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Patent Valuation

We take a patent-based approach to valuation using between 10-25 patent-related criteria that will provide you with a measure of the value or strength of your patent or patent portfolio.

The algorithm we use for patent valuation differs from those that economists or finance practitioners use (e.g., market, cost, or income-based patent valuation). What we use instead are patent parameters that patent lawyers understand very well.

 

Advantages of a Patent-based approach to valuation

  • Uncover insights that can only be derived from a deep analysis of valuation parameters derived from each patent
  • Puts patent lawyers in an ideal position to determine the strength of the patents or patent portfolios because of their familiarity with the patent parameters.
  • Allows patent practitioners to classify or determine the best course of action for each patent (sell, license, etc)
  • Provides a perfect complement to mainly economic or financial approach to patent valuations that are prevalent in the market

 

The specific combination of patent valuation criteria that we use may vary depending, for example, on the availability of data for a given criterion. We may also select a set of criteria for use in a valuation based on a client’s objectives (e.g., for patent acquisition or licensing) or requirements.

 

Criteria Used

Primary

  • number of independent claims
  • total number of claims
  • number of forward citations
  • patent term
  • scope/breadth of independent claims
  • number of related art (can be estimated from a preliminary search)
  • number of backward citations
  • number of countries in which patent for invention has been granted
  • number of countries and countries in which patent for invention was invalidated
  • number of times patent survived invalidity or claim cancellation proceedings or litigation
  • whether invention is pioneering or groundbreaking
  • whether inventors are leading figures or known experts in the field of the invention
  • whether subject matter/field of the invention relatively new
  • whether patent claims include narrow claims that cover commercially desirable embodiments of the invention
  • support for the claims in the specification (written description and enablement)

Others

  • whether invention is in a technology area with rapid or slow rate of obsolescence
  • whether assignee has a strong patent litigation track record (e.g., prevailed in most, if not all, of the cases assignee was involved in or very few or none of patents owned by assignee have been invalidated)
  • whether invention is one that requires significant R&D investments to develop, substantial capital and infrastructure investments for commercialization, high production costs, or in a technology area in which manpower is limited or expensive
  • whether patented invention is an essential component or comprises a feature or functionality of a core-technology area or widely-used products
  • whether patent is a standard-essential patent
  • whether patented invention is a dominant or most-widely adapted technology, if there are several competing technologies
  • whether patented invention has been licensed to several large or well-known companies for several years
  • whether patent is owned or has been acquired by a large or well-known company or institution
  • whether prosecution history shows patent application underwent rigorous examination
  • whether assignee is a major supplier of a critical component of a widely-used product, device, or core technology
  • whether technology covered by patented invention predicted or expected to be superseded by new technology
  • whether assignee owns other related patents (e.g., for use against another party in a patent infringement counter-suit)

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