Unworked Patents: Possible Strategies to Capitalise Them

Unworked Patents: Possible Strategies to Capitalise Them

Intellectual Property indisputably is a key to business success.

In the specific case of patents, a company with a patent portfolio will be able to exploit it to exclusively implement their patented technologies, thus preventing competitors from manufacturing products or using processes covered thereby.

Although the need to preserve their competitive advantage is often the main reason why companies seek patent protection, they should bear in mind that the value of patents is not limited to the mere exclusion of competitors.

What happens where a company – perhaps because of a change of strategy or the difficulty in finding the necessary resources – does not make use of a technology for which they own a patent?

How else can a company valorise their own patents and profit therefrom without risking wasting the investment incurred to obtain them?

There are several alternative strategies to turn a patent - even if unworked - into a profitable asset that can actively contribute to company growth and competitiveness: from licensing to third parties, which allows to monetise the innovation without having to develop it directly, to the assignment of the patent itself, up to the use of exclusive rights as leverage for strategic negotiations or to attract investors interested in promising technologies.

Patent Licensing

Licensing a patent is an effective strategy to obtain an economic return without having to develop the patented technology directly. This approach makes it possible to broaden the dissemination of innovation, build strategic partnerships and generate a continuous revenue stream without having to deal directly with production or commercialisation.

When drafting a license agreement, special attention must be paid to the following aspects:

• royalties and corresponding modes of payment,
• territory to which the licence to use the patent is limited,
• period of validity of the licence,
• exclusivity/non-exclusivity of the licence,
• licensee's obligations (e.g. production and quality standards),
• burden of defending the patent (i.e. who is responsible for defending the patent in case of litigation over possible patent infringements).

Patent Selling

If a company decides not to develop the patented technology, selling the patent is an option to monetise the initial investment. By selling the rights of ownership to another company or investor, an immediate gain can be obtained and resources can be freed up for new ventures. The sale can be advantageous especially when the patent is particularly innovative or in demand on the market, attracting companies interested in achieving a competitive advantage.

Leverage for Strategic Negotiations

A patent can be used as an instrument in business negotiations. Companies can use it to obtain favourable terms in collaboration agreements, joint ventures or mergers, exploiting the value of technological exclusivity. A strong patent can become a strategic asset that increases negotiating power, allowing access to new opportunities for growth or consolidation in the relevant sector.

Attracting Investors

Investors are often interested in innovative technologies with market potential. A patent can be a pivotal element in attracting funding and partnerships. Indeed, intellectual property is an intangible asset that increases the value of the company, gives it credibility and reduces the perceived risk for investors, making the company more attractive to venture capitalists, investment funds and large corporations looking for new investment opportunities or technology solutions to develop.

Last but not least, a patent portfolio also acts as an attractor for qualified and talented employees, as it demonstrates a company's strong commitment to innovation and long-term growth, and the presence of qualified employees in turn encourages the development of new ideas and solutions, triggering a virtuous circle that benefits the company's competitiveness.

How Can We Help?

For individuals and companies whose IP portfolio includes unworked patents, our firm can provide support to try to seize the opportunities outlined above through a targeted and structured path.

First, we can take care of the search for potentially interested parties, identifying companies, investors or strategic partners that could benefit from using or purchasing the patented technology. Using our tools for analysing the patent landscape, we identify qualified interlocutors. Moreover, we can also assist clients in preparing an effective contact plan.

Once we have identified potential licensees or purchasers, we can support clients in drafting a clear and persuasive presentation letter aimed at presenting the company and communicating the value of the patent and the opportunities it may offer. This document is designed to generate interest and initiate concrete negotiations, highlighting the technical, commercial and strategic aspects of the patented technology.

As a result of the interest shown by the parties, we can assist in drafting assignment or licence agreements, ensuring that the terms are advantageous and comply with the applicable national or international regulations. We precisely define key elements such as fees, territories of application, duration of the contract and protection clauses, ensuring clients a solid and beneficial agreement.

For any information or assistance, please contact us at email@interpatent.com.