IP In Start-Up Ecosystem

In this age of innovation and technology, Intellectual Property (IP) is an essential element for an organization to sustain and flourish over long periods of time. This is particularly applicable for organizations which rely heavily on R&D to develop technology based solutions for existing problems, and the biotech startup community is no different.

- Durgesh Mukharya

Gone are the days when exploitation of IP used to be limited to large organizations with deep pockets. Today, the technology driven economies have made IP integral and almost synonymous to ‘valuation’ of a start-up or MSME. Many acquisitions of start-ups in the recent past where the patented technology was at the core of the deal, have corroborated this philosophy.

As is often the case with start-ups, funding and sustainability become major hurdles that need to be timely overcome for them to stay alive in the game. The challenge is amplified multi-fold for a biotech start-up, where the lab-to-market incubation time is relatively long. This means that for the start-up to continue its quest for success, funding must keep coming in regularly, which in-turn means keeping the investors happy.

While the funding agencies in the recent times have widened their arms to the start-up community, the ROI expectations are also higher than ever before. Investors are on a constant look out for a sense of security to confirm that every dollar is well spent, and that the organization believes in its technology, is looking at safeguarding its interests and has the intent to be aggressive against competition emulating them. IP protection provides that comfort.

Though broadly IP encompasses trademarks, copyrights, industrial design rights, and trade secrets, patents form the most significant chunk for tech-driven industries. Simply put, patents provide an innovator a monopoly over a technological invention in a country, typically for 20 years, and act as exclusionary rights that prevent a third party from making, using, selling or importing the patented innovation in a geography. The idea is to incentivize innovation and advancement of technology by recognizing and rewarding those who innovate.