Inventors and companies often view patents as indispensable assets. They protect innovations, deter competitors, and can generate licensing revenue. Yet there comes a point when keeping every patent alive no longer makes financial or strategic sense. Knowing when to abandon a patent, and allowing it to lapse intentionally, can save money and refocus resources on innovations that matter.
Maintenance fees: the key decision points
While it is possible to expressly abandon your patent, most patent abandonments result from the nonpayment of maintenance fees. In the United States, utility patents require maintenance fees at 3.5, 7.5 and 11.5 years after issuance. At each of these checkpoints, a significant proportion of patents lapse because owners decide not to pay the fees. Around 20–30% of patents lapse at 3.5 years; by 11.5 years the drop?off rate reaches 60–70%. Each of these payment windows is an opportunity to reassess whether your patent is worth keeping.
Cost versus value
Patents come with ongoing expenses: maintenance fees, administrative costs, and potential enforcement costs. Fees increase over time and multiply if patents are held in multiple countries. If a patent is not generating revenue or licensing interest, continuing to pay may not be justified. Regular audits help identify patents that on not generating a positive return on investment.
Market relevance and product life cycle
Technologies evolve, products come and go, and business strategies shift. Patents covering outdated or irrelevant technologies may become a distraction. For example, a company that pivots from hardware to software might let old hardware-related patents lapse. Similarly, patents tied to products nearing end?of?life often lose strategic value.
Strategic alignment
Abandoning your patent should align with your business goals. Patents that no longer support core products or future direction can be candidates for abandonment. However, if a patent still offers a competitive edge, blocking competitors or providing licensing opportunities, maintaining it could be worth the cost.
Competitive and defensive considerations
If you allow your patent to lapse, your previously protected technology moves into the public domain. This opens the door for your competitors to use or build upon your invention. Before abandoning your patent, assess whether keeping the patent as a defensive measure outweighs the costs, particularly in fast?moving industries where technology is still relevant.
Best practices for deciding when to abandon
- Conduct regular audits: Evaluate each patent’s financial performance, market relevance and strategic alignment.
- Analyze costs and revenues: Compare maintenance and enforcement costs against current and projected revenue or licensing income.
- Monitor market trends: Determine if your patent covers a technology that is still growing or has become obsolete.
- Involve stakeholders: Engage legal, technical and business teams to ensure decisions align with overall strategy.
- Consider licensing or sale: If you no longer plan to use the patent but it still has value, licensing or selling it could generate revenue instead of letting it lapse.
Final thoughts
Abandoning a patent isn’t defeat; it is a strategic decision. By reassessing the value of every patent at each maintenance?fee milestone and considering market and business changes, your company can maintain a lean, focused portfolio. This approach reduces unnecessary costs and frees your resources to protect and develop innovations that truly drive growth.
Need help deciding which patents to keep or let lapse? Consult an experienced intellectual property attorney who can help you navigate maintenance fees, licensing opportunities and portfolio optimization.
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