It ensures that manufacturing teams receive all necessary design documentation, test plans, risk analyses, and regulatory information to build the product correctly and compliantly.
A Design & Technology Transfer Agreement bridges this gap by clearly defining:
✅ What is being transferred – design files, test data, risk analyses, validation reports, and know-how.
✅ Responsibilities – who provides training, who procures raw materials, and how intellectual property is protected.
✅ Payment & rights – how the license fee is structured, audit rights, and obligations of the licensee.
✅ Regulatory compliance – ensuring design transfer meets ISO 13485, ISO 14971, and national regulations (e.g., CDSCO in India, FDA in the US, CE in Europe).
🔎 Why Regulators Insist on Clear Agreements
In many cases, a manufacturer’s scope of work does not include design control—they are only responsible for production. However, regulators make it clear that design requirements cannot be ignored, because product safety and performance are directly linked to how the design is verified and validated.
Without a formal Design & Technology Transfer Agreement, this creates a dangerous compliance gap:
- 🧩 Design Verification & Validation (V&V): Even if the manufacturer is not the original designer, regulators (e.g., FDA, CDSCO, EU MDR) expect evidence that design inputs have been verified and outputs validated before manufacturing begins.
- 📝 Traceability: Every material, drawing, and specification must be linked back to risk analysis and intended use.
- ⚖️ Accountability: If the manufacturer produces devices without owning design files, they may still be held liable for failures unless roles are contractually defined.
- 🔒 Quality Management (ISO 13485): Clause 7.3 requires that design transfer is documented and controlled; simply “skipping” design because it is out of scope is not acceptable.
📌 Illustrative Examples
Example 1 – FDA 483 Observation
A US-based manufacturer (Company B) was producing a cardiac device under contract manufacturing. During an FDA inspection, the auditor asked for design verification and validation records. Company B responded that “design was not in our scope.” Since no formal agreement or transfer records existed, the FDA issued a 483 observation for missing design control compliance.
Example 2 – CE Marking Audit
In Europe, a notified body reviewed a Class IIb device manufactured by an outsourcing partner. The partner had no documented design transfer checklist, and critical test data (biocompatibility and shelf-life validation) were missing. This led to a nonconformity report under ISO 13485, delaying CE certification until the agreement was updated.
Example 3 – CDSCO Inspection (India)
An Indian contract manufacturer was producing diagnostic devices. The CDSCO audit revealed that while manufacturing controls were in place, the company could not show risk analysis and design validation documents. Without a signed technology transfer agreement, the responsibility appeared unclear. The license renewal was put on hold until documentation was corrected.
A manufacturer cannot say “design is not in my scope” and ignore verification/validation. The agreement ensures that the missing design controls are supplied, reviewed, and incorporated into the QMS, closing the compliance gap.
This template is designed to help medical device companies, startups, and research organizations document their design transfer process clearly and professionally.
Design & Technology Transfer Agreement
(Technology Licensing Agreement)
THIS AGREEMENT is made and entered into on [Date] day of [Month], [Year] by and between [First Party Name] (hereinafter referred to as the "Licensor")
AND [Name of the company], a company formed and existing under the provisions of the Companies Act, 1956 having its registered office at [Address] (hereinafter referred to as the "Licensee").
WHEREAS
- [name of the company and address] (hereinafter the Parent Company/Technology Owner) belonging to the Licensor have developed a manufacturing technology on [cardiac valve] (referred to and defined as "the Licensed Technology") referring to patent number (if any) ______________________
- The Licensor being the employer and/or education imparting institute of the inventors owns all rights, title, and interest in the Licensed Technology.
- The Licensee after due discussions with the Parent Company/Technology Owner is aware of the nuances and intricacies of the Licensed Technology and desires to obtain a non-exclusive license from the Licensor.
- This agreement is accompanied by an Annexure I – Transfer Checklist which comprises documents including design, manufacturing, test plans, standards, specifications, approval copies, patent copies.
