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Written by: Demian Stauber

Published: 28 October 2020

Last Updated: 01 December 2020

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Typical IP-related Contracts

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First published 28 October 2020 by Demian Stauber - co-author(s): Maria Iskic

In this blog, we will shed light on a few standard contract types relevant for safeguarding your intellectual property.

Why care about contracts?

Intellectual property rights are property rights. This means, that someone is the owner of these rights. The owner has the right to determine who may use what is protected by his rights.

Typically, the original owner of intellectual property rights is the creator (note: this does not apply to trademarks), i.e. the individual who makes an invention (patent) or creates a work (copyright). However, as soon as several parties become involved in the creation of intellectual property, the legal reality concerning the rightful owner might often significantly deviate from the expectations of the parties.

For instance, if the original owner is an employee of a company, there are countries in which the rights created by the employee belong directly to his employer or in which the employee is at least required to transfer his rights to his employer if the employer wants to acquire these rights. If on the other hand, you engage a freelancer to create something, the intellectual property rights to that creation might stay with the freelancer, in spite of you having financed the creation.

Another example would be if we have several people from different organizations collaborate, such as in research or development. These joint collaborators may become joint-owners of the new creations. In these circumstances, it should be contractually agreed which party has which rights in the jointly created intellectual property, or you might end up not being able to commercially use your intellectual property without the other person’s consent.

However, these situations can be contractually anticipated and regulated. Intellectual property rights may be transferred from one owner to another owner. This may happen by way of a full transfer of all rights (like a sale, a so called “assignment”,) or by granting someone else certain use rights (like a lease, a so called “license”). The use rights may be customized in particular with regards to the scope, the time or territory.

Finally, contracts may be important to preserve your intellectual property rights in the first place, because patents and design rights may be “forfeited” if you disclose your invention or design to a third party without appropriate confidentiality clauses in place.

Employment Agreement / Freelancer Agreements

As explained above, it is important that intellectual property rights developed by your employees belong to the employer. Therefore, it is advisable to include a standard IP-clause in your employment agreements. If you have employees domiciled abroad, local laws need to be taken into consideration. Further, in certain settings, in particular if some of your employees are still partly employed with Universities, this topic needs to be addressed very carefully.

If you use consultants or other personnel not employed by your company, it is crucial to include in the consulting, freelancer or other agreement rules to ensure that you own the intellectual property rights created by these agents, as if they were employees. Absent such clauses, there is a significant risk that you do not own (all) the intellectual property rights created by these parties despite having funded the respective creation.

Confidentiality Agreement (NDA)

The confidentiality agreement or non-disclosure agreement (NDA) is an agreement that permits the parties to share certain confidential information before entering into any specific contract. Often, NDAs are used to evaluate a possible cooperation, which requires that certain business or technical secrets and know-how are exchanged.

It is crucial to define the scope of the confidential information clearly (for instance: is all information disclosed confidential, or does it need to be marked in a certain way). Further, it is important to keep track of the duration of the agreement and potential “survival” of certain obligations.

Be aware that the typical confidentiality agreement is not an appropriate substitute for the collaboration agreement between the parties. In practice, we often come across relationships of parties for which only an NDA exists. Most NDAs, however, lack provisions on jointly developed intellectual property etc.

Research and Development Agreements

Research and development agreements are the right instrument if you provide or source research services or product/software development. They are not suitable to be used for the manufacturing, sale or supply of the product, which may follow upon the development. However, it may be advisable to already fix some key aspects of a potential supply agreement.

R&D agreements need careful drafting, not only for addressing intellectual property rights but also for various other reasons (such as “do you owe a result or just careful work”, default, warranties, liability, etc. ). From an intellectual property perspective, there need to be rules about existing technology (often referred to as “background”) and access to it as well as clauses on newly developed intellectual property (often referred to as “foreground”). On the foreground, topics such as ownerships, use rights, obligation to prosecute and maintenance of patents, cost etc. need to be addressed.

License Agreements

License agreements are concluded to grant use rights on intellectual property rights that you own. It is key to determine the scope of the license, for instance whether you grant a license to the patent or only for certain products, the geographical scope, whether sublicensing should be allowed, for how long the license lasts, etc.

In return, the remuneration (license fee, royalty) must be clearly defined and understood by both parties. Many disputes arise from unclear provisions pertaining to royalties.

