How to evaluate an early-stage invention
The evaluation of a new invention is a very difficult task, because sometimes you do not have all the information you need to do that.
Having a complete description of an invention is a good starting point but sometimes it is not enough.
It is of paramount importance to understand the technical problem solved by the invention, to know if and how someone else has already solved the same technical problem and the closest prior art.
Furthermore, it is useful to pinpoint the essential technical features of an invention: this is a good starting point to carry out a comprehensive state-of-the-art search in patent databases.
After having identified the closest prior art (one or two documents), the next step is the evaluation of patentability requirements (novelty, inventive step and industrial application).
The novelty requirement is simple to explain and to evaluate: an invention is new when it differs from the prior art. Not much difference is requested; a simple difference is sufficient.
The inventive step is more subjective but the Problem and Solution Approach (PSA), planned by the European Patent Office (EPO), can help to solve this task.
The first step is to establish the differences between the invention and the prior art. Then, given those differences, one should ask: would an ordinary skilled technician have been motivated to modify or combine teachings of the prior art in a manner that would arrive at the claimed invention? If the answer is yes, the invention is obvious.
Other factors than the patentability requirements that must be taken into consideration are:
- the size and the growth of the market
- the development stage of the invention (It is a parameter that indicates the actual gap to the effective commercial exploitation of the product)
- the time to market (It is the time required, starting from the actual development stage of the invention to the launch of the product on the market)
- the product lifecycle (It is the lifetime of the product on the market or, in other words, the time in which it remains competitive and not replaced by a new product.)
- the technological risk (Some inventions are based on a well-established technology, that makes the products well accepted by the market. The risk of failure is very low. Conversely, a good idea at a conceptual or an early experimental stage, can be very risky if it requires an expensive technology and therefore it may be not consistent with the current market.)
Detectability, design arounds and product value are other factors to consider.
The economic evaluation of an early-stage invention is really a challenging task.
Cost, Market, Discounted Cash Flow (DCF) methods are usually used in the economic evaluation of patented products but they are not suitable to estimate the value of a new technology or an early stage invention.
Real Options methods (Compound Options, Hybrid Real Options) or a combination with other methods (Fuzzy Set Theory, Scenario Planning, Analytic Hierarchy Process or Game Theory) could be a better solution.
