A recent report by the European Patent Office reveals that while overall patent filings decreased slightly in 2020 (-0.7%) compared to 2019, filings in healthcare significantly increased. The biggest sector in terms of European patent applications in 2020 was medical technology, accounting for 7.9% of filings, 2.6% up on the previous year. The largest gains were in the biotechnology and pharmaceutical sectors, which increased their patent filings by 6.3% and 10.2% respectively. In the UK, 2020 filings in the biotechnology field rose by 19.4% from the previous year, in sharp contrast with other sectors such as transport (-27.7%) and consumer goods (-33.3%).

These figures demonstrate the resilience of the healthcare sector in the face of crisis. They also show that successful companies recognise the importance of continuing to invest in innovation, and protecting those innovations with registered IP, even during uncertain times. While it might be expected that a pandemic would present opportunities to companies producing vaccines and therapeutics, the IP gains seen in the biotechnology and medical technology sectors indicate that related industries, such as diagnostics and medical devices, are also key growth areas.

One biotech company whose growth has been boosted by the pandemic is Oxford Nanopore Technologies. A spin out from the University of Oxford, the company developed a novel process of sequencing genetic material by passing DNA or RNA strands through a nanosized pore. This technology has been used to characterise coronavirus strains, and in August 2020 the company announced an agreement with the UK government to supply its LamPORE test for the diagnosis of SARS-CoV-2.

Oxford Nanopore recently announced its plans to list on the London Stock Exchange, with some valuing the company at over £4 billion. So where does the actual value of the company lie? Partly in its know-how, but substantially in the IP which protects the underlying technology. The company has a broad portfolio of over 200 patent families, some owned by the company itself, and some which are licenced-in. This portfolio, which covers different aspects of the sequencing platform technology, is critical to the company's ability to secure deals and attract investment.

However, this is not to say that biotech or medtech companies need hundreds of patent filings to succeed. Those looking to protect their innovations, secure investment and inoculate their company against future crises can focus on a few key points which have underpinned Oxford Nanopore's success:

  • Protect key technology. It is better to have a few robust patent applications which provide broad protection for key technology than a large suite of patents protecting peripheral innovations. Focusing resources on platform technology can also help to control costs.
  • Align Business and IP strategies. Aligning R&D resource and IP budgets with the direction of travel of the business ensures that optimum return-on-investment can be secured. Understanding relevant geographical opportunities and how to monetise R&D efforts (patent box; R&D Tax credits) can help to deliver ROI.
  • Place IP in the company's name. Particularly at an early-stage, much of a biotech or medtech company's value will reside in its IP. It is therefore important that patents and trademarks are registered in the name of the company itself. Investors may need reassurance that a proper chain of entitlement to the rights in the technology exists from inventors to the company, so ensure that suitable assignment documents are in place.
  • Safeguard future innovations. As a company grows, it is likely to work with collaborators or consultants to develop the technology. Before discussing a project with anyone outside of the company, an NDA should be in place to prevent disclosure that could undermine patent protection. Contracts must also include suitable IP clauses to determine who owns any new IP that is generated during the project.
  • Seek advice early. Regular communication with an IP advisor can help to identify potentially patentable inventions, and determine whether updates to existing applications are required, for example ahead of a clinical trial or press release, to ensure that the IP is in the strongest position possible.

The human and commercial effects of the current pandemic have been vast but medtech and biotech businesses have seized the opportunity to innovate further and faster than other sectors. As we slowly emerge into the 'new normal' post-pandemic world we expect to see further developments in these spaces.

Originally Published by Birmingham Business at page 41.

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