NOW, THEREFORE, in consideration of premises and covenants hereinafter set forth, the parties hereto agree as follows:
Clause 1 – Interpretations
- "Subject to the provisions herein contained the term "Licensed Technology" shall mean the manufacturing technology for "[cardiac valve]."
- "Term" shall mean the term of this Agreement as specified in Clause 9 below.
- "Territory" shall mean the territory of India.
- Words importing singular number shall include plural and vice versa.
- References to persons include incorporated or unincorporated bodies.
Define key terms like Licensed Technology (e.g., “Manufacturing technology for a cardiac valve”), Term (duration of the agreement), and Territory (country/region).
Example: Licensed Technology: “Polypropylene surgical mesh manufacturing process.”
✅ Keep the definitions short and precise.
Clause 2 – Grant of License
- Subject to the terms and conditions herein contained, the Licensor hereby grants to the Licensee an non-exclusive license in respect of the licensed technology without any restriction of territory
- The Licensee shall have the qualified entitlement to use and/or authorize its employees, men and personnel to use the process, information, know-how and the technology contemplated and comprised in the Licensed Technology and manufacture, produce and sell products underlying the Licensed Technology
- The Licensee understands, acknowledges and agrees that if the Licensee fails, neglects or does not initiate the use of the Licensed technology within twenty four months from the date of the execution of this Agreement, this Agreement shall be terminated automatically notwithstanding anything contained in this Agreement to the contrary and the license fee paid by the Licensee to the Licensor shall be fully appropriated by the Licensor
- The Licensee shall permit, the authorized representative(s) of the Licensor at all mutually convenient times to enter into any premises of the licensee where the licensee is using the process, information, know-how and the Technology contemplated and comprised in the Licensed Technology and manufacturing, producing, stocking and selling products underlying the Licensed Technology so as to enable the Licensor to ascertain that the provisions of this Agreement are being complied with and the quality of the product is maintained.
Specify whether the license is exclusive or non-exclusive, where it applies (territory), and any conditions for termination.
Fill in: What rights are being transferred? Who can use them?
Clause 3 – Technical Assistance and Services
- Within a period of one month from the date of signing of this Agreement, the Licensor, through the Parent Company/Technology Owner, shall supply and furnish to the Licensee data and information concerning the process, know-how and the Technology contemplated and comprised in the Licensed Technology; and this includes supply of all documents containing design conditions for preparation of the adsorbent bed material.
- Without prejudice to the generality of the foregoing Clause (i) of 3, the Licensor, through the Parent Company/Technology Owner, shall supply and furnish to the Licensee such other information (which the Licensor is possessing) which the Licensor deems necessary to enable the Licensee to (i) use the process, information, know-how and the Technology contemplated and comprised in the Licensed Technology and (ii) manufacture, produce and sell products underlying the Licensed Technology in the best possible manner.
- Further, the Licensor will provide, furnish and make available to Licensee latest technology including research and engineering information, designs, production methods, improvements relating to designs, production methods, manufacture, testing, processes of the said products and engineering blueprints, if any, plant lay-out, drawings, information and documents relating to manufacturing processes of the said product and all other related information and particulars for successful installation.
- The Licensor, if so requested by the Licensee, may impart training to the designated employees, men, demonstrators, researchers and personnel of the Licensee, so as to enable the Licensee to use the process, information, know-how and the Technology contemplated and comprised in the Licensed Technology and manufacture, produce and sell products underlying the Licensed Technology in the best possible manner.
- The Licensee understands that the cost, duration and place of any such training shall be decided by the Licensor and expenses, such as traveling expenses and honorariums of the researchers, students etc. shall be paid by the Licensee. Moreover, any other services including design/field visit, etc., from Licensor will be chargeable on consultancy basis.
- If requested, the Licensor can provide technical assistance for new design and development of floor disinfection unit to the Licensee.
Outline what technical documents, designs, and know-how will be provided.
