Industry Agreement Guidance and Policies
Find insight on Sponsored Research Agreements with Industry entities and see descriptions of policies related to industry agreements.
UC Office of the President's policies for working with industry can be found on the UCOP website.
Sponsored Research Agreements with Industry
Industry Sponsored Research Agreements
A sponsored research agreement with an industry partner is a contract between UC San Diego and an external, for-profit entity (Sponsor) that provides funding in support of, the performance of a single research project by UC San Diego's principal investigator(s). The terms and conditions of the sponsored research agreement are negotiated between the SPO and the Sponsor. Upon its execution by the authorized officials of the parties, the sponsored research agreement serves as the award document for the proposed research project.
Sponsored research agreements with industry Sponsor(s) memorialize the mutually agreed statement of work and budget, as well as the rights and obligations of each party, including, but not limited to publication, intellectual property, data rights, indemnification, payment of research costs, confidential information, export controls, and period of performance of the project.
Considerations for working with industry
One of the areas of UC San Diego’s sponsored research portfolio that has been growing in recent years is with industry sponsors such as those in the fields of pharmaceuticals, biotechnology and telecommunications. These business sectors seek to collaborate with the researchers and scientists of a world-class institution such as ours, with opportunities to share information about proprietary technologies and cutting-edge developments, and have the opportunity to be the first to access innovations that emerge out of that sponsorship.
However, working with industry can be complicated, and is different from academic partnerships or sponsorships by federal grants and other funding sources. Here are some insights into the types of issues to be aware of when our researchers and their support teams are preparing to work with a for-profit sponsor.
Negotiating Agreement Terms with Industry Sponsors
Academic research institutions and industry often have differing missions, cultures, priorities, and expectations. As a result, more protracted discussions and complex negotiations may arise requiring unique and individualized solutions the UC San Diego Sponsored Projects Office (SPO) and industry Sponsors, the SPO encourages researchers to submit a complete and accurate Kuali Research (KR) record when sponsorship is probable. For questions about sponsored research with industry Sponsors or help with KR record submission, please contact an SPO Contract Officer or SPO’s Information Desk at researchadmin@ucsd.edu.
Policies Affecting Agreements with Industry
Related Links
Principals Regarding Future Research Results
Publication
A fundamental principle of the University is to establish an open teaching and research environment so that ideas can be exchanged freely among faculty, students and for public benefit. The University's research activities are an integral part of the total educational program, and often form the basis for peer-reviewed scholarly articles, seminar reports, presentations at professional conferences, and student dissertations and theses. Therefore, the University will conduct research or studies only if the scientific results can be published or otherwise promptly disseminated. Copyrights and publication rights belong to the University and/or the author.
Patents and Other Intellectual Property
The University's intellectual property policies (PDF) aim to promote the progress of science and technology, to ensure that discoveries and inventions are used to benefit the public, to provide appropriate royalty revenues to the University and the inventor(s), and to support University research and education through invention-related income.
UC San Diego is a nonprofit, academic, public, state university supported by public funds. Therefore, inventions made by UC employees or using UC facilities are considered the property of the state of California and held in stewardship by the Regents of the University of California on behalf of the public. As such, any intellectual property made or developed by University employees or using University facilities in conducting a research project vests with the University. Funding by an industry Sponsor of University research does not give rise to the Sponsor’s ownership of the resulting intellectual property. The University may be able to grant to the industry Sponsor certain licensing rights to university-owned intellectual property.
To streamline licensing terms and obtain up front licenses under an industry-sponsored research agreement, companies are invited to review our Innovation Zone Program.
Preparing Budgets with Full Costs
When preparing and presenting proposed budgets to industry Sponsors, Principal Investigators must ensure that the budget applies the full indirect cost rate for industry-sponsored research agreements and industry-funded clinical trials. Draft and preliminary budgets that exclude the applicable indirect cost rates lead industry Sponsors to expect a lower overall cost. Such underfunded budgets may lead to reductions in direct costs, revisions to the scope of work for the anticipated research project, and/or delays in the execution of the agreement.
