Confidentiality agreement Peter J. Dolce, Ph.D. 24 Sep 1997 09:04 EST

One of our Pis has synthesized some compounds which he thinks may be
used to treat cancer.  The compounds are not patented or published; he
wants to shop them to a company which will test them to see whether the
company is interested in developing them.  The company has sent us a
confidential disclosure agreement which says that both parties--the
company and Meharry--agree not to disclose the information they
exchange, and that neither will attemt to commercialize it, its
derivatives or products without additional signed agreements concerning
research collaboration and rights.  Then the agreement says these
obligations will last for 5 years "unless either party informs the other
party that the confidential information and/or property is still secret
and confidential, in which case the [previous] obligations . . . shall
extend for a further period of 2 additional years."
 As I read this, once the PI discloses the information to the company,
he can't publish it or shop it to other firms for 5 to 7 years.  Also,
the PI believes the "unless either party informs" clause means that
either party can TERMINATE the agreement after 5 years.  I understand
the purpose of the clause to be just the opposite: the company can
extend the agreement for another 2 years, even if Meharry doesn't want
to.
 I've sent the agreement to our attorney; meanwhile, it seems me the
pitfalls for Meharry and the PI are that 5 years is too long a time, and
that the extension clause may extend this to 7 years with a simple note
from the company.   Also, the phrase "its derivatives or products" is
too broad for so long an agreement.  Would be grateful for any comments.
--
Peter J. Dolce, Ph.D., Director
Office of Research Support Services
Meharry Medical College
Nashville, TN  37208
P (615) 327 6703
F (615) 327 6738