Examples: Training, test plans, product drawings, plant layouts.
Clarify if additional training or site visits are chargeable.
Clause 4 – Intellectual Property and Improvements
- Licensee understands and acknowledges that the Licensed Technology is proprietary to the Licensor and all intellectual property rights comprised and underlying in such Technology including in all its future improvements and derivations made and developed by the Licensor belongs and shall be the sole property of the Licensor during the pendency of this Agreement.
- If at any time during the use of the Licensed Technology, the Licensee invents or comes into the possession of any improvements or further inventions or derivations relating to or arising out of the licensed technology the Licensee shall intimate to the Licensor of such improvements or further inventions or derivations. The Licensor, then, certify the perfectibility, i.e. filtration activities and removal of Arsenic, iron and other bacterial infections within the ambit of the Licensed technology of the Licensor.
Confirm that ownership of the original technology stays with the Licensor.
Add a note if any improvements by the Licensee must be shared with the Licensor.
Clause 5 – Consideration
- The Licensee will have to procure the raw material and components as per the design specification from the Licensor.
- The Licensee will have the right to sell the product by using the said Technology to any Government or Private Sector organizations.
- The payment made to Licensor hereunder shall be by means of online money transfer as per Invoice.
- The Licensee agrees to pay any statutory taxes including GST, as applicable from time to time, in addition to the payments as stated above.
- The Licensee shall maintain proper books and records showing the sales of the product underlying the Licensed Technology.
- The Licensee shall permit the employees, men and personnel of the Licensor or its authorized representatives, at all convenient times, to inspect such books and records.
Mention the payment structure, mode of transfer (bank/online), and applicable taxes (e.g., GST).
Add terms for record keeping and Licensor’s audit rights.
Clause 6 – Undertakings by the Licensee
-
Licensee undertakes and agrees that it shall at all times during the continuance of this Agreement and, wherever applicable, following termination, observe and perform the terms and conditions set out in this Agreement and in particular:
- Shall use at all times its best endeavours to promote and extend the market for the products underlying the Licensed Technology in the Territory and work diligently to obtain orders therefor.
- Shall at its own expense provide advertising and publicity for the products underlying the Licensed Technology.
- Shall not, without the previous consent in writing of the Licensor, be concerned or interested, either directly or indirectly, in the production, importation, distribution, sale, licensing or advertisement of any other functionally equivalent products capable of restricting, competing or otherwise interfering with the market for the products underlying the Licensed Technology.
- Shall, in all correspondence and other dealings relating directly or indirectly to the licensing or other transaction relating to the Licensed Technology, clearly indicate that it is acting as the Licensee and not as developer of the Licensed Technology.
- Shall immediately bring to the attention of the Licensor any improper or wrongful use of the Licensed Technology and intellectual property rights underlying such Technology which come to the notice of the Licensee and shall use every effort to safeguard the property rights and interests of the Licensor, and shall at the request and cost of the Licensor take all steps required by the Licensor to defend such rights.
Describe obligations such as marketing the product, avoiding competing products, and protecting intellectual property.
Clause 7 – Warranty
The Licensor and the Parent Company/Technology Owner to the best of their knowledge and belief, considers that the Licensed Technology in no manner violates or infringes any third party rights. Any services or consultation will be rendered hereafter on chargeable basis.
Clause 8 – Liability
Licensor shall not be liable to the Licensee for any statement, representation, condition, warranty or other terms express or implied, as to the quality, merchantability, suitability or fitness of the Licensed Technology
Clause 9 – Duration and Termination
- This Agreement shall be effective for a period of 14 years subject to renewal from the date of signing this Agreement.
- The parties, sixty (60) days prior to the normal expiry of this Agreement, may extend the term of this Agreement on such terms and conditions as mutually agreed.
- After the end of this period, the License may be renewed for a further period of 5 years if no unpleasant, defaulted, or unwarranted activities are committed by the Licensee during the tenure of this Agreement, or otherwise if the Licensee has not received any punishment by the appropriate Court of Law.
