IP Budgeting Challenges: Estimating and Analyzing IP Costs
IP Cost Management
April 22, 2024
With rising workloads and reduced budgets, IP professionals are constantly faced with the need to re-evaluate IP spending and reprioritize budgets. According to the Thomson Reuters Legal Department Operations Index 2023, 66% of legal professionals reported flat or decreasing budgets.
Companies are increasingly operating in multiple regions of the world, leading to an increase in global IP filings. Accurate IP cost estimates are more than ever a necessity to manage a growing IP portfolio effectively within budget. However, this is easier said than done. IP budgeting is a time-consuming and complex task.
The Complexity of Budgeting in Multiple Jurisdictions
One of the most demanding aspects of IP budgeting is the need to protect your IP assets across different jurisdictions, which requires skillful navigation through a labyrinth of national and regional legislation.
Every jurisdiction has a unique set of procedures from filing through grant and maintenance. In addition, the fees and rules for different jurisdictions are constantly updated, making it difficult to rely on past data. Further complexities arise when you need to choose a specific route for your international filing strategies among various options available, such as the Patent Cooperation Treaty (PCT), Paris Convention, Unified Patent Court (UPC), and European Patent (EP) validation.
Key considerations for IP budgeting
An intellectual property budget is like a complex jigsaw puzzle; fitting the pieces together can be a challenge even for the most experienced professionals. There are four main considerations: official fees, attorney charges, translation costs, and in-house fees. These, in turn, are spread across the different stages of the intellectual property lifecycle: filing, examination, prosecution, grant, and annuities.
Official Fee Variables Across Jurisdictions
The official fees for patents depend on a myriad of variables, such as the number of pages, the number of claims, and the number of priorities claimed. For biotech inventions, you also need to account for the number of pages of sequence listings. The mode of filing, such as electronic or paper filing, the type of applicant, the selected International Searching Authority, and the International Preliminary Examining Authority under the PCT also impact the official fees.
For example, the Japan Patent Office charges a basic fee of around $15.5 US dollars for rewriting data into electronic format and an additional fee of around $5 US dollars per sheet. The State Intellectual Property Office of China, the Indian Patent Office, and the European Patent Office charge fees for excess claims and excess pages (over 30 pages and 10 claims in both China and India and over 35 pages and 15 claims in Europe).
In addition, translating a patent application into languages such as Chinese, Japanese, Korean, or Russian accounts for a large portion of the total cost, approximately 65% to 80% (Data received from internal Anaqua analysis).
Predicting IP Budgets Using Spreadsheets Makes It Difficult to Control Your Budget
With so many variables, developing IP costs from a simple spreadsheet or estimating future budgets based on past data can be inaccurate and time-consuming. As a result, IP professionals regularly see a wide variance between the budgeted spend and the actual spend.
Relying on historical data to predict future IP cost estimates may not prove accurate, since there are regular updates in IP costs and rules across geographies. New routes and regional agreements make it even tougher to quickly perform a cost-benefit analysis between different global IP filing scenarios.
To accurately estimate your IP cost forecasts, you need automated tools with up-to-date costs and rules of different jurisdictions. The tool should generate cost estimate reports quickly and in a presentable format so you can easily make strategic IP decisions.
How Anaqua’s Global IP Estimator Can Help with Cost Estimates
Anaqua’s Global IP Estimator® collects IP cost data from a worldwide network of intellectual property law firms and official offices. For over 30 years, Global IP Estimator has helped IP professionals obtain accurate, up-to-date IP filing cost estimates for their patents or trademarks.
Global IP Estimator provides accurate and detailed cost and timeline estimates for the filing of a single IP asset. You can generate estimates for more than 150 countries by choosing your preferred filing route, such as PCT, UPC, or national application. The cost estimates provide a detailed and in-depth analysis as they are broken down by filing stage and cost category, such as official, translation, annuity, or in-house for each country.
Global IP Estimator is integrated with Anaqua’s automated IP docketing platform, PATTSY WAVE®, so you can generate filing cost estimates directly from any patent or trademark record. Simply enter the basic details of the filing application, select the desired countries and routes, and generate detailed cost estimate reports in formats that can be easily shared with clients and decision-makers.
"If you don’t have tools like the Global IP Estimator or PATTSY WAVE for annuities, then you’re stuck with going to foreign websites and looking up the costs for every single case. This process can be time consuming and brings with it a heightened risk of inaccuracy without software like Global IP Estimator."
Joshua Gibbs, National Intellectual Property Manager at DLA Piper
Simplify Your IP Budgeting Processes
Finding precision and accuracy in your IP budgeting can be a challenge for most IP teams. IP costs are constantly changing, and IP portfolio data can be spread across multiple systems or spreadsheets. When you need to be able to provide accurate IP cost estimates to finance and your business leaders, IP budgeting software can provide you with the accuracy you need to control costs and make portfolio decisions. Global IP Estimator simplifies the entire IP budgeting process and has helped corporations and law firms to get the planned budget within 1% of actual spend, making it the preferred solution for IP budgeting.
Interested to learn more?
Additional Reading:
- How Can IP Teams Simplify International Patent Filing?
- Achieve IP Operations Excellence and Cost Efficiency with PATTSY WAVE
- End-to-End IP Financial Management
- Five Minutes with Joshua Gibbs, DLA Piper
- Patent, Trademark, IP Portfolio Tools - Quantify IP
Sources: Thomson Reuters Legal Department Operations Index 2023 (p.4)
Further Reading
