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Inventing the wheel, patenting perpetual motion II: the art of wasting money

The fact is that research is a risk investment that may not have successful results and this forms part of the game that every investor assumes. If the majority of these research projects with negative results can be easily avoided we are talking about the art of wasting money and the production of what, in economics, are known as sunk costs.

This occurs more often than most of us think and many patent offices have sounded the alarm:

The World Intellectual Property Organization (WIPO) indicates that around 30% of the research carried out in Europe is done on areas that have already been investigated (1)
The European Patent Office (EPO) calculates the cost of duplicate research in Europe to be 20 billion Euros per year (2)
The Austrian Patent Office increases this amount to 60 billion Euros per year (3)
The UK Intellectual Property Office puts it at 20 billion pounds per year (4)
The Spanish Patent and Trademark Office (SPTO) indicates that around 25% of research in Europe is carried out on areas that have already been investigated (5)
Sources that quote the European Commission increase this amount to 32 billion Euros per year (6)
But, unfortunately, this subject has still not been the object of an in-depth study, despite the seriousness of the data been taken into consideration, clearly reflected by the disparity between the amounts. This is only being detected in a more precise manner by the Patent offices themselves, “downstream”, when the investment has already been made which means that when the patent is applied for the search reports show other research that has already been published, indicating that the result is not innovative.

Spain is not an exception within Europe. According our calculations (6) somewhere around 62% of the “search reports” on directly approved

Spanish patents show problems regarding innovation and/or sufficient inventiveness (2). Fortunately, the best ratio comes, by far, from Public Institutions and the actual overall figure is probably somewhat better, given that part of these negative reports may be due to the extension of the claims of the patent applied for.

The truth is that, looking backwards and in the light of this information, the number of patent requests in Europe has remained unchanged into the twenty first century and is similar to those registered in the times of Victorian England.

The good news is that, today, a large part of this duplication of research can be avoided thanks to our information systems. Instruments such as the preparation of reports on technology intelligence or prior reports about patentability which, although not all, might drastically reduce the levels of duplication.

The bad news is that these mechanisms are not in common use. Less than 10% of direct patent applications in Spain are carried out with a prior patentability study or, even worse, the first data issued by the SPTO, indicates that their use is becoming more and more infrequent.

(1) http://www.icsti.org/IMG/pdf/VTTImpactofPatent.pdf
(2) http://www.epo.org/searching/essentials/business.html
(3) http://www.patentamt.at/geschaeftsbericht2008/en/praesident.html
(4) http://www.wipo.int/edocs/mdocs/innovation/en/wipo_ifia_bud_98/wipo_ifia_bud_98_2.pdf
(5) http://educacionypi.oepm.es/uni_esp.html
(6) http://cincodias.com/cincodias/2002/05/22/empresas/1022159684_850215.html
(7) Random sampling carried out on 100 patents published in 2012, 56% show problems regarding innovation and only 6% of the rest demonstrate sufficient inventiveness.
(8) Source SPTO activities report 2012 http://www.oepm.es/es/sobre_oepm/MemoriaActividades/

Carmen Sánchez-Puelles