Shepherd and Wedderburn LLP
  July 26, 2006 - Scotland

Bio-Device Partnering – Legal Issues
  by Joanna Boag-Thomson

Interdisciplinary collaborations and partnering across the medical research and life sciences sectors are becoming increasingly common. Large corporations with good industry reputations and large research budgets are seeking to collaborate with smaller companies developing next-generation products. Equally, smaller companies are coming together to share complementary know-how and technologies and to work together in the global marketplace. With big pharma increasingly looking towards biotech and other life sciences companies to assist with product pipelines, collaboration has become something of a buzz word in the biotech and life sciences industries. The life sciences sector in Scotland has a strong focus on collaborations as a tried and tested way to leverage their spend on technology investment. Earlier this year, US pharmaceutical giant, Wyeth, decided to make a multi-million pound investment in the Scottish life sciences sector by participating in a collaboration with 4 Scottish Universities and NHS Boards. Scotland beat off competition from other countries to land this significant deal. The willingness of all the parties involved to work together played a large part in the decision. The project focuses on "translational medicine" – a new field which integrates the study of disease with the development of novel therapies and diagnostics. The global nature of this deal cannot be underestimated for Scotland, not simply in terms of investment but also in continuing to enhance Scotland's burgeoning reputation as a centre of excellence in the life sciences field. The Biotechnology and Life Sciences team at Shepherd and Wedderburn, headed by Partner, Joanna Boag-Thomson, played a key role in this £50 million funding package for groundbreaking research in translational medicine, providing practical and focussed legal advice on the structure of the deal as well as dealing with key issues which arose during negotiations. In collaborative projects, it is important that the legal team understands the nature and purpose of the deal so that the legal documentation can properly reflect this. Typically in collaborations the parties will have strong views about ownership of intellectual property and the interaction of a party's background intellectual property with the new intellectual property that will be created as a result of the collaboration. The legal team should also be able to facilitate discussions and drive forward agreement on how the parties intend to share the exploitation of results which are generated during a project. A well drafted collaboration agreement can give clarity on a number of important issues. As well as legal issues, it is important to ensure that agreements include provisions relating to project management so that it is clear which party retains control, how the parties communicate with each other (and with the outside world), and how decisions are actually made. To avoid disputes escalating out of control, a resolution procedure can help the parties to settle disagreements in a way which is much less confrontational than resorting to arbitration or raising court proceedings. Termination can also be a contentious issue and, while it may seem pessimistic to focus on termination at the beginning of a promising relationship, dealing with worst case scenarios when the parties are enthusiastic about the prospect of working together can help the parties to focus on what outcomes are important to them. As collaborations, joint ventures and other partnering arrangements continue to increase across the life sciences sector both in Scotland and beyond, companies which are considering going down this route should take legal advice from experts in the life sciences field. Good legal advice can help negotiations to flow smoothly and produce a deal that reflects the aspirations of all of the parties.


Footnotes:
Joanna Boag-Thomson is head of Life Sciences with commercial law firm Shepherd and Wedderburn. +44(0)141-566 8570