Mergers & Acquisitions
Cooperations & Licensing

Licensing

A license may be granted by a party ("licensor") to another party ("licensee") as an element of an agreement between those parties. A shorthand definition of a license is "an authorization to use the licensed material". It allows third parties to use proprietary rights or intellectual property (patents, utility models, registered trademarks) under defined conditions. In healthcare trademark and brand licensing are very common. Licensing plays a crucial role in the healthcare sector, particularly in the fields of medical technology, medical devices, pharmaceuticals, biotechnology, and healthcare IT. Licenses are also granted for the use of know-how or software. And a licensor may grant permission to a licensee to distribute products under a trademark.

The most common terms are, that a license is only applicable for a particular geographic region, just for a certain period of time or barely for a stage in the value chain. Moreover there are different types of fees within the trademark and brand licensing. The first form demands a fee independent of sales and profits, the second type of license fee is dependent on the productivity of the licensee.

Licensing agreements can grant either non-exclusive or exclusive rights. Key elements of a licensing agreement include the description of the licensed subject matter, the definition of the market segment or region authorized for use, the term, the fee structure, and, if applicable, penalties for breach of contract. The fee is often structured as an initial down payment followed by ongoing royalties based on the economic success or utility of the licensed product.

ConAlliance possesses detailed experience and expertise in negotiating licensing agreements and can assist you in maximizing the value of your product while ensuring you retain control over your product rights.

More Information on Patent and Technology Transactions

Joint Ventures and Strategic Alliances

Entering new markets can often only be achieved initially through partnerships. The most common forms of business partnerships are joint ventures and strategic alliances.

A joint venture is a business agreement in which the parties agree to develop, for a finite time, a new entity and new assets by contributing equity. They exercise control over the enterprise and consequently share revenues, expenses and assets. In emerging countries, ahead in China and India, a joint venture is the most common form for a foreign enterprise to enter the market. Within joint ventures, there is a distinction between equity joint ventures and contractual joint ventures. In an equity joint venture, the partner companies act as shareholders of a legally independent entity that forms the corporate unit. Alternatively, a management contract within the framework of horizontal cooperation can also be a viable option.

A strategic alliance is one of the most common forms of cooperation between two or more parties to pursue a set of agreed upon objectives need while remaining independent organizations. Partners may provide the strategic alliance with resources such as products, distribution channels, manufacturing capability, project funding, capital equipment, knowledge, expertise, or intellectual property. The alliance often involves technology transfer (access to knowledge and expertise), economic specialization and shared expenses. Acquirers are looking for strategic alliances over acquisitions to share the risk.

Motives for cooperation and partnerships include potential benefits of complex learning between organizations, risk reduction—especially when entering new international markets—and the integration of economic and political contacts as well as specific market knowledge.

The typical approach involves an initial strategic analysis focusing on the potential for cooperation and value enhancement, as well as assessing opportunities and risks. Following this, a partner profile and fit analysis is conducted, examining fundamental, strategic, and cultural compatibility. Once this phase is complete, the joint venture configuration takes place, including defining the field of cooperation, determining the intensity of interconnection, and pre-contractual and contractual steps. Furthermore, the management of the joint venture is planned in advance, and its coordination and governance are prepared. Implementing cultural conflict management is advisable.

ConAlliance advises on Cooperations and Licensing in International Markets

ConAlliance conducts essential steps in the formation of a partnership. We advise not only on the search for and identification of suitable partners in international markets but also on negotiating partnership agreements, in order to help you maximize the value of your project. Negotiating and agreeing on a partnership is very similar to buying or selling a company, as many of the same steps must be completed before finalizing a partnership agreement.

More information on buy-side approach

More information on sell-side approach