Assignment Agreements

Intellectual property rights can not only be licensed but also transferred to another party. Through an assignment agreement the owner of e.g. a patent transfers all of its rights related to such patent to the assignee which subsequently is the new owner of the right.

It is important to note that the transfer of IP rights requires the compliance with various formalities. Ultimately, the assignment will normally have to be registered with the relevant national authorities. These national authorities may have different requirements to a transfer of rights and often request various documents to ensure the validity of the assignment.

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Written by: Jan Kleffmann

Published: 26 August 2020

Last Updated: 30 August 2020

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Cost of Patent Protection – What has to be expected?

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First published 26 August 2020 by Jan Kleffmann - co-author(s): Louis Lagler

Introduction

While patents can provide powerful protection for an invention, the costs involved with obtaining patent protection can be substantial and should therefore not be neglected. In this blog post the expenses which typically have to be expected are summarized on a high level to offer a realistic overview over the lifetime of a patent. It has to be kept in mind, that the provided information is based on our expertise and experience and may therefore be subject to significant variations, depending on the chosen strategy.

What is Patent Protection?

A patent is an Intellectual Property (IP) right granted for an invention. “Invention” in this context relates to a product, a process or an improvement thereof that provides a new way of doing something, or offers a new solution to a technical problem. A patent allows the owner to prevent others from using the protected invention for commercial purposes and to decide who is allowed to produce, sell or import the protected invention in those countries in which a patent is in force. In order to get patent protection, technical information about the invention must be disclosed to the public in a patent application. The protection provided by a patent usually lasts up to 20 years from the filing date of the patent application. After lapse of the patent, the invention becomes public domain and can be used by everyone.

Reasons to apply for a patent…

There are various reasons why you may consider to apply for a patent. Samples thereof are:

• Protection of an idea/technology solving a technical problem, e.g. in form of an improvement which will be implemented in a product.
• Avoidance of conflicts with competitors by claiming protection for the idea/technology.
• Creating assets in form of intellectual property (IP): When selling a company, the intellectual property owned by a company is often one of the most important assets.
• Tax advantages are possible on income generated from IP rights by utilizing the Swiss patent box.
• Marketing for customers and potentially investors alike.

While planning an IP strategy the business impact as well as the costs should be well considered in the budget as patents are usually too expensive when there is no equivalent business. In view of business decisions, this blog post aims to provide a brief overview of the typical costs involved with patenting an invention.

What will not be addressed in this blog post - but is at least equally important and should therefore be considered in each IP strategy - is the aspect of Freedom To Operate (FTO): Independent of filing patent applications to protect an invention, it is necessary to avoid collision between the products/processes brought to the marked and existing IP rights of others.

How much does a patent family cost?

As with most questions, there is no definitive black-or-white answer but the truth resides in various shades of grey. There are various factors determining the cost of a patent, as outlined below.

Generally speaking, the costs involved with obtaining and maintaining a patent can be placed into three stages:

• Stage 1: The costs associated with preparing and filing a patent application.
• Stage 2: The procedure up to grant.
• Stage 3: Annual fees for maintaining patent protection.

Realistic examples for the costs of stages 1 and 2, as well as stage 3 are given at the end of this blog.

Stage 1: Laying the basis for the future - Preparing the patent application

It has to be emphasized that the first application lays the foundation for all subsequent proceedings and ultimately the protection. It should therefore be prepared as thoroughly and complete as possible, keeping in mind that, once the first application has been filed, no alterations (additions or deletions) can be made which affect the content of the application and one is limited to what was originally filed. The reason being, that changes made to the application after it is filed, which affect the original disclosure of the application, usually have an impact on the validity or the application date of the underlying patent application.

The expenses for the initial stage (first year):

Attorney’s Efforts and Official Fees – Total approx. costs 5k-15k CHF which include:

• Discussion of the invention, patent strategy
• Professional Preparation of Application (Claims, Figures, Description) based on information provided by inventor/applicant
• Optional: Prior art search re. patentability of invention (plus 1k-3k CHF)

Comment: A patent application for a mechanical invention usually requires less effort to prepare than, for example, an invention in the fields of biology or chemistry. Additionally, within the respective areas, some inventions are more complex and more comprehensive than others, which typically translates into increased attorney fees as more time is require for different stages of patent prosecution, including drafting of the application. It also matters whether the aim of the application is to lay the base for a whole product family or if only a small improvement shall be protected. Efforts for protecting a new technology are usually significantly higher compared to those which occur when an improvement shall be protected.

