How to Identify & Benchmark Intellectual Property Assets
- June 11, 2021
- Posted by: C.G. Moore, Ph.D.
- Category: Blog
Determining the actual present and future impact — and hence “value” — of intellectual property (IP) has always been fairly subjective since often the IP foreshadows commercialization. As such, when identifying a possible target for M&A or licensing, how can you know with any certainty whether the IP underpinning the platform is valuable? And if so, how valuable? These are only a few of the questions that should be asked about IP and that may provide some useful information when determining what analytical measurements should be used.
- How valuable is my portfolio?
- Where is the value in my portfolio?
- How valuable is the other side’s portfolio?
- Where are the strengths & weaknesses?
- Where do the technologies overlap?
- Should we pursue a deal?
- How do we even define “value,” anyway?
The usual process of identifying important aspects of intellectual property is subjective. There is not one approach to solidifying the process, and it can change based on what is determined from using analytics. The value of Intellectual Property can be influenced by, i.e.:
- And, obviously, the market or potential market
Because of all of these overlapping interests, it can very often be difficult to identify what the value of a product or process will be. Data analytics, including artificial intelligence, should not be a complete substitute for the “usual process” to make predictions about the value of an IP portfolio. Instead we recommend using analytics to test the “usual process” against some analytical metrics to see if the subjective value prediction matches up.
Ways that analytics can assist in a “usual process”
- Facilitating communication with stakeholders
- Process and analyze large volumes of data
- Compare strengths and weaknesses
- Generate understandable results
- Uncover new insights
- Test assumptions.
Analytics is not a substitute for your own due diligence. It is important to remember that technology does not have access to all relevant information and can be limited:
We have found the analytical benchmarks provided by LexisNexis® PatentSight® useful to monitor current research and patents in the same field:
- Measures the importance of the invention for technical development. It is calculated based on the number of worldwide prior art citations received from later patents.
- Indicates the size of the global market protected by a patent family. An invention has a higher business value if the patent rights cover more international markets.
Competitive Impact (CI):
- Estimates how much business value a patent has. It is based on the combined effect of the Technology Relevance and the Market Coverage (measured as the size of the markets in which valid patents and pending applications exist, relative to the world’s largest market – the USA) of a patent.
Patent Asset Index (PAI):
- The aggregated Competitive Impact (sum) of all patents in a portfolio.
To put into practice the above stated information, we provide the following example to assess the analytical value of various companies involved in LIDAR & Autonomous Vehicles:
- LIDAR and autonomous vehicles search strings
- LIDAR, light detection and ranging, LADAR, laser detection and ranging
- Autom* (automobile, automotive, automatic, etc.)
- Driv* (driver, driving, driverless, etc.)
- Vehic* (vehicle, vehicular, etc.)
- Maneuv* (maneuver, maneuverable, etc.)
- +Autonomous (autonomous, semi-autonomous, etc.)
- ((light =NEAR5 radar) OR (light detection =NEAR2 ranging) OR (laser detection =NEAR2 ranging) OR lidar OR ladar) AND (autom* OR driv* OR vehic* OR *autonomous)
The LIDAR/Autonomous Vehicle field has grown significantly since about 2012:
Next, we observed how the LIDAR/Autonomous Vehicle field is divided into “Technology Clusters,” which are categories defined by unsupervised machine learning:
- The field is encompassed by five “technology clusters” with multiple subcategories within each cluster.
- Each cluster has four different levels.
- This is one way to identify IP for further analysis or for limiting further searches.
After determining how the field is divided, one can identify the owners of the intellectual property and the relative value of different portfolios:
The figures above show the number of patent applications and patents (“Number of Rights”) as well as the External Patent Asset Index (ePAI). Recall from above that PAI is aggregated Competitive Impact (CI) of all patents in a portfolio, while CI reflects the combined effect of Technology Relevance and Market Coverage. External PAI omits self-citations by the patent owner and reflects only citations in third-party patents.
We can also add another dimension to the information shown above, to observe trends in the number of patent rights and ePAI over time.
These kinds of analytical tools allow us to compare competitors in the field. The size of the bubble relates to portfolio size and value, and the position on the y-axis reflects overall quality (CI) or degree of innovation (TR). So the higher the location on the graph, the more likely the asset is trending in market importance/market dominance at that time.
The graph below shows how significant LIDAR/Autonomous Automobile IP has become, over time, for a number of different companies. For example, this field involves about 46% of all Uber patent families.
We are also able to determine what categories /patent classifications are the most active areas of innovation for each company:
We are also able to determine which patent owners are collaborating in any given field, and the number of patents that they have obtained together.
We can also observe the different inventors for each company, the number of patent rights associated with each inventor, and their contribution to different measures of value.
Intellectual property analytics is a robust and versatile tool that can provide results rapidly to users. It facilitates iterative processes and can be tailored to the user’s specific needs. Analytics can be used in many different ways, such as for M&A, licensing, defensive planning, and strategy sessions. Analytical tools such as LexisNexis® PatentSight® described above can provide large amounts of useful and reliable information quickly and easily, which can speed negotiations and help the user make better decisions. While analytics is extremely helpful, users should remain aware these tools are a “lens” for observing data, and there are limitations. The “lens” could be distorted, and results should always be tested against other sources of information. Nor should subjective considerations be ignored.
MMV IP is a boutique law firm that strives to provide efficient and streamlined services to clients at a reasonable cost. Within our firm, we provide three major services that include:
Patent Prosecution & Counseling:
Our experience ranges from consultations during the initial phases of product development — e.g., helping to identify likely candidate inventions for patent protection — to obtaining patent rights, and defending those rights before the USPTO Patent Trial and Appeal Board (PTAB) or challenging the patent rights of others.
We routinely assist clients with large- and small-scale product development efforts to minimize the likelihood that their conduct would result in the infringement of a valid claim of a third party patent. We are also well acquainted with patentability issues involving natural products and phenomena in view of the United States Supreme Court’s Myriad and Sequenom lines of cases.
Post Grant Proceedings:
Once a United States patent has issued, it can be challenged at the USPTO by filing a request for ex parte reexamination of the patent, or by initiating an inter partes dispute such as a request for post-grant review, inter partes review, or (for certain kinds of patents) a covered business method patent review.
Additionally, a patent owner may request that the USPTO “consider, reconsider, or correct information believed to be relevant” to the patent owner’s patent via supplemental examination.
Our firm’s trademark attorneys work closely with companies all over the world to develop and implement branding strategies for trademark protection. We offer comprehensive trademark prosecution and counseling services, including:
- Trademark clearance searches and opinions
- Trademark application preparation and filing
- Office Action responses
- Statements of Use
- Coordination with foreign counsel for trademark protection abroad
- Drafting and negotiation co-existence agreements
- Docketing and monitoring declaration and renewal deadline
- Enforcement and TTAB Proceedings
Our Firm is made up of two completely paperless offices, nine attorneys (six PhDs; 2 MDs) and three Patent Agents (all with PhDs) and focus on:
- Chemical Engineering
- Medical Devices and
The key to our value-adding strategy is the link between our highly-qualified patent professionals and our use of cutting edge technology.