In-licensing and Out-licensing in Medtech and Biotech

In-licensing and Out-licensing in Medtech and Biotech
2018/02/02
Medtech and Biotech start-ups typically require continuous capital injections from investors to reach a product's launch, so it becomes crucial for these comnpanies to constantly minimize risk and optimize their IP-portfolios.

Due to high product development costs and potentially years of conducting clinical trials, the valuation of pre-market Medtech and Biotech start-ups are often based on the investors understanding of the risks and rewards of the IP owned by the companies. As research moves forward and development milestones are cleared, the risk is reduced and the valuation goes up. The reverse, on the other hand, does not have to be the case if the company has sucessfully developed the potential of its IP.

 

How to gain better valuations?

Medtech and Biotech start-ups typically require continuous capital injections from investors to reach a product's launch, so it becomes crucial for these companies to constantly minimize risk and optimize their IP-portfolios. Failing to do so may cause investors to abandon their investment, and finding new investors in this situation can be a tough job. In-licensing new IP that fits into the business model of the company could help secure better valuations. Even though this model has been slow to be adopted, most investors are today more likely to invest in companies that understand how to get the most value out of their own IP by viewing a holistic perspective and seizing the opportunities that lie in both in-licensing and out-licensing.

 

In-Licensing IP

In-licensing can be a short-cut to reaching an earlier return of investment or to achieve a highly increased valuation at the first public offering. This is not a situation that is as uncommon as one might think. Actually, Novartis has out-licensed IP to over a dozen biotech start-ups, for example. Furthermore, Pfizer's acquisition of Agouron, which owes its success to in-licensing of IP for the drug, Viracept, is still one of the largest transactions in the history of biotech.  Hence, all biotech start-ups should at least include a strategy for investigating the potential of i1n-licensing IP, not only from larger companies, but also patented reasearch from universities, hospitals and other research organizations.

If you wish to know more about what technologies are available, you can search the Licentix database using the advanced search funtionality. Licentix has more than 12,000 listings in the database that are based on granted or pending patents.

 

Monitor the market for IP

One of the methods to get better insight into what potentially important IP is available for your company, is to monitor the market for IP on a continuous basis. This can be done online by setting up search agents, searching on Google, or by having contact with different platforms containing knowledge categorized by industry. It's time consuming but very important work if you don’t want to miss out on any important IP you might be able to license or even buy.

Licentix also offers reports to survey the market for available IP related to Life-Science patents. Try out a sample of selected Life-Science opportunities or enter your own keywords to see a free sample report.

 

Out-licensing IP

Another way to increase the success of medtech and biotech start-ups is to outlicense parts of the IP to companies that can exploit the potential within other market segments. For pharmaceutical start-ups, there may be a drug that has the potential for curing more than one disease, but it would be too expensive for the start-up to conduct further clinical trials. And for a medtech company, it might be the use of certain equipment or diagnostic methods in veterinary or dairy segments. Mostly, the focus on a primary goal is necessary for the biotech start-ups to become successful, but it would be unreasonable not to exploit the full potential of the developed technologies by out-licensing.You can use Licentix to list your IP-offerings and describe each potential use separately.

You can start exploring how this works and search for potential buyers for free.

 

To further help in promoting the IP, Licentix has launched a proprietary service called DirectInvite that helps patent owners connect with potential buyers who would not otherwise see the technology offering. You can watch the video below to learn more about how DirectInvite works.

 

 

If you wish to use our services without registering online, we will send you an offline template. Simply fill out the fields as indicated and return it to our email address with the technology description attached.

Use the contact form here or contact us by phone: +45 70 5000 60 or by email: info(at)licentix.com