Stage 2: Procedure up to grant – Shaping the claims…

The scope of protection is defined by the claims which are the most important part of a patent. Whether a patent with strong and therefore valuable patent claims is obtain or not depends on the results of the examination procedure. Depending on the strategy, the examination procedure typically lasts 3-5 years (it may be accelerated if necessary) and is based on and limited to what was originally filed (see stage 1 above).

During the prosecution of the patent application(s) costs mainly incur from one or several office actions which are dispatched by the patent examiner of the respective patent offices on a national/regional level. In order to achieve the best outcome in view of a strong patent it is necessary to:

• Analyze documents of prior art cited and the arguments brought forward by the examiner in the office action
• Discuss options and define the strategy with the applicant
• Prepare and file a reply to the office action
• If necessary, conduct a telephone interview with the patent examiner(s)

The costs are greatly influenced by the following two factors:

Number of Office Actions/Timing: Usually 1-4 office actions are necessary until the patent application is granted or rejected. More difficult examination procedures require more office actions which lead to greater overall costs. Interesting information regarding the grant rate of a specific US-examiner can be retrieved here. After a reply to an office action has been filed it usually takes several months to more than a year until the next office action is received.

To be on the safe side, an average amount of 1k-3k CHF per office action should be taken into account.

Geographic Scope: The more jurisdictions are selected to seek patent protection in, (i.e. how many countries) the more costs will incur, as the official fees, as well as costs for local representatives and translations etc. must be taken into account.

After grant: It is still possible that after grant additional expenses occur, e.g. in the case that some files an opposition against grant of the patent.

Stage 3: Maintenance - Keeping the patent application / patent alive

After the grant of a patent the protection lasts up to 20 years from the application date of the original patent application. Provisional protection exists from the application date although the patent can be actively enforced only after grant of the respective patent.

In order to keep a patent alive in a country, annually occurring renewal fees have to be paid usually form the third and each subsequent year. These expenses vary depending on country and typically the fees increase during the lifetime of a patent. The total for renewals therefore strongly depends on the geographic scope in which patent protection is to be maintained. If the renewal fees are not timely paid for a specific state, the respective patent right lapses.

The following chart provides an overview of the official fees for five exemplary countries, as well as an estimation of the running total costs for the maintenance of the patents in those five countries (all amounts in kCHF) for the years 3 to 20:

Not covered by this blog are the costs for legal disputes. A patent claiming protection for a technology in a field of active competition can become subject of opposition proceedings after grant of the patent, wherein in most jurisdictions each party covers their attorney fees. Enforcing a patent in order to prevent a competitor from using or selling the protected invention may involve substantial costs as well.

Overview costs for an int. patent application and subsequent national patent applications (rounded figures)

• Up to filing of a priority founding first application: CHF 5-15k CHF for professional preparation and filing fees.
• Before 12 months after filing of a priority founding patent application: Filing of international patent application 5k CHF (assuming no changes are necessary on the priority founding patent application and the content of the priority founding application can be reused for the international application).
• Until 18 months after filing commenting search report / forwarding publication of application: appr. 2k CHF
• 30 months after filing of international application: entry into national phases (for 20 countries appr. 30-50k CHF
• After grant of the patent(s) annual fees need to be paid continuously in order to maintain the patent (see stage 3 above).

Filing an international patent application according to the PCT and then entering into the national phase thereupon delays the decision in which countries to seek patent protection and the related costs by about 1.5 years compared to a direct filing in the desired jurisdictions. This time is often valuable in bringing a product to market and getting customers feedback in order to make a more informed decision about the desired geographic scope of protection.

The figure below shows a typical timeline, the main steps in the process of getting a patent and the costs involved by example of a Swiss startup protecting a medical device for consumers. The costs arise from attorney fees (solid bars) and third party fees like official fees, local representatives etc. (striped areas).