- In the event of bankruptcy, winding up, or insolvency of either party hereto, the other party may unilaterally terminate this Agreement by a notice in writing, and the License shall terminate on and from the date when such termination notice is duly dispatched.
- Notwithstanding anything contained in this Agreement to the contrary, the license fee paid by the Licensee to the Licensor shall be fully appropriated by the Licensor in the event of prior termination of the License in any manner whatsoever in accordance with the Clauses mentioned herein.
Clause 10 – Secrecy
- The Licensee and the Licensor understand and acknowledge that all information and data exchanged between both parties are trade secrets, and both parties agree that such information shall not, without prior written consent of the other, be sold, assigned, or divulged in any manner whatsoever except to their employees, demonstrators, researchers, and personnel.
- Both parties shall take all due care, measures, and steps to protect the aforesaid information and data against any unauthorized disclosure.
- Both parties undertake to ensure that all such employees, demonstrators, researchers, and personnel to whom confidential information is disclosed shall sign and execute legally valid and binding non-disclosure agreements to fully protect the rights of the parties over such information and data.
- This Clause shall survive for a period of 10 years following the termination or expiry of this Agreement.
Clause 11 – Taxation
The Licensee undertakes to bear all duties, taxes and any similar charges, which may be imposed by Government and regulatory authorities concerning any payment covered and contemplated in this Agreement.
Clause 12 – Dispute Resolution
- The party raising the Dispute shall promptly provide the other party with a written notice reasonably detailing the Dispute (a "Dispute Notice"). The parties will attempt to resolve the Dispute amicably through discussion within thirty (30) days of receipt of such Dispute Notice.
- If the Dispute is not resolved through mutual discussion, the parties shall submit the Dispute to final and binding arbitration conducted and administered under the Rules of Arbitration as per the Arbitration and Conciliation Act, 1996 (or any amendments thereto). The arbitration shall be conducted in the English language, in Delhi, India, or at the High Commission of India in the Country of Origin of the Licensor. The arbitration shall be conducted by a mutually agreed sole arbitrator. The arbitrator may enter a default decision if a party fails to participate. The costs of the arbitration proceedings shall be equally shared by the Licensor and the Licensee. The award of the arbitrator shall be binding on both parties.
Clause 13 – Applicable Law
This License shall be governed, construed and interpreted in accordance with the laws in force in India and Country of Origin of Licensor
The Licensee shall obtain necessary approvals i.e Local regulatory and comply them as per their own capacity.
Clause 14 – Force Majeure
- Neither party shall be liable to the other for non-performance or delay in performance of any of its obligations under this Agreement where such failure or delay arises due to a Force Majeure situation caused by factors reasonably beyond its control.
- Upon the occurrence of such a Force Majeure condition, the affected party shall immediately notify the other party with full details of the condition and shall promptly inform the other party of any further developments.
- Immediately after the removal of the Force Majeure condition, the affected party shall perform its unperformed obligations as expeditiously as possible. However, if the Force Majeure condition subsists for a period of more than twenty-four (24) months, this Agreement shall terminate automatically notwithstanding anything contained herein to the contrary, and the license fee paid by the Licensee to the Licensor shall be fully appropriated by the Licensor.
- Warranty: State Licensor believes technology doesn’t infringe third-party rights.
- Liability: Limit Licensor’s liability.
- Termination: Define duration (e.g., 14 years) and renewal terms.
- Secrecy: Add confidentiality / NDA commitments.
- Dispute Resolution: Arbitration rules (usually as per Indian Arbitration and Conciliation Act).
- Governing Law: Mention applicable jurisdiction (e.g., India).
- Force Majeure: Covers natural disasters, pandemics, wars, etc.
Clause 15 – Notices
All communications valid if made via email/post and confirmed in writing.
