QUB-linked research body in dispute with firm over £7m payment
A publicly-funded research body has said the recovery of £7m in overdue royalty payments is a priority.
The Agri-Food and Bioscience Institute (AFBI) is in dispute with a vaccine company over the money, which it claims it is owed.
Details emerged in a report published by the Northern Ireland Audit Office.
Kieran Donnelly, the comptroller and auditor general, noted the £7m sum had been included in AFBI’s 2018/19 accounts, when it was “not probable” the amount will be received.
His report states the royalty income is subject to a dispute regarding the interpretation of a licence agreement.
He has disagreed with AFBI’s recognition of the payment, and determined its inclusion is not in line with financial reporting guidelines.
The report explains how company patent royalties are paid by the vaccine company, which is not identified, to Queen’s University Belfast (QUB), which acts as AFBI’s agent, and the University of Saskatchewan (USK) in Canada.
Under an agreement dating back to 1998, the vaccine company pays a percentage royalty on the net sales of all vaccine products manufactured by making use of the results of joint research.
However, since June 2018, QUB has received only one payment of £68,000 for patent royalties for 2018/19 from the vaccine company, which was passed on to AFBI.
AFBI recorded income of £7m in its 2018/19 financial statements, of which £6.9m is considered receivable at the year-end.
Mr Donnelly said: “The £7m in income included in the financial statements is an estimate based on the validity of the patents during the 2018/19 financial year, and a report from QUB which concluded on the income these patents might generate.
“There is currently no documentation to suggest that the vaccine company agrees that £7m or any other sum is due to AFBI.”
An AFBI spokesperson said the £7m of overdue royalties is “a significant level of income” and its recovery “remains a priority”.
They added: “AFBI strongly believes the amounts included in the financial statements are payable and will ensure every effort will continue to be made to recover it.”
Belfast Telegraph Digital