In the example above the cost of preparing and filing the priority founding application in Switzerland (CH, blue) in 2015 are shown. In 2016 the international application (PC, red) was filed 12 months after the Swiss priority application. After 30 months in 2017 the national phases were initiated in China (CN, green), the US (light blue) and in Europe (EP, violet) causing costs in filing fees in each respective country. Afterwards costs occur for handling of the office actions in process up to the grant of the patents.

In case of any question, please feel free to contact the authors of this blog post or any other patent attorney from our firm via our contact form or at This email address is being protected from spambots. You need JavaScript enabled to view it..

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Written by: Louis Lagler

Published: 22 July 2020

Last Updated: 27 July 2020

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WIPO - Patent Cooperation Treaty (PCT) Yearly Review – 2020

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First published 22 July 2020 by Louis Lagler

The international patent system administered by WIPO is a very beneficial way for those who seek patent protection in multiple countries. By filing an international patent application (PCT-application) the applicant can benefit from the several advantages, e.g.: (a) postpones major costs associated with international patent protection by 18 month; (b) the results from the search and preliminary opinion received during the international stage provides a strong basis for patenting decisions; (c) the PCT-system provides a harmonized base for entry of the national/regional phase after 30 month counted from the earliest priority date.

WIPO was established in 1967. It has its headquarters in Geneva, Switzerland, and is the global forum for intellectual property (IP) services, policy, information and cooperation. WIPO is a self-funding agency of the United Nations, with 193 member states. WIPO’s mission is to lead the development of a balanced and effective international IP system that enables innovation and creativity for the benefit of all. Among others, WIPO administers 26 treaties including the WIPO Convention.

Latest numbers on the International Patent System (PCT-System)

WIPO published on 2020-07-14 the annual PCT-Statics 2020 which reveals interesting information on the PCT-System and the global development in the field of patents for 2019. The report can be downloaded here. It analyses the data which was collected from various IP-Offices around the world.

Key numbers

The key numbers for 2019 are:

This year's report provides a descriptive analysis of PCT filing activity at a subnational level, based on the location of inventors named in published PCT applications - so called clusters of innovative activity. According to the report, identifying and analyzing clusters of PCT filings allows for a more detailed overview of where the innovations described in PCT applications took place.

The top 50 clusters of innovation

The top 50 clusters can be summarized as follows:

• Six of the eight largest PCT clusters were in East Asia
• The top 50 PCT clusters account for almost 58% of all PCT filings
• Universities are the top applicant for six clusters
• Almost a third of filings from Shenzhen-Hong Kong-Guangzhou are in digital communication
• U.S. applicants filed over 10% of applications in one half of all clusters

Top Business Applicants

The report comprises a comprehensive list of applicants. The top 10 Business Applicants are:

Some selected statistics

PCT national phase entries for the top 20 origins, 2018:

Trends in PCT national phase entries for the top five origins, 2004–2018

Share of PCT national phase entries in total filings abroad for the top 20 origins, 2018

Top 20 applicants in foreign-oriented patent families using the PCT System, 2014–2016

(All four images were created by WIPO and are licensed under Creative Commons CC BY 3.0 IGO.)

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Written by: Christian Ebner

Published: 15 July 2020

Last Updated: 15 July 2020

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The Success Story of a Life Science Startup

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First published 15 July 2020 by Christian Ebner - co-author(s): Andrea Carreira

Swiss startup Inflammex AG developed specific compounds for treating inflammatory diseases. Last year, Inflammex AG was successfully sold in a multi-billion-dollar deal to a globally operating pharmaceutical company.

From a Serendipitous Finding to Starting a Company

The journey of Inflammex started at a local Swiss university, when two PhD students discovered that an accidentally synthesized side product showed a remarkable decrease in secretion of pro-inflammatory cytokines in initial biological studies.

Encouraged by these first results, further studies were directed towards the optimization of the anti-inflammatory behavior of their initial lead compound. After a first library of compounds has been synthesized, tested and confirmed the initially obtained biological profile, the entrepreneurial spirit of the young PhD students was awakened and they decided to found a new business Inflammex to pursue their vision of providing a novel treatment of inflammatory diseases.

Who owns the intellectual property?

From introductory courses in intellectual property, taken by one of the young founders during grad school, it was immediately clear that a patent application must be filed as soon as possible to protect their invention. First however, the question of ownership of the newly developed compounds arose because the promising results as well as the compounds per se have been produced and developed during their PhD studies. As both students were at that time employed by their university, the invention in fact belonged to the university.

