What does "license a patent" ip brokerage firms mean and why is it done? IP: 194.187.249.2 Posted on June 30, 2022 at 07:44:01 AM by zavana
What does "license a patent" mean and why is it done?
Licensing of a patent simply means that the patent holder grants to some other person/other organization permission to produce, use, sell, etc. his/her patented invention. This happens in accordance with the agreed terms and conditions (for example, defining the amount and type of payment that the licensee must make to the licensor), for a specific purpose, in a certain territory and for an agreed period of time.
The patent owner can grant a license to a third party for many reasons. The patent owner may not have the necessary production capacity and therefore decides to allow others to produce and sell his/her patented invention in exchange for the payment of "royalties". Alternatively, the patent owner may have production facilities, but they may not be sufficient to meet market demand. In this case, he/she may be interested/interested in licensing the patent to another manufacturer in order to take advantage of another revenue stream. Another possible situation is that the patent owner wants to focus on one geographical market; therefore, the patent owner may prefer to grant a license to another person/other organization interested/interested in other geographical markets. The conclusion of a license agreement can help establish mutually beneficial business relationships.
Unlike the sale or transfer of a patent to another party, the licensor still has ownership rights to the patented invention. Replies: