For running a business an entrepreneur needs to develop a careful, well-thought strategic plan through a step wise approach. It not only helps their business operate successfully and achieve its goals but also makes it prepared for any prospective or possible adverse scenario. Different companies develop different strategies by analyzing themselves and the industry in which they operate. But when it comes to “IP strategy,” these strategies should be in parallel with the business strategy. A key strategy that can influence the most strategic considerations in a business is “exit strategy.” Now, it’s interesting to see that IP assets are critical for medical device companies for achieving desired outcomes from business exit, which clearly means that the exit strategy and IP strategy need to be in coordination. So, it won’t be wrong to suggest medical device startups to keep their IP protection goals aligned with their business goals to have a viable exit.
IP Strategy in Medical Device Realm
Any medical device startup involved in manufacturing or inventing medical devices based on innovative healthcare technology and aimed at improving the life and quality of patient care, needs to secure their appropriate IP rights. IP strategy plays an important role in helping such companies to conduct their research & development (R&D) in a way that they have freedom to operate while protecting their patents and investments made for R&D.
Each and every startup needs to know its exit strategy in the earliest stage of business to exploit the market during its overall business span, which in most of the cases could either be its potential acquisition by any larger corporation or to have a successful IPO. An exit strategy is essential to companies’ long-term goals and may involve anything from a selective managed process to budget expansion plans. Planning viable exit options with careful analysis and realistic assessments develops a sense of confidence among investors and creates more chances to attract future funding and acquisition interest.
How IP Strategy Is the Best Exit Strategy
The time a company comes into operations from being an idea, it needs to plan in advance its business exit strategy while protecting its IP rights. When planning an acquisition exit strategy, a startup needs to bring itself in an excellent position where it can outsmart its competitors by considering its IP as an asset.
"As strong would be the IP portfolio, more opportunities for startups to be noticed."
Big companies like Apple, Google, and Facebook always look for acquiring startups with great IP as part of their business expansion plans. Whenever they feel threat from promising startups, it’s their IP which helps them operate their business and attract potential suitors.
"The trend is clear, if a startup is generating significant profits through its IP, its potential competitor will most likely to buy it out."
According to a WIPO research, startups with promising patents lure more investors, generate more revenues, and have higher business value and different exit opportunities. And that’s why many big corporations strategically invest in the startups with leading IP to dominate the market through innovative technologies. As a result more exit opportunities emerge for startups.
So, in order to survive and thrive in the market, medical device startups must opt for having a broad portfolio of IP rights to protect their innovative medical device products or brands. A strong IP portfolio gives startups one of the best exit strategy options to get competitive advantage over their competitors, helps them plan filing of patent and trademark applications in advance to avoid major litigation costs, and provides them a way of making return on investments till their business is in operation.