On Nov. 23, 1998, the University of California, Berkeley and the Novartis Agricultural Discovery Institute, announced they had agreed to create a unique long-term research collaboration that will keep UC Berkeley scientists and California farmers at the forefront of agricultural biotechnology.

Under the terms of the agreement between Novartis and the Department of Plant and Microbial Biology in the College of Natural Resources, Novartis commited $25 million over five years to support basic research in the department in the area of agricultural genomics. It will also provide access to proprietary technology and DNA databases, which will significantly enhance the university’s ability to do research at the forefront of plant genomics.

In return, Novartis scientists worked closely with UC Berkeley researchers, and the company will receive first rights to negotiate for a fraction – roughly 30-40 percent – of the discoveries made in the department. The fraction corresponds approximately to the proportion of the department’s total research budget provided by Novartis, and will vary from year to year. Novartis will pay patent costs, license fees, royalties and all other costs normally associated with the commercialization of research, but the university will own the patents and collect royalties on their use.

Under the agreement, Novartis will provide the department with five million dollars a year for five years, to be awarded by the five-member research committee. The funds will have no restrictions on their use, and will go solely for non-targeted, basic research in plant genomics.

Novartis, in turn, will have first rights to license a fraction of the research developments in the department, whether sponsored by Novartis or by certain state or federal agencies like the National Institutes of Health that allow such arrangements. The fraction will be determined by the proportion of departmental research Novartis funds – a method of calculation recommended by National Institutes of Health guidelines regarding agreements like this.