MX: How To Develop A Strong Patent Portfolio

Posted by rpark on January 19, 2012

Monitoring competitors’ IP is a critical aspect of a sound medtech patent strategy.

In the competitive medtech IP environment, a strong patent position may represent the lifeblood of a company. To attain that position, a medical device company cannot build its patent portfolio in a vacuum. Instead, a patent strategy must include a system to obtain information about competitors that can then be used to the company’s advantage. This system must track a competitor’s products so that the company can craft patents to cover those products, thereby building business leverage and increasing the company’s value. The system also must track a competitor’s patent publications so that the device company can avoid obstructive third-party patents, evaluate the need for licenses, and enter the market with the least amount of risk.

Medical device company executives should understand the importance of a strong patent portfolio as well as ways to obtain information on a competitor’s products and patent publications in order to devise strategies to best use that information. The path for achieving those goals is addressed below.

A Strong Patent Portfolio

As noted, medical device company executives should not underestimate the patent portfolio’s value as a business asset. Patents grant a right to exclude others from making, using, selling, or importing the patented technology. It is important to note, however, that patents do not grant the right to practice that technology, as another party’s patent may block that right. Patents therefore protect revenue and investments in R&D and regulatory activities by preventing or enjoining competition. In addition, a strong portfolio can prevent a competitor from receiving financial backing, forcing it to cease its business or to move in a different technical or market direction.

Patent portfolios also generate revenue through licensing fees, infringement litigations, and outright sales of patents. Often a patent portfolio covers more than one medical or nonmedical field outside the patent holder’s market. In such a case, the portfolio can generate a revenue stream through field licensing. In addition, venture capital groups and other investors scrutinize the patent positions of the device manufacturer and its competitors when making investment decisions. They look to see whether the product has patent coverage so that no one can copy it and that no patents cover the product, permitting the manufacturer to go to market. Competing financing decisions are often made based on which company has the stronger patent position.

Perhaps the most important aspect of a strong patent portfolio is its use as leverage. Because a successful medical device company inevitably will face patent obstacles from competitors, the company must have bargaining chips at its ready for cross-licensing or partnering, such as a strategic alliance, a joint venture, or other collaboration.

Obtaining Competitors’ Information

To help build leverage, a medical device company should track its competitors’ issued patents and published patent applications in both the U.S. and abroad. The company should generate a list of potential competitors, inventors in the field, and key technical words or phrases that may be found in the patent publications. The company then should perform regular searches of databases at patent office Websites, including the sites of the United States Patent & Trademark Office (USPTO) and the European Patent Office (EPO) as well as on and other commercial search engines. The patent publications may be downloaded from those sites. Regular searches of comprehensive, subscription-service databases of worldwide patent publications, including the Dialog and Derwent World Patent Index databases, offer results that can be automatically forwarded.

In addition to patent information, a company must track its competitors’ products. The best sources of that information include the competitors’ patent literature, as technology disclosed in a patent application often mirrors their product development; competitors’ Websites; trade shows, conventions, and other industry meetings; press releases, which may be monitored through internet services; and publications relating to clinical and FDA submissions.

Using Competitors’ Information

Armed with information about its competitors’ patents, a company should develop “defensive” and “offensive” strategies relative to the competition. Defensive strategies help a device company avoid a competitor’s claimed patent rights; offensive strategies help a company obtain patent rights in order to exclude competitors.

Defensive Strategies. A company should review its competitor’s patent claims for ways to avoid the claimed technology. Engineers and patent counsel should hold regular meetings in order to brainstorm ways to design around the claimed technology. These “design-arounds” themselves may be inventions worthy of patent protection.

If an alternative design is not an option, the company should attempt to obtain rights through a license or other purchase. Licenses can take many forms. They can be exclusive, nonexclusive, royalty-bearing, or non-royalty–bearing. They can also be field-restricted—especially if the technology is not the core of the patent owner’s market—or cross-licensed, if the device company has built patent leverage relative to the competitor’s product development.

Another defensive strategy includes instituting proceedings that challenge a competitor’s patent. In the United States, for example, such proceedings include patent reexamination and soon-to-be-available post-grant and inter partes review. In these procedures, a device company can request the USPTO to reevaluate the patentability of a competitor’s issued patent claims. This can be a less expensive alternative to litigating that matter in court. Many foreign patent offices have similar procedures. For example, the EPO has a procedure in which a company may oppose the grant of a European patent within nine months of that grant, also based on prior art. Therefore, it is important to closely monitor the grant of a competitor’s patents so that this option is not lost due to the passage of time.

Offensive Strategies. Using the information obtained about competitive products, a company should craft patent claims to cover those products. To do so, the company should review the disclosures of its applications pending in the patent offices in order to see whether those disclosures will support patentable product claims. The company also should have its engineers invent products based on the anticipated direction of its competitor and file new disclosures with claims focused on anticipated commercially significant features that block a competitor’s ability to practice in that direction. These strategies build significant leverage and bargaining chips.

The most aggressive offensive strategy is enforcement of your patent through an infringement action. As with other court actions, this option must be carefully considered because of its cost, risk, potential reward, and possible drain on company resources, including money and employee time.

Maintaining Profitable Markets

Medical device companies are at the forefront of innovation. Their technologies can save lives and improve the quality of healthcare for countless people. But maintaining success through product cycles can be difficult, especially when competitive and regulatory concerns plague the industry. Effectively obtaining and using competitive information to build a strong patent portfolio can help to reduce or prevent competition and maintain profitable market shares.
Les Bookoff is a patent attorney in Finnegan, Henderson, Farabow, Garrett & Dunner, LLP (Washington, DC). He can be reached at







Dinesh Melwani is a patent attorney in Finnegan, Henderson, Farabow, Garrett & Dunner, LLP (Washington, DC). He can be reached at

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