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IP strategy: new opportunities for Japan

Identifying profitable IP management strategies

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Published on October 28, 2020

Japan is an extremely prolific country in terms of scientific discoveries and patent filing. However, Japanese companies, big corporates and SMEs alike, are used to handling IP in different ways from what we see in other ecosystems. In this short article we summarise some characteristics of IP management in Japan, and identify strategic guidelines for more profitable IP management.

Local perspectives on IP handling

Japanese startups are used to applying to protect their core IP. Yet, since filing for patents in territories outside Japan can be expensive, startups tend to prioritise local protection over international applications and, as a result, they often miss out of profitable opportunities.

Historically, there has been fierce IP competition among large Japanese corporates. This was due mainly to the local patenting system not offering high levels of protection. In fact, Japanese patent publications are renowned for disclosing major technical information about inventions to the global market. The result has been that firms sought to secure as many patents as possible to secure higher levels of protection; some even filed multiple patent applications to protect one single invention. This strategy has turned out to be highly inefficient and is obviously unsustainable in the long term.

Things have changed over the years. In the last decade Japanese corporates have started to take an interest in IP repositioning as a strategy to generate more income and to differentiate from the competition. A successful example of this is a major Japanese pharma company, who produced a drug compound which failed safety tests. The successful repositioning of the drug’s application to the fields of agricultural and flavouring chemicals enabled the company to fully exploit a patent that had failed to meet compliance in the pharmaceutical industry. Similarly, a Japanese automotive company who patented AI and robotic technologies is now seeking partnerships with robotic medical device producers.

Another crucial element interlinked with IP strategy is innovation mindset, which can be as determinant as technical knowledge when it comes to commercialising new discoveries. This is an approach to IP that Japanese companies are developing and will have to strengthen further in the future to remain competitive. By shifting the focus from filing patents to generating more value from existing IP portfolios, Japanese R&D managers will become catalysts for new ways of thinking about IP, and will promote intrapreneurial thinking within their departments.

Where are we heading?

The competitive landscape is changing. To ensure that IP continues to generate value unlocking new streams of revenue, firms must embrace new strategic ways of managing IP portfolios. One way to do this is to conduct regular IP landscaping exercises to ensure that opportunities for repositioning are identified and exploited. Other options include the creation and nurturing of international partnerships, which will increase the chances for Japanese firms to attract overseas investment, adding value to their existing innovation ecosystems.

At Oxentia we support companies around the world in discovering the best strategies to create value from their IP. In Japan, we collaborate with multinational corporates, research institutes, and startups, ensuring that their IP policies and strategies are fit for competing globally with the maximum return on investment. Thanks to our insights into multiple innovation ecosystems around the world, we continue to foster the creation of partnerships between Japan and global stakeholders. We are proud and honoured to play an active role in the positive changes that Japan is undergoing in IP management, and we look forward to seeing many more clients and partners achieve success.

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