Upon contacting the university’s technology transfer, the university assured them that it would assist in filing a patent application and also bear the costs for the first filing. According to the university’s internal policy, ownership would however remain with the university. Nevertheless, Inflammex would be awarded an exclusive license. Inflammex consulted a patent attorney to assist them in closing a license agreement that is fair to both Inflammex and the university. In particular, Inflammex would be in the lead in prosecuting the IP rights, in particular with respect to geographical protection and would have the option to award sublicenses.

Filing of the Patent

At first, Inflammex filed a Swiss priority founding application, which secured the priority date, i.e. the effective date that is relevant for any prior art for the corresponding patent application. A first filing in Switzerland has the advantage that the official filling fee is relatively low (CHF 200) and furthermore, upon request, a highly professional patentability search can be conducted by the experts at the Swiss Institute of Intellectual Property (IPI), which is even subsidized by the state of Switzerland.

This search revealed relevant prior art documents, which served as a basis for specifically amending the subsequent international application that was filed within 12 months of the day of filing the Swiss application. Thus, Inflammex knew already at a relatively early stage and before investing significant amounts of their funding if they had chances of obtaining a valid patent after a substantive examination.

In addition, in order to minimize the risk of running into problems with existing patents by any competitors, Inflammex further instructed their patent attorneys to perform a Freedom-to-Operate (FTO) search. Therein, the patent attorneys screened the prior art for any patents and patent applications that may potentially be infringed by the developed target compounds. Importantly, as patents generally expire 20 years after their filing date, the FTO searched was limited to the last 20-25 years, while the prior art search performed by the IPI considered all prior art documents. At first, the two founders were shocked, because the FTO search indeed revealed a patent with a claim scope that would potentially be infringed by some of their lead compounds. Gratifyingly however, patent protection only existed in Japan and the patent would expire within the next year, i.e. long before any clinical studies would commence and long before any market entry.

After one year an international application was filed based on the Swiss priority application, which provided Inflammex with a patent application that can be pursued in over 150 countries. Moreover, with the international application in hand, Inflammex could take part in startup competitions which did not only raise additional funds, but also brought them respect and reputation in the community. The international application was further important for securing more funding from new investors, which enabled Inflammex to set up novel facilities on its own, to continue its research and enter into collaborations with larger pharmaceutical companies. Ultimately, after 30 months from the first filling in Switzerland, it was decided to pursue patent protection in Europe, the US and China.

Patents as Leverage for Sale Negotiations

At that point in their career the founders knew they would have to decide whether to continue with their company and try to grow and become a bigger player in the pharmaceutical area or whether they would sell their company and return to their primary interest of searching for new treatment possibilities. The significant financial support required for conducting clinical trials, among other factors, ultimately led them to sell Inflammex together with its intellectual property on the developed anti-inflammatory lead compounds. The broad geographic coverage of their intellectual property portfolio covering the major important markets turned out as a major selling point in the sale negotiations with potential buyers.

While one of Inflammex’ founders stayed with the project within the new owner, the other was intrigued by the possibility to enter a different responsibility as a CSO in a newly founded life science startup.

Take Home Message

Founding a startup company requires a lot of courage, dedication and time investment. Especially within small teams, all members are absorbed by various different tasks and projects. However, securing the intellectual property of your startup is crucial not only for preventing your competitors from exploiting your idea, but also for securing funding. Investors want to secure their revenue, which in most cases is only possible if market exclusivity can be guaranteed.

Consulting a patent attorney already at a very early stage of the entrepreneurial journey is strongly advisable. Our startup team at Rentsch Partner AG offers free initial consultation sessions and specific consulting modules tailored to the needs of a young emerging tech startup.

Please feel free to contact us at any time via our contact form or via This email address is being protected from spambots. You need JavaScript enabled to view it.

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Written by: Philip Kerpen

Published: 20 February 2020

Last Updated: 16 June 2022

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Patenting Tips for Swiss Startups

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First published 20 February 2020 by Philip Kerpen - co-author(s): Matthias Städeli

In this blog, we answer some common questions and share some tips to get your patent strategy off the ground and help your startup take flight.

Can I get a Patent for my Invention?

