Scope: Research means the analysis of data for purpose of providing insight into existing or future business opportunities. Contract research organizations (“CRO’s”) specialize in technical research in pharmaceuticals and biopharmaceuticals. Similarly, “business intelligence” (“BI”) and “market analytics” organizations conduct statistical analysis and modeling of large data sets to identify commercial opportunities.
In research, two key business elements dictate the legal nature of the relationship. First, the research will create new intellectual property (“IP”), whether simply as a report or as a design for a new product. Allocation of the ownership of such intellectual property can be priced based on a work-for-hire (assignment) basis as “fees for services,” or as a joint venture for mutual exploitation, or as a license for royalties. Second, where the goal is to identify new opportunities, the risk of failure needs to be allocated as well. Accordingly, research agreements can vary as to type, risk-reward structure, IP ownership and termination rights.
Technical Requirements: Research services begin with data and human analysis. Typically, computer software is employed to identify trends, statistical anomalies and comparisons with benchmarks in the relevant industry.
Benefits: Outsourced research can accelerate speed to market, create new products or simply evaluate missed opportunities. Research services can be accompanied by prototyping and test marketing to mitigate the risks of failure.