To Licensor: ____________________
To Licensee: ____________________
Clause 16 – Entire Agreement
This Agreement supersedes any arrangements, understandings, promises or agreements made or existing between the parties hereto prior to or simultaneously with this Agreement and constitutes the entire understanding between the parties hereto on this specific Technology transfer. No addition, amendment to or modification of this Agreement shall be effective unless it is in writing and signed by or on behalf of the parties.
Clause 17 – Severability
In the event any part of this Agreement or any of the terms, conditions or provisions contained in this Agreement is determined by any competent authority to be invalid, unlawful or unenforceable, then to the extent possible such part, term, condition or provision could be severed from the remaining terms, conditions and provisions and such remaining terms, conditions and provisions shall continue to be valid and enforceable to the fullest extent permitted by law.
Clause 18 – Language
All correspondence and documentation shall be in English.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed:
| For and on behalf of Name of the company (Licensor) |
For and on behalf of Name of the company (Licensee) |
| Witness | Witness |
Standard clauses covering:
- Entire Agreement: No modifications unless written & signed.
- Severability: Invalid clauses don’t void the whole agreement.
- Language: Specify English (or agreed language) for communication and documents.
Annexure I – Transfer Checklist
1.1 Design Transfer Questionnaire
| Question | Answer |
|---|---|
| Are the test plan, procedures, and test fixture documentation complete and validated? | Yes |
| Is there evidence of design verification and validation? | Yes |
| Is the process validation report complete? | Yes |
| Is a completed hazard analysis available? | Yes |
| Has a product-failure mode and effects analysis been performed and documented? | Yes |
| Is a final acceptance test report available? | Yes |
| What regulatory approvals are required (FDA, UL, CE, CDSCO etc.)? | CDSCO |
| How many off-the-shelf parts are in the device? | None |
| Are standard components specifications available for all off-the-shelf parts? | Yes |
| How many custom parts are used in the device? | None |
| Are specifications and drawings available for all custom parts? | NA |
| Have all parts been assigned part numbers? | Yes |
| Does an approved-vendor list exist? | Yes |
| What is the Risk Class of the Device? | Class C as per MDR 2017 (I) |
| Does the product have FDA market approval? | Yes |
| If not, how does the product developer intend to submit? | NA |
| Is the bill of materials complete and fully costed? | Yes |
| Are all part drawings and schematics complete and ready for production? | Yes |
| Are complete assembly procedures available? | Yes |
| Are assembly fixtures required? | Yes |
| What is the estimated production yield? | 95% |
| Has packaging been designed and validated? | Yes |
| Has labeling been designed and validated? | Yes |
1.2 Design Transfer Checklist
| Particulars | References/Attachments |
|---|---|
| A product development quality plan has been established. | |
| Design verification and validation results are up-to-date. | |
| A detailed risk analysis is complete and available. | |
| Documents outlining product requirements are created. | |
| Software requirements documents are prepared. | |
| Custom parts specifications are available. | |
| Standard parts specifications are documented. | |
| All drawings and schematics are completed. | |
| A Bill of Materials (BOM) is finalized. | |
| Assembly drawings and procedures are available. | |
| Process validation report is complete. | |
| Hazard analysis and FMEA are documented. | |
| Final acceptance test procedures are available. | |
| Packaging design is complete and validated. | |
| Labeling has been designed and validated. |
This ensures that all design files, validations, risk analyses, and manufacturing instructions are handed over to the Licensee.
Key Items to Review:
✅ Test plans, validation reports, and hazard analyses are complete.
✅ Risk analysis and FMEA documented.
✅ Bill of Materials (BOM) finalized.
✅ Assembly procedures, inspection plans, and packaging specifications available.
✅ Device Master Record (DMR) and Device History Record (DHR) prepared.
✅ Regulatory approvals (CDSCO, FDA, CE, etc.) identified.
How to Fill: Mark Yes/No for each checklist item, attach supporting documents (drawings, reports), mention timelines (e.g., “Manufacturing time: 8 hours”), and record vendor details.