An important element of patent portfolio management involves assessing the value of issued patents. After all, if you don’t have some idea about what a patent is worth in the context of your business or industry, it’s hard to make strategic investment decisions about your intellectual property.
Patent valuation is determined by three critical drivers: legal strength, technology strength, and commercial value.
Legal strength: This analysis looks at the core fundamentals of a patent to determine how well positioned it is to stand up to legal challenges, or as a basis for making legal challenges to third-party patents.
Technology strength: By analyzing a peer group of patents within the respective technological concept, you can determine how active and innovative the market is, and how novel your patent is relative to that activity.
Commercial value: Statistical models can help you to calculate the projected size and economic value of the market that’s protected by the patent. From there, you can determine the economic patent value based on the product’s potential market share.
Viewing these metrics individually and collectively can help patent reviewers make more insightful decisions about patent applications, as well as identifying third-party patents as potential targets for licensing or acquisition.
Not every patent will be a winner. But a more informed approach to understanding the value of each can help you weed out the weaker candidates and invest in those with the most commercial potential.