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Develop your IP strategy

Developing a successful IP Strategy - key actions

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Your IP strategy should support your overall business objectives. To protect your IP and create opportunities for it's successful commercialisation, you will need to take these steps. 

2a. Identify business objectives and key markets

Before developing your IP strategy, consider your business proposition:

  • What are your key commercial objectives for the next 5, 10 and 25 years?

  • Do you need any third party funding or expertise to achieve those goals?

  • What is the value to consumers of the products or processes you intend to market – does it lie in a new technology or an improved product design?  

  • Where are your key markets both in terms of sales as well as R&D and manufacture?

 

Your answers to these questions will form the foundation of a successful IP strategy.

2b. Consult a specialist IP adviser

IP laws are detailed and complex. A specialist IP adviser can help you create a successful IP strategy.  Depending on the nature and aims of your business, people you may wish to consult could include solicitors, patent attorneys and/or trade mark attorneys

 

Consulting IP advisers at an early stage will also help to avoid common (and potentially costly) pitfalls such accidental disclosure of confidential information relating to technology that could have otherwise been patented, or issues around ownership of IP.

2c. Bring key decision-makers on board

Speak to the key decision-makers within your business to explain the importance of IP to the success of your business and to agree your IP priorities.  Your strategy is more likely to succeed if it is supported by the company's directors, chief scientific officer, head of R&D, in-house counsel and finance director.  It's likely that these stakeholders will want to know:

  • how IP rights can be used to prevent third parties copying your products and processes and/or to generate money through funding, investment and/or licensing opportunities;

  • what type of IP protection is available for your business in key markets;

  • how long those IP rights will last and how much they will cost to obtain and maintain.

 

Agree a realistic budget for IP protection, commercialisation and enforcement and keep this under review as you develop your offering. This budget may need to be adjusted if, for example, you devise additional inventions which need protecting or you discover that a competitor is using similar technology and you wish to enforce your IP against them.

2d. Invest in a suitable range of IP rights

A sensible IP strategy is one in which you invest in IP rights that suit your particular products or technology. Some medical devices like insulin injector pens, for instance, are best protected by a range of IP rights including patents and registered design rights, to prevent third parties from copying both the internal mechanisms and external appearance.  On the other hand, many biotech start-ups will rely almost exclusively on trade secrets and patent protection at least in the early stage – branding of such products becoming more relevant further down the lifecycle of the company.  Your IP advisers will be able to advise on the most appropriate combination of IP rights for your products and/or services and at different stages of your company's lifecycle.


It is good business practice to scope out regularly and as far as possible what your competitors are doing and to determine what technology they are protecting through the patent system.  This may not only inform your product development and what you yourself should be protecting but it should also help to avoid infringing third party patents by enabling you to design around if your technology is close to what has already been protected.


If you are entering a new industry sub-sector, you may wish to consider commissioning a "patent landscape report" (PLR) which will give you an overview of third party rights in a specific technology, either within a given country or region, or globally.  This is to reduce the likelihood that you inadvertently develop products and processes that would infringe third-party rights.  It could indeed shape your R&D strategy and assist in the assessment of whether your inventions are likely to be patentable.  A selection of PLRs can be accessed here.  


In parallel, and before launch, it is best practice to conduct a freedom to operate (FTO) search to identify any potential third party patents and patent applications that might be a potential barrier to commercialising your technology because it might lead to IP infringement claims against you.  Another option is to conduct a patent and publications search for the purposes of determining the likelihood that your technology will be patentable.  


None of these searches are strictly necessary before applying for a patent but they are helpful in guiding strategy and can help to reduce overall costs. The amount of due diligence that may ultimately be conducted, particularly during the early stages of a life sciences business, may be quite limited as budgets tend to be quite tight.  It is, however, well worthwhile giving careful thought as to how best to allocate budget to invest in a suitable range of IP rights.  We would recommend that you seek guidance from your IP advisors as to the most appropriate and cost-effective search strategy in light of your specific business needs.


Depending on the results of such searches, you may wish to design around a patent or design, license-in the relevant IP or apply to revoke or oppose the relevant IP right(s).  These searches should be repeated before launching your product or service, as the life sciences industry is fast moving and much can change in a relatively short period.
 

Ideally, you should review your IP strategy, existing portfolio and licensing opportunities with your IP advisers each time a new product/process, or an improvement to an existing product/process is devised, in order keep it in step with your developing business plans.  This may involve, for example, applying for additional patents to protect new inventions, or assigning or licensing-out patents which you no longer require so as to monetise them, or indeed licensing-in technology.

2e. Ensure key agreements are in place

Make sure employment contracts specify that the company will own any IP created by employees in the course of their employment and that they include robust confidentiality clauses. Similar agreements should be put in place in respect of company directors.  Where you engage consultants, you will also need to put in place appropriate agreements covering remuneration and ownership of IP.
 

