SHEFFIELD University spin-out Fusion IP has announced its first major licensing deal.
The £800,000 landmark contract is with a leading global orthopaedic company for the use of orthopaedic planning software.
The software was developed by the Medical Physics team at the University of Sheffield.
The deal will result in a one-off l
icence fee income for Fusion of just over £400,000.
Under Fusion's agreement with the University of Sheffield, the company has the right to license out any university originated intellectual property, with half the net income going to Fusion.
The new deal is Fusion's first major licence fee to be generated since the expanded agreement was announced a year ago.
Fusion chief executive David Baynes said: "This licence deal demonstrates the value of our pipeline and endorses our ability to extrapolate real value from university research.
"We hope this will be the first of many licence deals in Sheffield as we build towards our target of covering Fusion's on-going overheads from licence income by 2011/12."
Earlier this month Fusion raised £3m by selling a 20 per cent stake to its bigger rival IP Group.
Fusion, which owns the exclusive rights to commercialise research from Sheffield and Cardiff universities, is also giving IP Group the option to invest in any new companies it creates.
London-based IP Group, which commercialises the research of 10 universities including Oxford and York, said the two companies would work well together, while refusing to rule out a future takeover bid for Fusion.
Fusion reported a pre-tax loss for the year to the end of July, broadly level with a year ago at £5m.
However, after spin-out costs and amortisation, Fusion cut losses by a third to £1.1m.
Fusion, which was previously called Biofusion, said the fundraising would allow it to invest more in the University of Sheffield.
