Universities and research institutions invest significant resources in generating new knowledge, developing innovative technologies and protecting intellectual property. Patents play a critical role in this process by protecting inventions, attracting investment, facilitating licensing and supporting commercialisation. However, successful technology transfer frequently depends on more than the transfer of patent rights alone.

A recurring challenge is that while an invention can be transferred through a licence agreement, the knowledge required to implement, optimise and scale that invention frequently remains with the inventors themselves. Successful commercialisation therefore often depends not only on intellectual property rights, but also on the transfer of the knowledge, skills and experience that enable those rights to be translated into commercial outcomes.

The Hidden Value of Know-How

Patents provide an essential mechanism for disclosing and protecting inventions, but they are not intended to capture every practical insight generated during research and development. Researchers often develop valuable know-how in the form of optimisation techniques, troubleshooting methods, testing protocols, process parameters and practical experience acquired over years of experimentation.

Much of this knowledge is tacit rather than explicit. Explicit knowledge can be documented and shared through patents, publications, reports and manuals. Tacit knowledge, by contrast, is acquired through experience and practical application. It includes the insights researchers develop while refining a process, overcoming technical challenges or adapting a technology for real-world use. In many cases, this tacit knowledge determines whether a technology can be successfully adopted and commercialised.

As a result, a patent licence may transfer the legal right to use an invention, while the practical ability to implement that invention remains dependent on know-how held by the research team.

A Biotechnology Case Study: The Commercial Value of Know-How

The commercial significance of know-how is illustrated by the well-publicised JHL Biotech and Genentech matter. According to the United States Department of Justice, former JHL Biotech executives were convicted in connection with the acquisition and use of Genentech's confidential information, including scientific know-how, manufacturing procedures, standard operating procedures and technology transfer documents (https://www.justice.gov/usao-ndca/pr/former-ceo-and-coo-jhl-biotech-sentenced-conspiring-steal-trade-secrets-and-commit-wire). The information was allegedly used to accelerate biosimilar development, support regulatory compliance and facilitate manufacturing activities.

For technology transfer professionals, the significance of the case lies not in the misconduct allegations but in what they reveal about the value of know-how. The matter demonstrates that technical expertise, operational knowledge and accumulated experience can possess substantial commercial value alongside patented inventions. According to the Department of Justice, the information allegedly helped avoid experimentation, reduce costs and accelerate development timelines, highlighting how valuable know-how can be in practice.

A South African Perspective: Know-How Ownership and Retention

A similar lesson emerges from the South African matter of Universal Blending (Pty) Ltd v Henderson (2021/21636) [2023] ZAGPJHC 1786. The dispute involved a former employee who had played a significant role in developing and refining a product and who was alleged to possess valuable confidential information relating to its formulation. The case highlighted a practical reality faced by many organisations: commercially valuable know-how often resides with individuals rather than with the institution itself.

Although the matter turned on ownership and evidentiary issues, it nevertheless illustrates an important risk. When valuable technical knowledge is not adequately documented, assigned or captured, organisations may struggle to protect or fully exploit that knowledge.

Together, the JHL Biotech and Universal Blending matters reveal two sides of the same challenge. Valuable know-how may be enormously important to commercial success, yet it may also be vulnerable if organisations fail to identify, retain and manage it effectively.

The University Technology Transfer Opportunity

These lessons are particularly relevant to universities and research institutions. Research projects routinely generate intellectual assets that extend beyond patentable inventions, including laboratory protocols, testing procedures, process optimisation techniques, software tools, manufacturing parameters and practical expertise developed through experimentation.

Technology transfer offices are generally skilled at identifying patentable inventions and managing intellectual property portfolios. However, commercialisation often depends on assets that do not appear on patent registers. A commercial partner may obtain a licence to a patented technology and still struggle to reproduce results, scale production or overcome technical challenges without access to the underlying expertise developed by the research team.

Effective commercialisation strategies should therefore consider not only which inventions can be patented, but also what know-how should be identified, documented, protected and transferred to commercial partners. In some cases, successful technology transfer may require training, collaborative development programmes, consulting arrangements or continued inventor involvement to ensure that critical expertise is transferred alongside intellectual property rights.

Why Spin-Outs Can Be Effective Vehicles for Know-How Transfer

University spin-outs can be particularly effective where significant know-how resides within the research team. By retaining the inventors and technical specialists who developed the technology, spin-outs facilitate the transfer of tacit knowledge that may be difficult to capture fully in patents, licence agreements or technical documentation.

This continuity of expertise can accelerate product development, reduce implementation risk and improve commercialisation prospects. In addition to providing a vehicle for commercialisation, spin-outs can serve as mechanisms for institutional knowledge retention, reducing the risk that critical know-how is lost during the transition from laboratory to market.

Managing Know-How as a Strategic Asset

Recognising the value of know-how raises an important question: how can institutions protect and retain it?

Unlike patents, know-how is frequently protected through confidentiality measures, trade secret strategies, internal knowledge-management systems and carefully structured commercial agreements. Institutions should therefore identify important know-how early in the innovation process and ensure that it is appropriately recorded, managed and transferred.

Practical measures may include laboratory manuals, standard operating procedures, technical handover processes, inventor interviews and structured documentation of optimisation work carried out during research projects. Institutions should ask not only, "What can we patent?" but also, "What knowledge would be difficult for a third party to reproduce without assistance from the research team?" The answer often reveals know-how that warrants protection and inclusion within a broader commercialisation strategy.

Conclusion: From Technology Transfer to Knowledge Transfer

Patents remain one of the most important tools available for protecting and commercialising university innovations. However, successful commercialisation frequently relies on a broader package of intellectual assets that includes know-how, technical expertise and practical experience.

The lessons from both the JHL Biotech and Universal Blending matters are not that patents are insufficient, but rather that patents and know-how often work together to create commercial value. Universities that identify, protect and transfer both patented inventions and associated know-how are likely to be better positioned to maximise the impact of their research and improve commercialisation outcomes.

At KISCH IP, we work closely with universities, research institutions and technology transfer offices to identify, protect and commercialise valuable intellectual assets. This includes assisting institutions in developing strategies to identify, document, retain and leverage know-how that may not be fully captured in patent applications or other forms of intellectual property protection. By integrating patents, confidential information, trade secrets and know-how into a unified commercialisation strategy, institutions can better preserve critical knowledge and maximise the long-term impact of their innovations.