In any business, the spend on intellectual property (IP) legal advice needs to be commensurate with the value and importance of IP to the business. There is no “one size fits all” model. In the first of this series of five articles, we explored an overview of considerations that could be taken into account, and introduced three different business plans.
In this article, we will consider how those practical considerations might be applied in the case of a company that produces and sells its own products. In other words, the company is commercialising its technology ‘in-house’.
For a more detailed discussion specific to you and your IP, please do reach out to us or one of our Abel + Imray colleagues.
Are patents the right approach?
When commercialising ‘in-house’, it may be possible to keep many aspects of the technology secret for an extended period. In that case, it may be appropriate to retain technical details as confidential ‘know-how’, at least for a while. Take, for example, development of a new method of making a known polymer. The polymer itself will not be patentable if it is identical to the known polymer. However, you may be able to get a granted patent for the new method. This would mean filing a patent application which will be published, informing the world of your new method. If you are able to keep the method secret, you may decide to do that and not file a patent application, at least while you focus your attention on making and selling the polymer yourself.
Keep in mind that you need to take care with your ‘know-how’. You should be able to demonstrate that your ‘know-how’ has actually remained secret, what steps you have taken to maintain confidentiality, and that its secrecy has a commercial value. In practice, this means that ‘know-how’ should be documented, and some kind of policy on handling confidential information should be put in place.
Where should patents be filed?
If you do decide to seek patent protection, important points to consider are: which markets are important to the business, and when? Polymer technologies often require high capital investment, and can have long lead times. If the focus in the first 5-10 years will be Europe, followed by the US, filing a costly patent application in Japan (with a maximum duration of 20 years from filing) may not be an effective use of resources. For example, it may be more sensible just to file applications in Europe and the US.
On the other hand, you may wish to consider how third parties operate. Might key competitors encroach on your target markets even while based at least partly in another location? For example, if you develop a new monomer feedstock, is there a way of protecting a product later in the chain to target import of the finished item into your market?
Are you free to operate?
If you are going to put your own capital and resources on the line to commercialise your technology, it is especially important to understand the risks posed by third party IP rights. However, ‘freedom to operate’ searches and analyses can become excessively costly and complex if not framed appropriately.
Patent rights are territorial and are therefore only effective in the countries in which there are granted patents. When it comes to freedom to operate in light of third party rights, you may therefore wish to start by focusing on the territories in which you plan to operate first. That can help avoid expensive and time-consuming searches across wide geographical areas.
Another point to consider may be: which aspects of your process or product are essential to your business? Are there aspects of your technology that are so essential that you would not be able to develop an alternative? Those aspects may be the ones to which you pay particularly close attention.
Finally, can you rely on using ‘old’ technology in some areas? Patent rights are time-limited, generally to a maximum of 20 years from the application date. Can you make use of technology which has been known for long enough that it can no longer be protected by valid patent rights?
These considerations may help you to streamline and focus your freedom to operate efforts.
Other business objectives
In later articles we will consider strategies that may be adopted by companies primarily seeking to licence out their technology for adoption by others, and those setting themselves up for acquisition by another business.
We are a European firm and assist our clients to protect their IP rights in the UK, Europe and worldwide from our offices in the UK and The Netherlands and through our international network of trusted local attorneys. Get in touch if you would like to discuss your innovations and brand protection further.
This article is part of a series, read more here:
Part 1: Matching your IP strategy to your commercial plan – making the most of your resources
Part 3: Matching your IP strategy to your commercial plan – ‘technology licensing’
Part 4: Matching your IP strategy to your commercial plan – exit through acquisition
Part 5: Matching your IP strategy to your commercial plan – efficient decision making