Patents are granted for new, non-obvious and useful inventions. Generally speaking, an invention is a technical solution to a technical problem. Business ideas or other abstract ideas, on the other hand, are not regarded as patentable. However, the word invention must be understood broadly - not just inventions as revolutionary as the light-bulb and the transistor are patentable. Small advances to existing technologies form the bulk of granted patents, and every day, thousands of such patents are granted world-wide.

Tip: Think about the technical problem your invention solves and the difficulties you encountered while developing it – this can give you vital clues as to which parts could be patentable and worth protecting.

Tip: Software is also open to patent protection. As software plays an increasing role in many products and services, many companies are making use of the patent system to protect their software innovations. In particular, artificial intelligence has proven to be a technology with many applications. See our blog post for more details: How to Protect your AI Innovations with a Patent: Updated EPO Guidelines

What does a Patent give the Holder?

A patent grants the holder the right to stop others from exercising the patented invention. Though some international harmony exists in how patents are examined and enforced, patents remain national rights and therefore you will need a patent in those jurisdictions in which you wish to protect your invention.

Tip: You don't necessarily need patents in all jurisdictions – often having patents in a few jurisdictions relating to your key markets is enough to secure your invention.

How to Search for Existing Patents

A patent search is best performed before developing or launching a new product and can also be useful for market research. There are several powerful and free search engines available: we recommend Espacenet from the European Patent Office (EPO). Enter your search terms and scan the abstracts and figures to quickly get an idea if the result could be of relevance for your product.

Tip: Be sure to check the applicable jurisdiction of each document, as denoted by the first two letters of the publication, as well as the applicant.

Tip: There can be major differences between what is applied for and what is eventually granted, so remember to check the last two symbols of the publication number. For example, the 'A' publication EP2616147A1 refers to a European patent application published 24 July 2013 relating to an airbag rescue system, while the 'B' publication EP2616147B1 refers to the European patent as granted on 1 January 2019. The greatest differences are usually found in the Claims, which define the scope of protection and are often narrowed during grant proceedings.

The Swiss Patent Office (IGE) also offers an Assisted Patent Search, which is available to innovative SMEs, startups, individual inventors, and public research institutes. For CHF 300 (current fee) you can sit together with a professional from the IGE performs and conduct an initial basic search on your invention to get an impression of the state of the art. It takes half a day and at the end you will have a list of results and a basis for next steps.

Tip: For a more comprehensive patent search or to discuss and evaluate the results of your search, we recommend contacting a patent lawyer with expertise in your field of technology.

What to Disclose When

The patentability of your invention has to do with whether it is new, non-obvious and useful. The requirement of novelty is paramount, and the prior art search will give you an idea of whether your invention has already been publicly disclosed.

It is vital to remember that public disclosure also relates to what you yourself tell others about your invention, for example what you tell potential investors or customers, what you present at conferences or conventions, and what you publish on the internet.

Tip: Keep as much of your invention to yourself as possible until you have filed your first application. If you must talk about your invention, we suggest talking about it only in general terms and/or having NDAs signed by all participants.

Freedom to Operate

Whether your invention may infringe patents of third parties is also worth clarifying before you launch your product and is best done by a patent lawyer. A comprehensive freedom-to-operate search and opinion can be very time-consuming and costly to perform, however, given the large number of granted patents in existence, so a compromise may have to be made.

Tip: For startups a cost-effective and pragmatic approach can be best: focus on the granted patents your competitors hold and keep an eye on their pending patent applications.

Where should I File first?

Filing a first application for your invention at the Swiss Patent Office is a good idea, regardless of where you will eventually want to seek patent protection. The official fees are low and if you choose to have a search performed you will receive a good quality search report often within months of filing, depending on the type of search you choose.

This first application is a so-called priority founding application and within twelve months of the filing date you can file subsequent applications for the same invention in other countries. Making use of the international Patent Cooperation Treaty (PCT) or filing a European patent application with the EPO is recommended to streamline your subsequent applications. The twelve months also gives you breathing room so you can take into account tweaks to your invention and also strategically file subsequent patent applications.

Tip: To save costs with a subsequent European patent application, make sure to apply for an International-Type search with your first Swiss application. This is carried out by the EPO on behalf of the Swiss Patent Office, and when you file your subsequent European patent application, the search report will be recognized and the search fee can be partially refunded.