In the life sciences sector, long-term success is dependent on more than innovation alone. To secure funding, enter strategic alliances, and achieve leadership in competitive markets, companies must protect their innovations by implementing a strategic intellectual property (IP) strategy.
Patents should be the cornerstone of any life science innovator’s business strategy. Across biotechnology, pharmaceuticals, medical devices, diagnostics, robotics, AI, digital health, and advanced therapeutics, patents function as currency and leverage. Patents minimize risk in innovations, safeguarding them against competitors, attracting investors, and enabling licensing opportunities. On the other hand, weak or misaligned patent protection can undermine even the most compelling technology during due diligence.
A thoughtful, integrated patent strategy is more than a legal formality for life science innovators. It’s a vital piece of their business.
Attracting Investors and Minimizing Risk
Sophisticated investors view robust patent portfolios as a sign of technical credibility, management capability, and long-term vision. Strategic patent filings signal that a company understands how their innovation can be scaled, adapted, and monetized over time.
Patents are among the most heavily scrutinized assets during financing rounds. Patents can act as a hedge against future risks and uncertainties, allowing innovators to expand, adapt, and explore adjacent markets. For investors seeking to underwrite risk, patents transform early-stage research into assets that create the exclusivity necessary to commercialize in highly competitive markets.
Aligning Patent Strategy with Business and R&D Goals
The most effective patent strategies are not reactive, but rather proactive, and are implemented concurrently with research, development, and investment strategies. When aligned with a company’s business objectives, the protection of IP assets can more seamlessly evolve alongside the innovation itself.
Developing a strategic IP position in conjunction with research and development (R&D) is key to maximizing an innovator’s chances of being awarded commercially meaningful patents. While startups often file initial patent applications early, many fail to file additional applications along the way to cover incremental improvements and changes to their products.
Finding White Space and Securing Freedom-to-Operate
In markets with many competitors, there is less room to innovate. Identifying “white spaces” — the areas of opportunity free of patents within crowded areas of technology — and developing a strategy for patenting technologies within that white space, can be helpful for life science companies trying to gain a competitive advantage.
Conducting a Freedom To Operate (FTO) patent search can help a company determine how crowded a particular area of technology is with competing patents and can forecast what innovations may be used in the future. An FTO analysis will also determine whether a product can be produced without infringing on third-party patents, and identify opportunities of white space to design around competitors’ patents or file patent applications covering improvements to competitors’ technology or products.
By filing patent applications in white space areas, life science companies can stake broad claims to potentially dominate a particular technology landscape.
Fast-Track Patent Applications
In life sciences, timing is everything. The industry is highly competitive and fast-paced, and issued patents are significantly more attractive to investors than pending patent applications. To build up a portfolio of patents more efficiently, early-stage life science companies should consider utilizing the U.S. Patent and Trade Office’s (USPTO) fast-track patent examination programs, including Track One and the Patent Prosecution Highway.
The USPTO Track One program offers expedited examination of patent applications for a fee, striving for a final decision on whether a patent will be granted or not within one year. Alternatively, companies can pursue a patent by utilizing the USPTOs Patent Prosecution Highway, which accelerates the examination process for a U.S. patent application if a corresponding patent was already approved or issued in another country.
While these options require higher costs upfront, they allow an innovator to quickly obtain issued patents to cover key technologies and products, which can be critical for attracting investors and creating a barrier to entry for competitors.
Building Global Value Through International Patent Protection
Because life science markets are global, it is important for innovations to be protected internationally outside the United States (U.S.). While expensive, strategic international patent filings are essential for accessing key commercial markets and for creating barriers for competitors abroad.
The Patent Cooperation Treaty (PCT) allows an innovator to file one international patent application that provides protection in 157 contracting countries, while delaying filing costs in specific countries for at least 18 months. This flexibility gives companies an opportunity to assess market potential and competitive dynamics before committing to significant foreign filing expenses.
