Transcript Adding Value to Early Stage Technologies

“How Do We Get There From
Here?” – A Strategy for IP
Management
APEGGA Calgary Branch
April 08, 2004
Beverley Sheridan
President, Technology NOW
403-246-5939
[email protected]
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The Right Answers to the Right Questions
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IP – So…what’s this all about?
The Secret
of IP
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The Right Answers to the Right Questions
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IP – So…what’s this all about?
Important People
International Politics
Imaginary Product
Intellectual Property
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IP – So…what is it?
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Knowledge
Scientific and technical data
Documents, records, instructions
Systems and processes
Designs and prototypes
Software, copyrights
Know-how
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IP – So…what is it?
Creations of Human Intellect
that are protected by law.
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What is a Patent?
“The primary goal of the patent system is to encourage
innovation and commercialization of technological advances.
To this end, the patent system offers an incentive to inventors
to publicly disclose their inventions in exchange for the
exclusive right to prevent others from making, using, offering
for sale or selling the inventions throughout the country that
issues the patent or importing the inventions into the country
that issues the patent.”
John Ramsay
“Technology Transfers and Licensing”
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What is a Patent?
• A conferred monopoly
• Right to exclude others from making, using or
selling for a set period of time (20 years from
date of filing)
• Scope of the monopoly is defined by the claims
• Given in exchange for full disclosure of the
invention
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What A Patent Is Not
• Does not confer the right to commercialize
• Patent holder can only exclude others in the
country where the patent is issued
• It’s not forever – 20 years from the date of
filing the application
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Why Get a Patent?
• Exclude others
• Patent rights can be
sold outright
• Rights can form part of
a license agreement or
other type of deal
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What is a Copyright?
“The primary objective of copyright is not to reward the
labor of authors, but to promote the Progress of Science and
useful Arts. To this end, copyright assures authors the right
in their original expression, but encourages others to build
freely upon the ideas and information conveyed by a work.”
John Ramsay
“Technology Transfers and Licensing”
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What is a Copyright?
©
• Exclusive right to produce or reproduce
original literary, dramatic, musical or artistic
works
• Covers the expression of the idea, not the idea
itself
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Why Get a Copyright?
• Protection from unauthorized copying
• Sell your Copyright
• License you Copyright
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Trade Secrets
(Know-How)
Information collected or created by a person
for his/her use and intended to be kept
secret because of some competitive
advantage that the data gives to the holder.
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IP – So…what is it?
Creations of Human Intellect
that are protected by law.
Most of the Time, But Not Always
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Intellectual Property
Corporate Assets
Sometimes Your Only
Assets
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Intellectual property
management has become a new
corporate strategy issue.
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An Effective IP Strategy
Can …
1. Strengthen Market Advantage
2. Improve Financial Performance
3. Enhance Competitiveness
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Using IP as Assets and Business
Tools Can …
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Generate revenue through new products
Generate new revenue through licensing
Boost earnings per share
Seed continuing innovation
Currency for mergers & acquisitions
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1998 Survey by British Technology
Group (BTG)
• 67% of US companies have technology
assets they have failed to exploit.
• On average, 35% of their patented
technology goes to waste because they have
no immediate use for it in-house.
• BTG estimates the value of this “wasted”
technology at $115 billion US.
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The Grim Reality
• <10% of patents recover their costs
• 1 in 800-1000 “disclosures” $1 million
• 1 in 100 “disclosures”  $100,00
• 3 out of every 5 new products will fail
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The Grim Reality
Stanford University
• Cumulative royalties : $455 million US - 2001
• DNA: $255M US
• Equity $20M US
• Cumulative disclosures: 4,400 (since about 1965)
• 1/4,400 is a big winner
• 47% of licenses produce less than $10K per year
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The Grim Reality
You are required to kiss a
lot of frogs before you find
Prince Charming.
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The Grim Reality – It
Can Cost Lots of Money
How Do You Decide
Whether to Invest in
Your Intellectual Property
or Other Things?
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Strategic IP Management
Assumes your company has a strategy
for managing intellectual property
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Managing the IP Portfolio
Managing IP  Managing a Patent Portfolio
Patents are important
but are only one part of
the picture
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Managing the IP Portfolio
R&D
Legal
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Managing the IP Portfolio
“Patent protection takes a lot of work. And time.
And money. The dirty secret is that for many
universities (and companies) – perhaps most – they
are not yet breaking even, much less making
money on the proposition. And in some instances
and some industries, patent protection may in fact
be an oxymoron.”
William Brody, President
Johns Hopkins University 1999
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Managing the IP Portfolio
Converting our (discoveries,
inventions, ideas, prototypes) to
new products, licenses, new divisions
or start-ups while trying to maximize
the $$ value
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IP Portfolio Management and a
Protection Strategy
The goal is to align the
patenting (protection)
strategy with the business
strategy.
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IP Portfolio Management – can
you answer?
• where does your IP fit with respect to the overall
business strategy? Do your employees know?
• what competitive advantage will be exploited?
• what’s your market? Low cost or IP intensive?
• what about your competitors and their patents?
• do investors think your patents are of any value?
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Managing the IP Portfolio Means …
• finding and concentrating your efforts on the illusive 2%
• developing tools that will allow you to evaluate new
discoveries quickly
• filing for a patent when it makes sense
• taking risks, but not stupid risks
• understanding that success depends on the receptiveness
of the market for what you have
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Developing a Strategy
Do an IP Audit
• What have we got? Look around the lab.
• Where are the technology clusters?
• How can we better utilize or exploit what we
already have?
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Tips From the Trenches: What Have
We Got?
“ Technology by itself is of no use to any investor or
licensee because it does not create wealth on its
own. If the product is not strikingly apparent and
well defined, there is no technology exploitation
opportunity. ”
Denzil Doyle
Making Technology Happen
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Tips From the Trenches
What’s the Product?
How Much of it Can Be Sold?
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Tips From the Trenches
Set Limits for ROI
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if potential financial returns do
not exceed certain levels, don’t
waste any more time or money on it.
• check your market and then check it
again
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Does Patenting Make Sense?
• Not every “invention” should be
patented.
• How does a patent fit with your
commercialization strategy?
• How fast is the technology moving?
• Can you recoup the cost and make a
profit?
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Developing a Strategy
Can we better utilize or exploit what
we already have?
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Disclosure and review process.
What gets patented? Patent as you go.
What gets culled and when?
A centralized office or person.
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Developing a Strategy
Internal Issues
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The use of CDA’s
Keeping scientific notebooks
Work for hire contracts
Employment contracts
Getting the word out to employees
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It Never Ends
Active ongoing process
Not something you do and then
forget about it
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Developing a Strategy
Get Professional Help Early!
Budget for it. It will be
money well spent.
Make them part of your
team from the beginning.
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Summary Thoughts
• The need for a Strategic Plan for IP
management for your company
• Managing IP  Managing a Patent Portfolio
• You need to actively manage the process and
your resources
• Concentrate your efforts on finding the 2%
• Set parameters for how much time and effort
you expend on a new discovery.
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Questions
Beverley Sheridan
Technology NOW
(403) 246-5939
[email protected]
www.technow.ca
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The Right Answers to the Right Questions
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