Evaluation of IP for Commercialization

Josiah Hernandez

The Value of Commercialization

• The value of intellectual property lies in its commercialization and not in its mere creation and development. It is the IP which leads the merger to emerge and those companies which have I P dominance take the shot. Companies derive competitive advantage that arises out of the way in which Corporate organizes and performs IP blended activities, and the activities are the means by which a firm creates value in its product for its buyers. The value and the value addition for the buyer is the end product for any organisation and the organisations can best achieve this value addition through its Intellectual Property Profile.

Understanding what you have at hand

• Deciding what are the best options– Selling– Donating– Licensing in/out– Developing into product– Spin-off/divestigure– Start-ups

Auditing the patent portfolio

• Organizing each patent in the portfolio in several categories– Oldest to new– Maintenance fee due dates– Which belong to the highest revenue generation

department– Which belong to highest potential technology field– Type of technology the patents belong to:

pioneering, development, well established, saturated

Evaluation of each patent

• Legal– Are the claims structured well (is it too broad or

too specific)– Can the patent be invalidated – Does the patent effectively protect the invention– Disclosure structure– How many patents exist for each product

Technology analysis for the Patent

• What type of technology is it: pioneering, developed, saturated

• Does it actually work• Does it solve an important issue• Are there alternative technological solutions

to this product• Is the technology soon to be obsolete

Market analysis of the Patent

• Are there products like the patent or similar that are out in the market

• Evidence of use• How big is the market for this product• How many alternative products are out there• What is the market trend/demand for such a

product in the next 5-10 years

Strategy for portfolio building

• More than one patent per product• Building a wall of patents around your main

patent• Enclosing the competition by building walls

around their main patents• Compartmentalizing each portfolio on a per

product basis • Audit and keep track of every patent in the

portfolio

Deciding what option to take for each patent/portfolio

• Need to have an idea on competition and other related patents

• Need to consider:– Life time of patent– Competitors– Related technology– Market size– What your business is dedicated to and what they can do

with each patent– Investment $$$ for each options– Return for each option

Donating Patents

• Is the patent a soon to be obsolete technology• Is the life time of the patent about to run out• Are there maintenance fees due• Will it favor your books • Is the amount you can get by selling or

licensing minimally small that you can’t justify the costs

Selling your Patent

• Is there only one or a small amount of potential buyers

• Is the technology soon to change and become obsolete

• Is the life time of the patent about to end• Do you need a lump sum of return• Will you get more selling it than licensing it• Can you build your own product from the

patent or is your company not set up for that

Licensing the Patent

• Life time of the patent• Are there a lot of potential candidates • Are you set up to make the product• Is it more economical in the long run to

license it• How many companies are there that are

related to this technology

Building your own product from the patent

• Do you have the facilities and machinery to build such a product

• Is the amount of $$$ that you can make in the 20 years of the patent, from making the product and marketing it more than selling or licensing the patent

• How fierce is the competition is it saturated with too many companies or are you one of the few (building it makes sense if you were one of the few)

Spin-off, divestigure, start-up from the patent

• Is the owner of the patent a company that is too large and doesn’t make financial sense to do it at that level

• Is it more feasible to do it by a small company• Is it a very specialized technology and a sound portfolio

and developed enough to start your own operations• Do you have the personnel to manage such a task• Does it make more sense, in the long run, to be

partners of such a spin-off/start-up, as opposed to licensing or selling the patents