Why Compliance Is Important to Us

Becky Hernandez
Director, AUTM Board 
Director for Operations, Patents and Compliance
Caltech





Much of the technology transfer accomplished by AUTM Members is based on the licensing of inventions, software, and associated intellectual property (IP) arising from scientific research performed at universities, hospitals, and other non-profit research institutions. In the United States, a significant portion of this research is funded by federal agencies such as the National Institutes of Health {NIH), National Science Foundation (NSF), Department of Energy (DOE), Department of Defense (DOD), and NASA. This funding comes with certain obligations. Federal funding agencies need to show that they are spending taxpayers’ dollars responsibly. Accordingly, federal funding is highly regulated, and recipients of such funding are subject to a variety of reporting and other requirements, collectively referred to as “compliance.”
 
Most U.S. technology transfer offices (TTOs) have at least one full-time employee dedicated to federal (and other) compliance. However, a successful compliance program is a team effort, requiring the participation of not just the compliance administrator(s), but also licensing associates, finance and operations staff, and database managers, in the TTO; the support of the TTO director, who needs to resource and champion compliance activities; and the cooperation of personnel outside of the TTO, such as members of the research administration or sponsored programs office, and the researchers themselves.
 
Why comply?

First of all, it’s the law. Reporting platforms such as iEdison help the compliance process for funding recipients, while also allowing agencies to more easily identify missing, incorrect, or otherwise noncompliant information. Federal agencies may withhold funding from institutions with a history of compliance problems; no TTO wants to find itself in the position of having to explain such a scenario to senior administration.

Second, compliance is also critical to preserving an institution’s rights, under the Bayh-Dole Act of 1980, to elect title to federally funded inventions and proceed with helping to bring them to market through technology transfer activities. A startup company and its investors are less likely to take on the risks involved in the commercialization of university IP without assurance that the university holds clear title to what it is licensing.

Finally, compliance is an essential element of the good stewardship of taxpayer funds. It provides funding agencies with evidence of the tangible impact of their grant and contracting activity, which can be reported back to Congress and the public, helping ensure ongoing support for the federal sponsorship of research.
 
AUTM provides a range of resources to Members interested in making sure their institutions are in compliance with federal funding regulations. The Operations & Compliance course at AUTM University brings in expert instructors and federal agency officials to train TTO staff on Bayh-Dole regulations, use of iEdison, and other compliance topics. Participants also learn from each other by sharing their experiences and hard-won expertise. And the conversations continue in the Compliance SIG eGroup online community. AUTM’s advocacy efforts also help shape and clarify new developments in compliance requirements, such as Executive Order 14104 (Federal Research and Development in Support of Domestic Manufacturing and United States Jobs) issued in 2023.

Like so many other operations functions, compliance makes headlines only when it goes wrong. However, it is a crucial element of tech transfer, underpinning our institutions’ ability to bring the benefits of federally-funded research to the taxpaying public through licensing and commercialization. Whether or not your job title includes the word “compliance,” the success of your technology transfer activity is likely dependent in some way on the successful execution of federal compliance.