed MTA to OTTED.
- OTTED reviews the MTA with Recipient Scientist and negotiates with Provider if required.
- OTTED Director and Recipient Scientist approve and sign MTA (2 copies).
- OTTED returns executed MTAs (2 copies) to Provider.
- Provider Scientist and Organization sign and return one (1) executed MTA to OTTED.
- OTTED files original MTA in OTTED master file and sends copy of executed MTA to Recipient Scientist.
- Recipient Scientist arranges for transfer of the requested material from Provider.
Without a doubt, MTAs are inconvenient, but so is a private company restricting or preventing publications, controlling the data resulting from research using their material, or including unlicensed or uncredited University materials in their products. With a little foresight, each of these problems can be avoided by appropriate Material Transfer Agreements.
Assistance with MTAs
Your OTTED representative is available to assist you in arranging for the transfer of research material into or out of the University:
Outgoing MTA Form
The following Microsoft Word form allows you to fill in the recipient organization and scientist, the description of the research material and the research project in which it's going to be used, and contact information.
If you will be sending proprietary materials to private companies or other researchers, you can use this agreement. Please follow these Procedures if you want to use this form.
If you will be sending non-proprietary materials to private companies or materials to colleagues at other academic institutions or non-profit research institutes, please contact your OTTED Representative for help.
Links and References
If you would like to learn more about MTAs, you may want to check out the following links to additional reference materials readily available on the web.
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