IP strategy insights: Cochlear

Cochlear Limited is one of Australia’s high tech success stories. Its hearing implant technology has been exported around the world and improved the lives of thousands of deaf people. Cochlear was named by Forbes in 2011 as one of the world’s most innovative companies.

Derek Minihane is head of IP strategy at Cochlear and was recently named to the IAM 300 IP Strategist 2015 list. Prior to joining Cochlear, he held senior IP-based positions with US technology companies.

With all this experience, I couldn’t wait to discuss patents and technology with Derek. Cochlear have kindly agreed to reproduce part of our discussion here.

Derek’s comments will be relevant to anyone making decisions about what and where to patent.

Justin: As well as being responsible for IP Strategy, you also run the research and technology program for technologies that are five to ten years away.  How important is it that you are part of the R&D organization?

Derek: IP needs to be tightly integrated with the direction of the company and developing technologies. Having the IP department within the R&D organization facilitates that integration and my managing both the IP and R&T work has also helped.  Within our IP process, marketing and research managers are engaged with IP and apply their significant technical and commercial acumen to our IP strategy. It’s important to create a strong IP culture so that IP is part of the fabric of the company from the Board on down.

Justin: Can you tell me about Cochlear’s approach to IP strategy?

Derek: It’s critical to know our IP and why we are filing patents. We have a written strategy that is updated every two years. The strategy sets out our approach to patenting and why we patent. It also sets out what factors we use to decide what and where to patent. This strategy was, and is regularly, discussed with the senior management and our Board to ensure alignment.

Justin: I understand that each of your product systems have tens of inventions in them. How do you decide what to patent?

Derek: We can only patent a limited number of our inventions due to resource limitations, but perhaps more importantly there are some inventions that are not suitable for patenting.

Before we patent an invention, we investigate its novelty, its commercial relevance to Cochlear, the likelihood that a competitor will adopt it, and whether we could detect patent infringement. To a company like Cochlear, if we can’t detect infringement then it may not be worthwhile filing a patent. We try to keep those inventions secret instead.

Inventions are evaluated at many levels, including by a technical person close to the technology, by senior managers to evaluate commercial value, and by the IP team to determine novelty.

Justin: There are too many countries to file patent applications in all of them. How do you decide were to file patents?

Derek: Where your markets are and where your manufacturing is based may be more important than where you are headquartered.

Cochlear is headquartered in Australia but our main markets are in the US, Europe and China. IP plays a very important role in protecting our products in these markets. Our filing strategy is informed by where the most important implantable hearing markets are, and where we and our competitors manufacture.

Another issue is enforceability. We may not file in countries where patents are hard to enforce. We’re pleased that China is now strongly behind IP enforcement and are updating their laws in a proactive way. I am a big fan of patenting in China and it is a tier 1 country for Cochlear.

Justin: On the issue of enforcement, is there anything you do to make your patents more enforceable?

Derek: As well as broad umbrella patents, we file patents that have a relatively narrow scope, including for variants of our products. It’s nice to have broad umbrella patents but there is always the risk that a broad umbrella patent is invalid because, for example, a prior art document is missed or a court takes a prejudicial view for some other reason.

It is harder to invalidate a narrow patent than a broad umbrella patent, and even harder to invalidate many narrow patents simultaneously. Ultimately, this greatly increases our enforcement position. Also, we build a portfolio of patents that have present value and potential future value, as the longer term direction of technology and the industry is harder to crystal ball.

Justin: What other forms of intellectual property do you use?

Derek: We use trade secrets and actively pursue non-disclosure agreements. Our people are educated on what they can and can’t disclose and how to speak to third parties whether they are customers, partners, vendors, or others.

We have used copyright to stop people copying our datasheets and imagery.

Our brands are protected by trademarks because they are valuable. We monitor for inappropriate use of our trademarks.

Justin: Thank you, Derek.

 

For further information about IP strategy, please contact Justin Blows, j.blows@phoenixip.com.au.