IP software for a cost-driven world

In today’s highly competitive world, companies are faced with the triple challenge of constantly having to be innovative in order to survive, shrinking budgets for research and development, and keeping up with the ever-changing costs of obtaining patent protection across the globe.

This has resulted in the need for accurate, user-friendly tools which estimate the costs of obtaining and subsequently maintaining a patent portfolio, in order to facilitate strategic decision-making and budget-forecasting.

Estimating costs can be a challenging and time-consuming task. The costs generally have three components (official, associate/attorney, and translation) that are spread across the different stages of the patenting process (filing, examination, prosecution, grant, and maintenance/renewal/annuity).

Official fees to be paid for a patent application vary widely across countries, and depend on variables such as the mode of filing, type of applicant, number of pages, number of claims, independent claims, and number of pages of sequence listing (for biotechnology inventions). Moreover, applications cannot be directly filed in foreign countries, thus necessitating the appointment of a local attorney or agent. Most attorneys work on an hourly basis, and fee schedules are generally not available online.

Several countries’ legislation require translations at various stages. Four of the top ten patent offices (China, Japan, South Korea, and Russia) require translations into their official language at the time of filing and prosecution. Similarly, 17 of the 38 contracting states of the European Patent Office require a translation of the complete specification at the time of validating a granted European patent, while some states require a translation of only the claims. Translators can charge on a ‘per word’ or ‘per page’ basis, thus adding to the complexity.

"Our research team has studied legislation, costs, and timelines in more than 150 jurisdictions across the world and is constantly on the lookout for changes."

The total cost also depends on the number of office actions (or examination reports) issued during prosecution and the responses that have been submitted.

Finally, the year from which a maintenance fee needs to be paid and the frequency of payments vary from one country to another. For example, a maintenance fee is not required in India for a pending patent application, while this is required in Europe from the third year onwards. Indian legislation requires maintenance fees to be paid on an annual basis, while it is required only in three stages in the US.

A simple solution

So, is there any way to simplify the process of cost estimation? The answer is ‘yes’ and this is where Quantify IP fits in. The company, founded in 1984, has been a pioneer in developing robust cost-estimation software for the intellectual property industry, and is now widely recognised as the industry leader.

Our flagship software solutions accurately estimate the costs for either a single patent family (Global IP Estimator) or an entire patent portfolio (Portfolio Estimator), based on data input by a user relating to one or more complete specifications. Our research team has studied legislation, costs, and timelines in more than 150 jurisdictions across the world and is constantly on the lookout for changes. Such changes are incorporated into our software in the form of frequent updates.

Further, we have obtained fee schedules from a worldwide network of IP law firms. The 75th percentile of the values found within the fee schedules supplied by at least five independent associates is used for most countries. The cost estimates also include any value added tax (where applicable).

An array of user-customisable features makes the Global IP Estimator straightforward and easy to use. These features include setting the receiving office, search authority, supplementary search authority, and examining authority for a Patent Cooperation Treaty application; estimating translation costs based on number of pages or words; defining associate charges; and excluding specific stages of the patenting process. In addition to patents, the software can also handle individual trademark, utility model and design families.

Portfolio Estimator

The Portfolio Estimator differs from the Global IP Estimator in that it can estimate costs for a portfolio of patent families that has a record in an internal docketing system. Our sophisticated algorithms facilitate importation of docketing data from almost any docketing system. Portfolio data can also be manually entered. The tool can be customised with user-defined groups. For example, a report could be summarised by business unit and then by technology within each business unit.

The Portfolio Estimator generates a wide variety of advanced reports. A “Detail Cost Analysis” report is vital in an exploration of cutting future costs. It provides a patent/country analysis which details future costs by year for each patent in each country for the next 20 years.

An “Expiring Patents” report lists the patent applications that will expire in the next five years, with the remaining maintenance costs.

Another example is the “Ungranted Aging Report”, which summarises and details the patent applications that are still pending, three years after the average time-taken-to-grant for each country (the value of three years is customisable). This report may help in identifying applications that can be abandoned either because there is a possibility that they may never be granted, or because the disclosed technology has become obsolete, thus contributing tremendously to cost savings.

In addition, the software has advanced capabilities; costs for future filing scenarios that do not have a record in a docketing system can also be generated. Within each filing scenario, frequency of filings can be set (for instance, one filing every two months for the next year).

More than 70% of the top 100 IP law firms in the US and dozens of Fortune 500 companies rely on our tools for estimating the future costs of client patent portfolios and in-house patent portfolios respectively, all with consistently positive feedback.

Anthony de Andrade is president and chief executive of Quantify IP, a company he founded in 1984. De Andrade has conducted extensive research on the development of customised software for the IP industry, and created one of the first IP accounting software and docketing software systems. He can be contacted at: adeandrade@quantifyip.com

This article was co-authored by Venkatesh Viswanath, who is an Indian patent agent. He is in charge of content generation at Quantify IP. He can be contacted at: vviswanath@quantifyip.com