Pricing of Licenses on CERN Technology

This Master thesis develops a framework for the pricing of licenses on technology, suitable for a Technology Transfer (TT) context that is characterized by a goal of dissemination, early-stage technologies, limited market information, and great variations between technologies. The chosen context is defined by comparing the policy and the specificity of the initial recipient, CERN, to other public research institutions, thereby aiming at the development of a general framework. A conceptual model of the framework is thereafter developed to accommodate considerations of all the indicated characteristics through three main subparts: 1)~the target price, 2)~the walk-away point, and 3)~the royalty structure. For estimation of a suitable target price, valuation methodologies from academic and business literature are reviewed and discussed with regard to their suitability for the chosen TT context, thus selecting six methods of different approaches and varying information dependency. A method for quantifying the appraiser's qualitative judgment of a technology's potential profitability and associated risk, termed technology utility, is subsequently developed and integrated across the selected methods. Moreover, through an analysis of walk-away point and royalty structure, the dissemination perspective is given due consideration and some practical guidelines are suggested. Lastly in the development, a pricing process for employing the framework is presented, indicating the different steps involved and the considerations necessary. A case implementation on a CERN technology is thereafter provided, together with a thorough sensitivity analysis and discussion of the thesis.