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The Arizona Choice

Open for business. Experts in research.

A faster pathway to collaboration with greater intellectual property clarity.

Arizona Choice was created in response to industry feedback requesting more clarity on potential licensing terms of intellectual property (IP) developed under sponsored projects. This program is designed to expedite sponsored research agreements while, by offering straightforward IP terms, simultaneously providing increased certainty regarding resulting intellectual property.

Under traditional industry-sponsored research projects, sponsors receive a non-exclusive, royaltyfree, research-only license to resulting IP, along with an option to negotiate a commercial license at the conclusion of the project. While this model works well in many circumstances, especially when IP outcomes are less certain, it provides less IP certainty to the industry sponsor. The Arizona Choice provides additional options with varying costs and related IP certainty.

Industry-sponsored Research Options

 DescriptionCostAdvantages
Standard Research AgreementInternal non-exclusive, non-commercial research license without right to sublicense. Sponsor receives an option period to negotiate a commercial (non-exclusive or exclusive) license.No up-front costs. Commercial terms to be negotiated if desired.
  • No upfront fee
  • No need for pre-negotiation of license terms for IP that may/may not be developed
AZ Choice 1: Non-Exclusive Commercial LicenseMinimal financial terms for a nonexclusive, commercial license to project IP, without sublicensing rights.10% of the total project cost or $10,000, whichever is greater, due at beginning of research. No ongoing royalties. Sponsor agrees to cover costs related to protecting the IP. Sponsor receives a time-limited option to negotiate terms for exclusivity.
  • Known investment
  • No diligence terms
  • No required reporting
  • Reduced IP uncertainty

AZ Choice 2: Exclusive Commercial License

Up-front financial terms for an exclusive license to project IP, including right to sublicense. Reduced diligence and reporting requirements.25% of the total project cost or $25,000, whichever is greater, plus 1% royalty on total net sales exceeding $10 million. Sponsor agrees to cover costs related to protecting the IP.
  • Known investment
  • Predefined financial terms
  • IP certainty
  • Minimal reporting

Service / Testing

No expected IP, generally a service contract or testing of sponsor IP.No up-front IP costs, sponsor covers any costs related to protecting IP.
  • Generated IP, if any, assigned to sponsor upon request.

Important Considerations

  • The principal investigator and the University must agree in writing to accept the terms of AZ Choice 1 and 2. 
  • In some circumstances, IRS regulations may prevent AZ Choice 1 or 2 from being available. 
  • The industry sponsor must select and pay for AZ Choice 1 or 2 in advance, and such fees are non-refundable.
  • Sponsor will pay all costs related to protection (e.g., patents) of licensed IP. 
  • Service/Testing agreements are limited circumstances and only upon agreement of U of A administration.
Office of Research & Partnerships logo

Contact the Office of Research Contracts & Agreements for details. 

Please direct Inquiries to contracting@arizona.edu.