Ensure non-disclosure agreements (NDAs) are in place with employees and third parties to avoid unwanted disclosure of your inventions and trade secrets. Sample NDAs can be found on the Gov.uk website.

2f. Check the novelty of your invention/design

It is important to understand the hurdles that must be met in order to obtain a patent. Two key requirements for patentability are that your invention must be new and inventive.    


A patent attorney will consider with you what may constitute an invention and be potentially patentable prior to filing any patents.  They will often coordinate patent searches (as mentioned in 3. above) to assist in this by considering what other similar technology is already covered by other patents or patent applications.  PLRs (mentioned in 3 above) may also assist with this process.
 

Alternatively, a patent application can be filed speculatively (without the benefit of such searches) and the application be withdrawn before publication if the examiner identifies prior art documents that call into question whether the invention is new and inventive.  A refined patent application could subsequently be filed to address the issues identified by the search conducted by the examiner.  
In the case of registered designs, the design must be new and possess individual character.  Searches may therefore need to be conducted by your legal advisors before registration is sought.

2g. Keep accurate records

Record each stage of any product design process, dating when key concepts and parts were created and by whom.  Such records can be useful, for example in the event that you are sued for patent infringement and you need to prove that you came up with an idea before a competitor, or if you are accused of copying an unregistered design and need to show that you came up with your design independently without any copying.

2h. Register IP transactions

IP ownership can also give rise to licensing and collaborative opportunities. For example, many successful drugs are manufactured under a patent licence, which can bring substantial income to the owners of such rights. Consider whether your business can exploit any such opportunities, and if so, engage key-decision makers and IP advisers to take this forward. 
 

It is highly advisable to register transactions in patents, trade marks and registered designs, as certain rights are dependent on registration.  For example if a patent assignment is not registered within six months, the purchaser can lose its legal rights (in certain circumstances) and its ability to recover its legal costs if it sues for infringement.  You should therefore consult with your IP advisers before entering into IP transactions to determine whether there are any registration requirements, and consider which party should be responsible for paying the costs of such registration.

2i. Be prepared to enforce your rights

Owning IP rights can act as a deterrent to third parties who may be seeking to use or develop technology or products that are the same as, or highly similar to, yours, but only if you are willing to enforce them.  If you suspect your IP rights are being infringed, it is therefore essential to speak to a solicitor who will be able to advise on various different enforcement options.  


Delay or failure to take action can lead to infringing goods entering the market, which may decrease your market share and send a wrong message to competitors that you are "weak" when it comes to IP enforcement.


While enforcing IP rights through litigation in the English courts can be costly, there are various more cost-effective ways of enforcing your IP rights, such as:

 

  • Sending cease and desist letters to infringers at an early stage.

  • Reporting IP infringements on online marketplaces, for example through eBay's VeRO programme.

  • Putting watch notices in place with UK and EU customs authorities, to provide them with intelligence to enable them to detain suspected counterfeit goods.

  • Negotiating a settlement with the infringer and/or entering into licence or co-existence agreements as appropriate.

  • Alternative dispute resolution, such as mediation or arbitration.

 

Care must be taken when threatening another party with litigation, as certain threats are considered "unjustified" and can lead to legal sanctions against the party making the threat.  A solicitor will be able to advise on the best way of approaching a party you suspect of infringing your IP.
 

If litigation is necessary, you will need to engage key decision makers such as directors and in-house counsel at an early stage in order to identify your objectives and set a budget.  You will also need to instruct specialist solicitors who are experienced in conducting IP litigation and regularly consult with them in order to give your business clear expectations as to the timetable, costs and strategy for the case, and keep these under review. 
 

In the High Court, the stages of litigation are generally as follows (assuming the case does not settle): 

  1. One party issues its claim and the parties set out their respective cases in "statements of case";

  2. Both parties disclose any relevant documents, whether these support or hinder their case;

  3. Both parties exchange witness evidence on issues of fact;

  4. Both parties exchange expert evidence on any issues requiring an expert opinion – in patent cases, experts will often be academics in science or engineering fields;

  5. The case proceeds to trial;

  6. Judgment is handed down, with an order setting out the remedies of the winning party ; and

  7. The parties may apply to appeal the decision to the Court of Appeal if dissatisfied with any aspect of it.

 

No two cases are the same, and many unexpected events can happen on the road to trial.  As such, there can be a lot of uncertainty surrounding litigation steps and the exact cost of litigation.  Depending on the number and nature of IP rights involved, the entire process can cost anything from around £100,000 to several million pounds.  Your solicitors will be able to advise on how best to control the cost and speed of court proceedings and to align these as far as possible with your business objectives.

This project was joint-funded by the National Institute for Health Research (NIHR) Brain Injury MedTech Co-operative based at Cambridge University Hospitals NHS Foundation Trust and University of Cambridge. The views expressed are those of the author(s) and not necessarily those of the NHS, the NIHR or the Department of Health.

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