With increased competition and globalization, legal protection for inventions is becoming more important. After all, companies want to protect their rights and develop a strong intellectual property rights portfolio to gain a competitive advantage. However, the desire for exclusive rights comes at a high cost. The R&D process, patent filing, and patent maintenance are all costly aspects of owning a patent. As a result, businesses strive to find the best patentable inventions that will provide the most value to them. The screening process and factors used by a company to select inventions that require patent protection are discussed further below.
Phases of a Patent-Based Intellectual Property Asset
The journey of an invention to becoming an IP asset is divided into three stages:
Phase 1: Choosing an Invention
Companies in the technology industry are flooded with inventions awaiting patents. Given the limited resources available, it is critical to identify those that will be most profitable and align with the company’s goals and vision. Generally, the company’s selection process should include two types of analysis: IP analysis and business analysis.
1. IP Analysis
IP analysis is a set of steps taken to assess the patentability of an invention. Subsequently, to be patentable, it must fulfill the requirements of being novel, non-obvious, and commercially usable.
A prior art search is conducted to reveal any prior references to the invention in public knowledge in order to establish novelty. This falls within the scope of patentability search, which is an important component of the IP analysis stage.
A patentability search, also known as a novelty search, determines whether an invention qualifies for a patent. Chiefly, it identifies patent and non-patent literature that could be relevant to the current invention. Because patentability searches are time-consuming and require expert intervention, specialized firms are frequently hired. XLSCOUT’s AI-based novelty search tool- Novelty Checker is helping to achieve the feat.
The Advantages of the AI Platform are:
- Easy to use platform – Anyone can access
- Gives patentability search report in 10 mins (Top 10 matching documents)
- It compares with both global patents and literature in real-time
- Innovation triggers and dynamic industry focus reports to align research and innovate better
The goal of an IP analysis is to determine whether the costs of applying for a patent are justified. Following the completion of the patentability search, the IP Strength Index is used to assign the potency of an invention on a scale of high, low, and medium.
A high index score indicates that the innovation has little or no prior art and meets the novelty criteria. A low score, on the other hand, clearly eliminates the possibility of the invention obtaining a patent. Although, a high IP Strength Index score does not guarantee that the invention will be submitted for patent. It must also be approved in the business analysis before proceeding to the next stage.
2. Business Analysis
To evaluate the potential for success of the intended invention, the business or market analysis considers consumers, consumption patterns, trends, and existing market products. It examines the market for key competitors, determining the scope of commercialization inherent in the invention, and identifying gaps that the invention may fill.
The goal of this exercise is to determine whether the product has a chance of success in the market so that they can consider going ahead with the filing process. Business analysis also aids in the planning of the new product’s development, application, and marketing.
Prior to filing a patent, two types of market research may be conducted: quantitative research and qualitative research. Quantitative research is useful for determining the target audience and the number of individuals who are likely to use the invention. As a methodology, surveys, questionnaires, and so on may be used. Qualitative research, on the other hand, evaluates various factors and provides insight into the product’s predicted commercial viability. A Business Case Strength Index (BCSI), similar to the IP Analysis, can be used to rank the inventions as high, medium, or low based on their performance.
Phase 2: Patent Filing
After deciding on the invention to be patented, the next step is to contact the patent office to begin the filing process. Every country has its own set of rules for granting patents. The patent granting process can take up to three years in some cases. It is critical to be thorough in document submission and follow all mandated rules so that your application can pass all levels of scrutiny without unnecessary delays.
Phase 3: Patent Commercialization
When an invention is patented, the inventor gains exclusive rights to its use. They have the legal right to forbid anyone from using or manufacturing the invention without their permission. Some methods for commercializing and monetizing a patent include licensing, cross-licensing, and selling.
IP Management Techniques
A company’s IP strategy is determined by its industry position, business requirements, size, and vision. Julie Davis and Suzanne Harrison developed a five-level hierarchy pyramid to describe how businesses approach intellectual property management:
- Defensive Level: At this stage, the focus for businesses is on defending their innovations against infringement and ensuring that they do not infringe on the innovations of others. High filing and enforcement fees are common.
- Cost Control Level: While the primary focus remains on protecting their innovation, businesses are now looking for ways to reduce the cost of IP creation and maintenance.
- Profit Centre Level: This stage is reached when a company begins to license or profit from its patents.
- Integrated Level: The fourth stage involves companies recognizing the value of their intellectual property and implementing it across the spectrum of their business activities.
- Visionary Level: The final level occurs when companies recognize the strategic importance of their intellectual property assets and focus on long-term value creation.
A healthy IP portfolio is the key to the firm’s success and profitability. It can assist them in generating royalty revenue, attracting additional funding from investors, and adding value to the company’s overall valuation. The first step in creating desired IP assets is to select the right patents to enhance your portfolio. This can be easily accomplished and leveraged to solidify your IP assets with the right tools and evaluation methodology.