What Are Some Licensing Options?
Your invention or product can be sold and licensed in a variety of ways through marketing:
- Direct Contact: Get in touch with manufacturers and potential customers directly to introduce them to your invention.
- Trade Shows: Participate in trade shows where you can display your invention to prospective buyers and users.
- Advertising: Purchase advertising space in magazines and business periodicals to expose your goods to consumers and potential customers.
- Patent Websites: Attempt to post on patent websites after doing some research on them in order to promote your innovation.
- Discover Investors: Make contact with potential investors who could fund your product’s launch by investing in it.
How Much Does It Cost to License a Patent
Patent license fees vary depending on a number of factors when applying for and submitting a patent.
The total cost of a patent can range from as little as $65 to as much as $15,000 or more, depending on a number of variables, including complexity, subject matter, relevance, and the kind of patent.
Here, we’ll talk about how much each sort of patent costs, how those costs are affected, and whether or not you also need a trademark.
You’ll note that the genuine cost of applying for a patent is typically quite reasonable throughout this text. The price only goes through the roof when legal fees are involved. Wait until the very end of the article to find out how to save money on those pricey legal expenses.
Even though the type of patent has the biggest influence on the overall cost, other factors can also have a big impact on how much a patent will cost in the end.
The beginning point for the costs is determined by the kind of person or the size of the company applying for the patent. Usually, a person will pay less than a company.
The scope and complexity of a patent application might be influenced by the technology used in an invention.
It is frequently substantially more expensive to patent an innovation with complex technology than one with simpler technology.
The opportunities determine the invention’s entire value it has in the pertinent market.
In order to ensure that the invention is properly protected for commercial reasons, the inventor will often spend more money if the market is strong.
How quickly you can move through the patenting procedure will depend on how original your innovation is.
In order to obtain a patent, an inventor must demonstrate that their innovation is sufficiently original. It will take longer and cost more money to obtain a patent if your patent application is identical to other inventions.
The patent rights’ geographic scope may result in significant additional costs.
For instance, it will cost more money to protect an invention in multiple nations as opposed to just one.
What Are the Steps to License a Patent?
Below are a few steps you can take towards getting a patent license.
Establish a Property Interest in Your Idea
Before attempting to negotiate the sale or licensing of your idea, it is crucial to register it as intellectual property. Wait until you’ve done this before telling anyone about your concept. This entails submitting a patent application, or “provisional” patent application, for concepts that are innovations.
Anyone with a valid patent (or the legal authority to sue for infringement) has the exclusive right to prevent others from creating, utilizing, offering for sale, or commercializing their innovation. You will pay higher licensing fees as a result of this.
Depending on the sector and a number of other factors, patent owners can anticipate receiving a 3-7% royalty on sales of patented or patent-pending inventions. If your innovation is not patentable, licensing is not the best course of action for you.
Still, depending on your circumstances and the nature of the invention, you might be able to receive remuneration in other ways.
Determine Potential Licensees and the Market for Your Invention
You are the ideal person to identify a partner with whom to license your invention because you are the most knowledgeable about its advantages and target market.
By going to trade exhibitions, subscribing to pertinent periodicals and journals, visiting stores, and exploring the internet, you can locate as many businesses in the market for your idea as you can. Keep a record of the names of the companies, the people you spoke with there, their contact information, how you got in touch with them, and the topics you discussed.
You can come across rivals while conducting this search for possible licensees. Learn everything there is to know about your competitors’ products so you can explain to others why your creation is superior to their offerings. Your market knowledge will determine if the deal is a good one, a fair one, or not at all.
Prepare Your Negotiating Materials and Have a Well-Developed Prototype
Who would pay for an idea if they were unsure of its viability or advantages? Nobody. Make the best functional prototype of the innovation you can because the more developed the invention is, the better. Hire a specialist to make the prototype for you if you are unable to do it yourself.
No matter how fantastic your idea is, it will fail if you don’t present it in a credible, focused, and concise manner. Every creator believes their invention to be the best thing the industry has ever seen. To present to potential licensees, prepare a one-page booklet outlining the advantages of your invention and its market value. Make sure it catches their attention.
The potential licensee should receive issued patents. Send the potential licensee a copy of the pending patent application but not the claims.
Suppose prospective licensees have a chance to evaluate the patent application’s claims. In that case, they can utilize the claims to justify a lower royalty or create their own competitive products to avoid violating your claims.
Of course, the claims will be available to the public if your application has already been published.
Unless you specifically request non-publication at the time of filing, publication of non-provisional patent applications occurs automatically 18 months after filing. Do not disclose the application’s file number and date to the prospective licensee if the publication has already taken place.
Provisional patent applications are kept confidential at the patent office and are not publicized.
Make Initial Contact
Send the contacts you’ve identified in your one-page invention brochure along with a cover note reminding them of any previous interactions and asking for a meeting to go over the possibility of licensing it.
It could take some time for prospective licensees at big businesses to reach the relevant people with this information, but stay engaged and keep track of every contact on your list.
It is uncommon for a business to agree to confidentiality, despite the fact that it is preferred to require the potential licensee to sign a non-disclosure agreement. Always remember that everybody you discuss your invention with could be a competition or a potential licensee. Keep a note of the information you supplied to them.
Can I Manufacture and Sell the Patented Invention After I License the Patent?
You may or may not be able to manufacture and sell your patented invention yourself, depending on the type of license you grant to someone. Only the individual you grant an exclusive license or an assignment of your patent rights is permitted to produce and market the invention.
Do I Have to Put My License in Writing?
In order to be legally binding, any assignments of patent rights must be made in writing. All licenses, however, are not required to be in writing in order to be valid.
If a license qualifies as a general contract and complies with all general contract principles, including the Statute of Frauds, it can be oral and still be enforceable.
Any person who violates a patent holder’s rights may be sued in order to have their patent rights enforced. Despite what might seem obvious, suing for patent enforcement requires a valid written patent or provisional patent. An inventor will have various legal rights to enforce their idea or invention over time, and these rights will vary depending on the stage.
Should I Record My Licenses and Assignments?
The United States Patent and Trademark Office (USPTO) is not required to record your licenses and assignments, but you might want to. You cannot sell your license to a secured creditor or sell it to subsequent buyers without recording it. Consequently, even though it is not required, it is probably in your best interest to record your license even though it is not required to do so.
Can I Challenge the Validity of a Patent Licensed to Me?
Generally speaking, once you have secured a license for some of the patent rights, patent laws do permit you to contest the patent’s validity through a patent lawsuit.
Intellectual property-related lawsuits include those involving patents. Most patent lawsuits center on the unauthorized or illegal use of a patent or otherwise protected property.
These legal actions are typically known as patent infringement lawsuits. In most cases, proving patent infringement requires a lengthy process that includes several steps.
Can I Challenge the Validity of the Patent After I Assign My Rights?
A patent that you have sold to another party cannot be contested. It’s known as assignor estoppel.
Should I Consult an Attorney?
You might want to contact a US patent attorney if you have any queries or worries about licenses and assignments of patent rights.
You can get assistance from a patent licensing attorney who has experience with licensing agreements to draft a license or assignment agreement that best suits your requirements. Additionally, a patent attorney can represent you in court if your rights are violated.
