European patents help SMEs commercialise high-potential inventions, new study shows

A new study published today by the European Patent Office (EPO) finds that small and medium enterprises (SMEs) rely on European patents to protect their high-potential inventions and that two thirds of these inventions are commercially exploited.

The study, entitled “Market success for inventions – Patent commercialisation scoreboard: European SMEs”, finds that SMEs depend heavily on partnerships with domestic or foreign partners. The report shows that half of all commercialised inventions protected either by a European patent application or a granted European patent are exploited in collaboration with an external partner via a licencing agreement (62% of the respondents), co-operation (49%) or spin-off (32%). Moreover, the partner is usually from another European country. This reveals how resource-constrained SMEs use partnerships as a way of entering new markets or sharing the financial burden of innovation.

Furthermore, jointly exploiting inventions with external partners enables SMEs to leverage their partners' resources too. SMEs involved in partnerships identify "increasing revenue" (85%) and "market access" (73%) as the main motives for collaborative exploitation. Over half (56%) of them also cite "joint innovation" as a motive, followed by "outsourcing manufacturing" (42%) and "settling infringements" (32%).

However, the report notes that SMEs seeking international partners face serious challenges such as limited availability of IP expertise, resources, and business contacts to support their commercialisation efforts across Europe.

“SMEs are a key user group in the European IP system, creating new technologies, jobs and growth. And patents help them to protect their inventions,” says EPO President António Campinos. “Crucially, this new study demonstrates that SMEs are also using patents to commercialise their inventions, they are increasingly innovative with their IP strategies, and that there is tremendous untapped potential. Given the role that patents play in supporting our economy and bringing forward new technologies, efforts have to continue in finding ways to tackle successfully the challenges revealed in this study.”

The study explores how SMEs commercialise their European patents in practice. It is based on a large sample of European patent applications coming from 1140 European SMEs interviewed in the first half of 2019. All related applications were made between 2008 and 2018. The European patents themselves are either still being examined at the EPO or have already been granted. The study documents whether and how the inventions covered are commercially exploited, with a focus on collaborative forms of exploitation like licensing or co-operation. By analysing the patent commercialisation practices of European SMEs, the study offers policymakers valuable insights into the challenges facing these key players in European innovation ecosystems.

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