Payments
As a nonprofit public entity, the University is unable to work in arrears on privately funded projects. Rather, the University needs to ensure that it has received sufficient funds from the industry Sponsor in advance of incurring such expenses and obligations. Therefore, it is the University’s expectation that it will receive, at a minimum, an initial payment upon execution of an agreement. Industry-sponsored projects are performed on a "no-profit--no loss" basis.
Termination of Sponsored Research Agreement
In the event a sponsored research agreement is terminated by the industry Sponsor for any reason, the Sponsor will reimburse the University for all costs incurred to the date of termination and for all non-cancellable obligations. There is no return of payment to the Sponsor for fixed-priced deliverables.
Use of the University's Name
Liability, Risk, and Best Efforts
Since research by its nature is unpredictable and without guarantee of successful results, University research is conducted on a "best efforts" basis.
The University does not profit on its research. For this reason, and also because it is inconsistent with the best efforts principle, the University is unable to accept contract provisions that guarantee results, impose penalties for failure to make progress by firm deadlines, or provide for withholding of payment if the industry sponsor is not satisfied with the results.
The University may negotiate indemnification clauses appropriate for the project and agreement, in accordance with UCOP policies regarding indemnification. The University cannot accept 3rd party liability.
In certain clinical research projects, the industry sponsor may be requested to share or cover the medical costs of any human subject injured in the performance of the research.
Conflict of Interest (COI)
700-U: Statement of Economic Interests for Principal Investigators
The University has its own Conflict of Interest policies that conforms to applicable conflict of interest regulations, including but not limited to those set forth in by the Fair 3 Political Practices Commission (FPPC) under the State of California. Refer to the University’s policy on conflicts of interest which includes a description of the Principal Investigator’s responsibilities.
Agreements will not be signed until the COI office has determined that there is no conflict or that a conflict has been appropriately managed.Indirect Costs (IDC) for Industry
UC Policy on IDC
UC policy mandates that an industry sponsor must cover the full direct and indirect costs of the project. Please note that this policy applies even if the University is receiving the industry funds through a pass-through entity.
For-profit industry sponsors must be charged the full IDC rate applicable to the type of research or clinical trial listed on the UC San Diego Indirect Cost Rates table.
Why IDC Matters
Indirect costs are real costs incurred by the University to acquire and maintain its buildings and equipment, and to provide operational support. These support services include maintenance and operations (utilities, janitorial services, police services, etc.), library operations and administrative services. All of these costs are real, and without them, the University could not exist.
Full cost recovery is necessary to support the University’s physical and administrative capacity to perform research. When indirect costs are not fully recovered, maintaining the University’s research capabilities and infrastructure is compromised.
Since indirect costs are, in essence, actual costs, a reduction of indirect cost rates (or exempting certain costs) on funds received from for-profit organizations in support of research performed at the University are considered a gift of public funds (ex. federal or state funding) for private benefit, as the industry sponsor is not reimbursing the full cost of the project. Without full indirect cost recovery, the University is subsidizing the cost of the project for the sponsor; this is contrary to our public benefit principle and may jeopardize UCSD’s tax-exempt status.
Industry Funded Clinical Trials
Refer to the Clinical Trial guidance regarding the application of IDC for Industry Funded Clinical Trials.
Waiver of Indirect Costs for Industry Sponsors
Any exception to collecting full IDC from Industry Sponsors can only be approved by the Chancellor, after consultation with the Vice Chancellor for Research and the Assistant Vice Chancellor Contracts & Grants. As a general rule, the University expects for-profit sponsors to pay the full applicable indirect cost rate regardless of the for-profit sponsor’s own policy, as this ensures coverage of all applicable facilities and administrative costs borne by the University.
Industry Funded Fellowships, Scholars, and Educational Grants
Refer to Policies on Industry sponsored fellowships, scholars and educations grants, including indirect costs.
For more information or questions email researchadmin@ucsd.edu.