Life science companies should focus their filing efforts on foreign countries with large markets for their products or where competitors’ manufacturing facilities are located. Filing patents in the major markets of the U.S., Europe, China, and Japan, are the most common. If market projections and budgets allow, filing patent applications in India, Brazil, the Middle East, and additional Asian countries can be considered.
Patents as Tools for Licensing and M&A
Patents offer more than protection and barriers to entry for competitors. Patents also open doors for potential licensing opportunities and acquisition.
Licensing patents can significantly strengthen a life science company’s IP portfolio. Out-licensing can extend market presence and provide an additional revenue stream for an innovator. Alternatively, in-licensing early-stage technologies from universities or research institutions can help build patent portfolios and provide companies with access to the early technology, data, and patents they need to compete in the marketplace.
Similarly, cross-licensing with competitors can enhance patent portfolios by providing innovators with FTO in crowded technology areas. Companies can opt to pool patents and divide the rights among themselves. In this case, each party gains exclusive rights to a particular field covered by the patents. Cross-licenses can lower licensing fees and promote greater innovation.
Patents also boost the value and negotiating position of a company during merger and acquisition (M&A) deals. IP is a key driver in M&A, and buyers consider elements such as number of patents in a portfolio, protection around core technologies and later improvements, opportunities for licensing, and geographic scope. A well-constructed and thoughtful patent portfolio adds credibility and demonstrates innovation, competitive advantage, and revenue opportunities for investors, partners, and buyers.
Avoiding Unintentional IP Loss and Managing Confidentiality
A common pitfall for early-stage life science companies is inadvertent disclosure of innovations too early. Public disclosure of any kind can jeopardize patent rights and reduce competitive advantages. A key consideration is to file a patent application before any public disclosure including speaking at conferences, publishing papers, discussions with investors or potential partners, posting on websites, or launching a product.
In most countries outside the U.S., public disclosure of an innovation may violate a requirement of absolute novelty necessary to obtain a patent. The U.S. offers slightly more flexibility, allowing a grace period of up to one year to file a patent application following the first public disclosure of an innovation.
It is strongly advised that life science companies manage confidential information and safeguard ownership of all IP by implementing invention assignment agreements, non-disclosure agreements, and employee handbooks outlining expectations of employment, including confidentiality and patent ownership.
Managing sensitive information related to patents, trade secrets, and other proprietary information can provide long-term protection and competitive advantages.
Extending Patent Life and Maximizing Commercial Exclusivity
Life science companies should consider the term of a patent when strategizing commercialization, as well as the common regulatory delays in the industry. Over 60 countries worldwide provide some form of extension options for medicinal product patents, though the scope and requirements vary by jurisdiction. In the U.S., patent-term extensions (PTE) can extend the life of a patent due to Food and Drug Administration (FDA) delays, and patent-term adjustments (PTA) account for USPTO delays during patent application prosecution. Many countries around the world offer similar extensions. By strategically leveraging these offerings, life science companies can extend exclusivity and maximize the long-term commercial value of their inventions.
Conclusion
Patents are vital to the success of innovators in the life sciences industry, and a strategic strategy that is aligned with R&D and long-term business objectives provides companies with a competitive edge to gain market share and attract investors in a crowded marketplace.
In an industry where the stakes are high and the path to commercialization is long, intellectual property remains one of the most powerful tools innovators have. Early strategic planning with your patent attorney can help maximize your chances of being granted commercially meaningful patents.
About the Author
David J. Dykeman is co-chair of Greenberg Traurig’s global Life Sciences & Medical Technology Group, and co-managing shareholder of the international law firm’s Boston office. A registered patent attorney with more than 25 years of experience in patent and intellectual property law, he focuses on securing worldwide IP protection and related business strategy for high-tech clients, with particular experience in life sciences, medical devices, robotics, AI and information technology. Dykeman provides strategic patent portfolio development and IP advice for clients including major research institutions, multi-national corporations, and startup companies. He can be reached at dykeman@gtlaw.com.
