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Yes, if you own a patent, you can sell the patent rights to someone else.
Selling a patent is one way to make money from your intellectual property. You can find out more about other ways you can make money from your patent here.
There are many reasons why the owner of a patent may choose to sell their patent.
One common reason is to provide a lump sum payment. This can free up money or capital for other projects or expenses. Thus, if money is needed quickly, selling your patent may be a preferred option compared to a more long-term financial arrangement, such as licensing.
Additionally, selling your patent can also reduce future costs for your business. This is because once a patent is sold, the patent owner no longer needs to pay any maintenance costs associated with the patent (e.g. annual renewal fees).
Another reason for selling a patent is that the owner may prefer to focus on research, and/or lack the resources to commercialise their patented invention. This is common for research institutions or start-up companies. In such cases, the sale of a patent can be used as a tool to establish connections and/or strengthen relationships with larger companies who have the resources needed to bring the invention to market.
Other reasons for selling a patent may include; as a tool for settling a conflict, including patents as part of the sale of a business, or if approached by an interested buyer.
As mentioned above, there are a number of reasons why the sale of a patent can be beneficial, however, before selling a patent, there are a few things the patent owner should consider.
Selling a patent may limit the amount of money you can make from your patent. As an alternative to sale, licensing may sometimes be a preferred option for a longer-term financial return, allowing the owner to retain patent rights whilst providing someone else with the right to use the patented invention for a royalty fee. Royalty fees can be enjoyed for the remaining lifetime of the patent and can amount to significant revenue overtime. Thus, any upfront payment for the sale of a patent should take into account potential royalties.
Furthermore, once a patent has been sold, the old owner will cease to have the right to use the patented invention (unless there is a contract that states otherwise). Therefore, the owner should be confident that the patent is not currently in use, or that there is no foreseeable use of the patent in the future. The owner should also consider that sale of the patent may result in the loss of control over the future use and development of the patented product or service.
First you will need to find a buyer for the patent. Potential buyers might be found in companies operating in the same industry as the patented product or service, or those looking to expand their product offerings with new technologies.
You will also need to assess the market value of your patent, taking into account the size of the market, the demand for the product or service, the remaining term of the patent, and the costs associated with manufacturing and marketing the product or service.
There are many online marketplaces for buying and selling patents. Patent brokers or agents may also be used for maximum financial return.
Once you have a buyer, you can then proceed with the sale, which involves negotiating the final price for the patent and any associated terms of the sale. Much like the sale of real estate, intellectual property rights like a patent must be assigned in writing and be signed by the assignor. Typically, a sale contract is drawn up to legally complete the sale transaction.
Once the patent has been sold, the buyer should then record the transfer at the relevant patent office.
Failure to record the transaction means the buyer cannot claim the full benefit of the patent, and in certain circumstances, may lose rights in the patent.
Selling and transferring patents is a complex legal process with many factors to consider. Before proceeding with any sale, you should speak to an expert to ensure the sale will deliver on your commercial aims. To find out more, please contact us to speak with one of our attorneys.