Research Institution/business collaborations
Example 10: Medico PLC & The Hippocrates Trust
Medico PLC has joint projects with a medical charity, The Hippocrates Trust. On one particular project some work has been done in each laboratory, with researchers Dr. Jekyll and Mr. Hyde, employed by the Hippocrates Trust and PLC respectively, working alone and together. Hippocrates Trust and PLC jointly own IP, but only Hippocrates Trust has a policy of IP sharing with its researchers.
When research progresses sufficiently to set up a spin-out company, this is done by the Hippocrates Trust, which transfers its IP into it. 10 of the 100 x £1 ordinary shares are given to its chief researcher, Dr. Jekyll, as an incentive to further development. PLC then takes 50 of the shares as well. Mr. Hyde is remunerated via Medico’s annual bonus scheme.
Dr. Jekyll is eligible for the Chapter 4A relief provided that he acquires his shares and Hippocrates Trust transfers its IP before PLC does. Mr. Hyde will not be eligible for any relief at all as he does not have a right or opportunity to acquire shares by reason of employment with the spin-out company or with Hippocrates Trust.