Therapeutic Patents: A Case Study
Measuring an innovation or an individual, group or company’s innovativeness has always been challenging. Although patents do not reflect completely innovations, because of its strong relation with R&D activities and its quantifiable data, patents has been often chosen as the measurement for R&D innovative activities.
Patents do not equal to innovations and not all patents have the same value. There are only a small number of patents that are highly valuable. Approximately 10% of the most valuable patents account for more than 80% of the value of all the German patents (Scherer & Harhoff, 2000). More than 60% of patents are neither used internally nor licensed out (Japan Patent Office). Firms often use patents not only for product development purposes but also as business tactics; for example, blocking other firms’ patents or to create barrier of entry. In some other cases, firms intentionally choose not to patent their inventions since that will require the disclosure of information, therefore, other means such as trade secret were used.
However, patents could still be evidences of innovations because they represent a large part of R&D effort by firms. R&D and patenting strongly affect one another where a company’s decision to patent an innovation could reflect that firm’s R&D effort (Arora, Ceccagnoli, & Cohen, 2008). Patents also …show more content…
Since “technological progress is cumulative so that inventors stand on the shoulders of others for further progress”, “a large number of forward citations mean that the patent serves as a giant shoulder for many other subsequent innovations” (Nagaoka, Motohashi, & Goto, 2010). Since inventor of subsequent innovations usually try to save the cost of R&D both in term of finance and effort in order to not reinvent the wheel, a high number of forward citations can represent that patent has wide applications and has high social value (Nagaoka, Motohashi, & Goto,
Patents do not equal to innovations and not all patents have the same value. There are only a small number of patents that are highly valuable. Approximately 10% of the most valuable patents account for more than 80% of the value of all the German patents (Scherer & Harhoff, 2000). More than 60% of patents are neither used internally nor licensed out (Japan Patent Office). Firms often use patents not only for product development purposes but also as business tactics; for example, blocking other firms’ patents or to create barrier of entry. In some other cases, firms intentionally choose not to patent their inventions since that will require the disclosure of information, therefore, other means such as trade secret were used.
However, patents could still be evidences of innovations because they represent a large part of R&D effort by firms. R&D and patenting strongly affect one another where a company’s decision to patent an innovation could reflect that firm’s R&D effort (Arora, Ceccagnoli, & Cohen, 2008). Patents also …show more content…
Since “technological progress is cumulative so that inventors stand on the shoulders of others for further progress”, “a large number of forward citations mean that the patent serves as a giant shoulder for many other subsequent innovations” (Nagaoka, Motohashi, & Goto, 2010). Since inventor of subsequent innovations usually try to save the cost of R&D both in term of finance and effort in order to not reinvent the wheel, a high number of forward citations can represent that patent has wide applications and has high social value (Nagaoka, Motohashi, & Goto,