The situation

The company had developed a medical device which, according to its market research, had a large potential market in Europe, North America and Japan. To develop this potential, the company needed as wide a patent protection as possible. To procure and maintain this protection is very expensive for a small company. To commercialise a medical device in different regions and countries requires extensive testing and licensing procedures before sale of the product can begin and a return on investment achieved.The company explored different options to secure the necessary funding, for example from business angels (risk capital). It also considered selling the rights to some big international companies. All these options were unattractive. Investors expected the international patent procedures to have begun before they were willing to start serious negotiations on the terms for funding or purchase. The patent costs would, in any case, remain with Ari’s company irrespective of the results of the negotiations with potential investors.Ari was in a very difficult situation as he did not wish to relinquish a profitable new product but did not have the financial resources to build and maintain patent protection during the period of launching the product into the new market areas.

The process

Ari had heard that the Foundation for Inventions in Finland offered funding for Finnish companies and product developers to secure patent protection and to complete product development work but he thought that it had very tight terms for funding. However, in his difficult situation, he decided to contact the Foundation. First, he discussed his problems with the regional invention advisor in his home town, Lahti, who inspected the new product and the company undertaking the development work. Ari then submitted an application for funding to the Foundation and was surprised how quickly it was dealt with as he was invited to discuss the financing at the Foundation headquarters only a couple of weeks later. A positive funding decision was made two weeks after that.Under the terms of the funding, the Foundation promised to participate both in the completion of the product development and in the planning and realisation costs of the patenting strategy.

The outcome

Ari was very satisfied with the support his company received. At the beginning, it appeared that a small company could not handle international patenting of its product and he would have to give up the project. Later, with the assistance from the Foundation for Inventions, he could survive the period with no income from the product but costs were high. Another important factor for Ari was that the patenting could, with the help of the Foundation’s support, be commissioned to an experienced, large patenting office, which was able to deal with all the patenting-related questions in different countries while his company was able to concentrate on the testing and experimenting required for the commercialisation. The assistance from the Foundation for Inventions speeded up the commercialisation process by at least one year.

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Learning points

Ari says it pays off to contact the authorities. There are so many prejudices and rumours about the lengthy application procedures but, once you make the first move, the threshold proved not to be so high after all.

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