Is that patent worth buying?

Many of the failed business acquisitions recently have run aground because of issues related to poor due diligence of intellectual property–particularly patents.   David Wannetick commented yesterday on how patents create value on the Axial Markets blog.   He writes: “Savvy licensing professionals will conduct intensive due diligence to understand the dynamics of their potential licensing partners in order to seize the incremental advantages associated with deconstructing their business models.

A particular patent acquires value because of the:

• Ability to commercialize.
• Stature of the inventor.
• Value of depriving competitors of key technologies.
• Acquirer’s or Licensee’s portfolio concentration.
• Capital raising implications.
• Economic impact of licensing agreement.
• The profitability of the industry and the importance of acquiring such patents.

Wanetick is managing director at IncreMental Advantage, a strategic advisory firm.