Intellectual Property (IP) Strategies to Consider for Life Sciences Start-Ups
Intellectual property (IP) is one of the most valuable assets a life sciences innovator or start-up has. While these companies are often built on the foundations of successful pre-clinical studies, they face a substantial amount of time between obtaining regulatory approvals and introducing a drug onto the market.
Additionally, hefty investment from external sources is required to maintain their ideas and support eventual development, while also protecting against competitor infringement. However, attracting the necessary capital can be tricky without first obtaining the appropriate protections for your IP.
Here are four key considerations for life sciences start-ups when filing for IP protections.
1. Prioritize IP Protection
Protecting your ideas is essential for any breakout innovator, and establishing ownership over your IP is critical in the beginning stages. This is particularly important in cases where ideas are exchanged and deliberated between two people in an informal setting, resulting in a dual application. Often, agreements are loosely defined in situations where the terms of the relationship and respective ownerships should instead be clearly outlined and enforced.
Rather than placing the ownership of your IP in jeopardy when entering into a joint-ownership company, consider how roles and responsibilities will be allocated, how the company will be divided, what the investment agreements look like, and, if applicable, how the company can enforce its right to its IP.
2. Evaluate Available Protections
Depending on your assets and budgetary constraints, there are several types of IP protection available. Rather than abandoning your IP strategy for the sake of cost savings, you can maximize costs in two simple ways: partner with a global provider that can help you reach further without breaking the bank or create a multifaceted portfolio with different types of protections. The four key types of patent protections are:
Patents are granted by governments and permit the protected sale and use of your ideas for anywhere from 14–20 years. Innovators can either file for a design patent (original designs), utility patent (new process, machine, composition, or improvements), or a plant patent (invention or discovery and asexual reproduction of a distinct, new variety of plant).
There are several stipulations for this: ideas must be new, useful, and non-obvious. It is critical to determine whether your idea or invention qualifies for patent status and in which countries or markets it is required, as patents can be costly to obtain and uphold. Innovators should, however, be careful about obtaining a patent before they publicly disclose details of their ideas, as doing so will render it difficult to file for any patent protection after the fact.
According to the European Union Intellectual Property Office (EUIPO):
Trademarks are signs used in trade to identify products. Your trademark is the symbol your customers use to pick you out. It distinguishes you from your competitors. You can protect and build upon your trademark if you register it. In some countries, you can also get protection even if your trademark is not registered, as long as it is used. However, you are well advised to register it in order to obtain the best protection. The only condition imposed on a registered trademark is that it must be clearly defined; otherwise, neither you nor your competitors will be certain of what it covers.
For example, a pharmaceutical organization seeking to brand a new drug must create potential names that are not too close to an international non-proprietary name, assess existing trademarks with similar names in target markets, and conduct safety research to evaluate the risk of life-threatening confusion during prescription. They must then clear health agency approvals (such as the FDA and EMA); these agencies might also need to assess the name against national regulations and different languages. The process can be complex, so innovators should prepare for all stages to ensure a strong chance of success.
- Designs: According to the EUIPO:
Design protection is an important business asset for companies of all sizes, not just bigger ones. EUIPO’s research shows that small and medium enterprises (SMEs) that own designs have 17% higher revenue per employee than SMEs that do not own any intellectual property rights. Designs are well defined in the European Union.
‘The appearance of the whole or a part of a product resulting from the features of, in particular, the lines, contours, colours, shape, texture and/or materials of the product itself and/or its ornamentation.' —Article 3 of the Design
- Trade Secrets: These boil down to any information that is not public knowledge and is kept confidential, such that its economic value is preserved for the holder and it does not fall into the hands of competitors. Innovators will be expected to keep this information tightly confidential in order to qualify for trade secret status under the behest of the court. Once obtained, this would grant the owner the right to take action against anyone who commits confidentiality breaches.
Life sciences innovators should consider if there is any risk of reverse engineering, if their ideas do not meet criteria to pass USPTO examination, or if they are concerned about ease of infringement identification when deciding between a trade secret or a patent. In all cases listed, it may be more beneficial to file for a trade secret. In life sciences, a heavily regulated sector, in order to commercialize a new pharmaceutical and gain the return on the investment for years and years of research, a patent would be an appropriate type of protection. That is not to say that the method of producing a specific step in the long process of creating a pharmaceutical is not protected as a trade secret, because the expected “life” of that method is much longer than the drug itself.
3. Consider Your Investors
A strong IP portfolio and a demonstrable patent strategy can be the deciding factors in whether potential investors move forward with your company. Investors are expecting assurance that they will receive a strong return on their input. Your IP lends credence to the economic power of your property, and it illustrates how you have an advantage over your competitors. Investors will keep a close eye on your portfolio to assess existing patents as well as pending applications to understand potential future IP states.
4. Research International Protection Standards
Consider international protection standards early on during IP strategizing; otherwise, you might limit your ability to expand globally and put your protective integrity at risk. It is critical that you understand what protections you will require to proceed when entering the international market. Oftentimes, international filing covers 30–40 countries.
In most cases, you will need to translate your materials into one or more languages in order to file in international markets. Handle your translations as another tool in your toolbox to reduce costs. The translation memory from translating texts over the years will allow you to take on 30 to 40 countries with up to 40% savings in translation costs alone. However, outside of translation costs, the long-term expenses associated with maintaining a large portfolio of patents can be debilitating if not carefully considered.
Partner with a global provider, in particular one with a global footprint that can produce around-the-clock customer service. Constantly monitor which maintenance fees you need to pay and when. Also, consider different aspects in your strategy, such as licensing, selling, and buying, that will affect your long-term budget.
Help with Patent Filings
If you are looking to discuss large global patent filing projects and ways to reduce your overall costs, connect with TransPerfect Life Sciences today. We are happy to schedule a call to talk about your challenges and come up with a solution tailored for you.