Myopia is generally what happens when unprecedented opportunities are placed before them. Those in the know generally do better than those in the worry. Consider Cetus, a startup biotech with a focus on a liver drug. The FDA delayed the approval of the drug, and a major funding crisis ensued. Chiron offered to take over the liabilities contingent on the sale of two patents (# 4,683,202 and # 4,683,195) to a third party, Roche Molecule for $300M (in 1993). This sale was stalled because DuPont challenged the validity of the patents, based on the formal claims written by the inventor (not a patent attorney), Kary Mullis. In the end, the soap opera turned out well for the investors with weak constitutions. For $300M, they sold the two patents to Roche, turned the company over to Chiron, and walked away. Kary Mullis won the Nobel prize for his invention embedded in these two patents, known as polymerase chain reaction (PCR) which allows DNA to be cloned. Over 4000 patents in biotech cite these original two patents. In our estimation, $300M represents "pennies on the dollar" valuation of these patents. The shareholders got a payday, and left the game. Roche on the other hand is thriving based on its intangible assets. Let IPstreet.com assist you.

Patents have a maximum life of 20 years and, therefore, a 20-year potential monopoly. Patents that are just beginning their life and which have longer to run on the their potential monopoly position understandably will have more value. It is rare that a patent nearing the end of its term will cause a great threat to its competitors. It is almost certain that they will have devised technologies or products of their own by then that will not interfere with the patent owners monopoly position. In addition, one has to take into consideration the potential business life of a patent, i.e., the duration, which a patent is likely to be economically useful, if other subsequent patents are providing better alternatives to it.

In Nortel's recent bankrupcy, the liquidation of the IP assets led to a bidding war. Google offered $900M for the patents; Apple and Microsoft created an alliance (with RIM, Sony, EMC, Ericsson) to offer $4.5B for the same patents^. Certainly there was a great disparity in these bid prices. How can you objectively determine the value of a portfolio and patent duration. Let the tools at IPstreet.com help you.

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Joseph Schumpeter, known as the Prophet of Innovation, describes the importance of inventors in his Theory of Economic Development. Inventors are the "fiery-spirits" that disrupt the status quo with their vision of doing things 'better, faster, cheaper.' In the process, their inventions represent "the heroic intervention of individual men (or women) who appear as leaders toward new economic shores." We believe that intellectual assets, commonly taking the form of patented technology, are the least-understood and most-relevant resources to stimulate economic development through innovation. To make this happen, intellectual property (IP) needs to be more comprehensively understood so that better business decisions can be executed. This is why we are in business. An invention must have economic utility to benefit society. Some times, inventions are way before their time. However, most of the time, the business execution to commercialize the invention fails. In fact, those that conceptualize the invention rarely reap the rewards of the innovation's ultimate success.