UPC Opt Out: Portfolio Strategy – Patent

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We looked at the factors that can help you decide whether or not to deny an individual patent in our previous blog. However, there is also a broader issue of exit strategy in your EP portfolio.

There are basic three available strategies:

  1. Disable all your EP cases;

  2. Do NOT exclude EP cases; Where

  3. A hybrid approach, opting for selected cases.

A global strategy that is the same for every patent strategy will provide the opportunities and risks mentioned in our previous blog universally across your entire European portfolio. However, other considerations will also be relevant when reviewing portfolio-wide strategy, particularly if you plan to take a hybrid approach to your exits:

  • Stronger patents, such as those that have survived an EPO opposition, may present a lower risk of central revocation in the JUB than weaker patents. You can choose to refuse any patent that you consider more vulnerable to revocation in order to make this process more difficult for your competitors.
  • The technological fields of your patents are also relevant. Pharmaceutical and biotechnology patents are often more valuable and geographically more extensive than those in the fields of engineering or electronics and are therefore attacked more regularly. If your business operates in more than one technical area, you may choose to take a different approach to patents in different areas – for example, keeping your high-value medical patents out of the UPC by using opt-in options. -outs, while reducing costs and administrative burden by leaving your engineering patents behind.
  • UPC infringement actions will offer the best cost-benefit ratio if your EP patent is validated in many UPC countries. If you only validate in a small number of UPC states, the potential savings compared to a separate national application may be more limited compared to the risk of central revocation. You can choose to leave patents with a broader geographic scope in the UPC and exclude others with a narrower scope.
  • How many patents do you have? If you’re a smaller company with fewer patents, each individual patent may be more valuable to you, so protecting them all via the opt-out might make sense. If you are a large company with hundreds or thousands of patents, the loss of a patent during a central revocation in the UPC may be less of a concern and the administrative burden of the opt-out will be very high.
  • Exclusions will be made public, so a hybrid strategy may inadvertently reveal or at least implicate sensitive business information. For example, if you remove only a small number of patents from a large portfolio, your competitors may infer that these are your most valuable patents or the ones you consider weaker. On the other hand, if you adopt an overall strategy of removing (or not) all patents from your portfolio, your competitors can glean much less information.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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