“ New ways of identifying potential partners ” Charles Timoney October 14th, 2014

2 – INTRODUCTION Having decided to enter into an active licensing programme, you are faced with the problem of how to identify potential partners and how to contact them. I propose to examine some, hopefully, new ways of identifying potential partners.

3 – NEW WAYS OF IDENTIFYING POTENTIAL PARTNERS (1) “Inventor of the Month” awards: -A good opportunity to obtain valuable commercial information from the inventor himself, or his superiors, which may enable possible partners to be identified.

4 - NEW WAYS OF IDENTIFYING POTENTIAL PARTNERS (2) Your own supplier of patented products: -If the product in question is not strategic, you can offer a license to your own supplier in order to allow him to broaden his market. -In some cases, this may also reduce the product price to your company in view of the higher production quantites. -It is important that your database shows those patents which are exploited for your company by outside suppliers.

5 - NEW WAYS OF IDENTIFYING POTENTIAL PARTNERS (3) Provide a procedure for the payment of a bonus for infringement detection: -A bonus is payable to any person (inventor or not) who detects an infringement by a third party of one of your company’s patents. -The infringement has to be confirmed by the IP department; -An approach can then be made to the infringer, offering a license; -The bonus is paid, even when no approach is made to the infringer

6 - NEW WAYS OF IDENTIFYING POTENTIAL PARTNERS (4) Patents destined to be abandoned: - Some patents in specific fields, which are no longer of interest to the company and are therefore destined to be abandoned, might nevertheless be of interest to third parties; - For such patents, possible licensees can be identified by checking those patents against which your patent has been cited (preferably in category X or Y); - This only really applies to groups of patents; - Offer them to potential partner, explaining that they relate to a field which you know to be of interest to them;

7 - NEW WAYS OF IDENTIFYING POTENTIAL PARTNERS (5) “Citing patents”: - This idea makes use of external databases to identify potential licensees; - Select your own patent portfolio in the database (eg Orbit); - Select those third-party patents against which any of your patents have been cited as X or Y; - Collate these third-party patents by Applicant, and then in order of quantity; - Contact the companies in question

8 TO WHOM SHOULD YOU SEND YOUR OFFER? - Ideally, to the IP specialist who deals with Licensing; - Identify him from lists of Patent Specialists; - Or from the representative shown on published patents (or via their Patent Attorneys); - Lists of members of societies such as LES

9 WHO ELSE SHOULD YOU SEND YOUR OFFER TO? - The corresponding person to your Technical Expert; - Your Technical Expert may be able to identify a suitable contact person; - This gives a “two-pronged” approach which may be more effective

10 WHAT DO YOU SEND TO THE POTENTIAL LICENSEE? - Nothing which could be construed as being a threat; - At least the patent (in an appropriate language); - An indication of how the invention may be of interest; - Commercial and technical information where available; - Details of the actual device, if available

11 WHAT ELSE MIGHT BE USEFUL FOR THE POTENTIAL LICENSEE? - The potential advantages for him in using your IP; - It is important to look at the IP from the potential licensee’s point of view

12 SELLING THE PATENT(S) In some situations, it can be advantageous to transfer ownership of the patent(s) rather than make it the subject of a license agreement

13 SELLING THE PATENT(S) - 2 Possible reasons for a sale: - The projected royalties are too small; - The two companies are of widely different sizes; - There is only one patent in question; - The parties have been unable to reach agreement on the terms of the License; - The Licensee needs an exclusive license but is unwilling to pay the higher fees

14 LICENSE MANAGEMENT – (1) - Your in-house patent database should indicate that a patent is the subject of a license; - This ensures that the patent is not inadvertently abandoned; - The database has to be kept up to date

15 LICENSE MANAGEMENT – (2) - It is useful to have a database for Contracts; -Ideally, this should store each successive version of the contract

16 LICENSE MANAGEMENT – (3) - The Licensor has to obtain the correct annual sales figures from the Licensee, or, alternatively: - The Licensee has to provide the correct annual sales figures to the Licensor – this is not always easy;

17 LICENSE MANAGEMENT – (4) - The Licensor has to determine to which budget the royalties are to be credited; - The Licensee has to determine which budget will be responsible for paying the royalties; – This is not always easy!

18 Any questions?