In 1985, Yale University received a patent for its d4T discovery, a novel technology for the treatment of the AIDS virus.  A few years later, the University granted an exclusive license to Bristol-Myers Squibb(BMS) to use this intellectual property in the development of Zerit®.  In 1994, almost ten years after obtaining the patent, Zerit® was approved by the FDA for the treatment of HIV and AIDS infection.

In July 2000, Royalty Pharma entered into an agreement with the University to purchase their Zerit royalty stream. In this case, a trust was created primarily for the purpose of funding the purchase payment.  The trust obtained a six-year loan for a portion of the purchase price with the remaining funds provided by three equity partners, Royalty Pharma, BancBoston Capital and Yale University.  Upon closing, Yale University received a cash payment in addition to equity in the trust. 

Each quarter, the trust receives the royalty payments directly from BMS.  Upon receipt of the funds, the trust redirects thirty percent to the inventors (per the university patent policy) and seventy percent is allocated according to the trust agreement; the loan payments are serviced and the surplus is distributed equally to the three partners.

By monetizing the Zerit® royalty stream, the University was able to partially finance the construction of a new classroom and research complex, now known as the Yale University School of Medicine, Congress Avenue Building.