I’ve watched brands spend hundreds of thousands of pounds annually filing patents and designs for every product they could. The result? Bloated portfolios that drain resources whilst delivering zero commercial value.
One such brand engaged me over 10 years ago to implement a new approach. I still work with them today. Working closely with the managing director, we abandoned many of these rights. They provided no commercial utility. The company had patents in China despite barely selling there. They held protection for discontinued products. They’d filed designs so similar to commonplace equipment that validity was questionable from the start.
The managing director was pushed by prior patent attorneys to file, file, file—without any consideration of return on investment.
To say he was unhappy when he realised the waste is an understatement.
The Question Nobody Asks
Why?
That single word should precede every IP filing decision. Why are you making this investment? In many cases, it’s the right decision. But not always.
Unfortunately, even large companies lack a coherent IP strategy. They confuse portfolio size with portfolio value. They treat patents as trophies rather than commercial weapons.
The uncomfortable truth: most patents never recoup their filing and maintenance costs. You’re paying annual fees on rights that generate zero revenue and provide no competitive edge.
The Real Cost of Protection Without Purpose
A portfolio of 100 patents across 10 countries can generate significant annual maintenance costs each and every year.
For the client referred to above, we worked with the managing director to identify sales volumes and territories. We reverse-engineered the portfolio based on actual market presence.
The litmus test was simple: Does this right support products we’re actively selling in meaningful volumes in this territory?
If not, it was a candidate for abandonment.
Spend on IP has steadily reduced over the past decade to align with key new product development. The company now focuses protection on innovations that offer significant market opportunities. These aren’t just products. They’re systems.
That’s the threshold: systems that solve specific market problems, not product variations.
Commercial Strategy First, Protection Second
We look at the IP landscape to identify white space whilst remaining in close contact with the company to understand their commercial discussions. This is all built into the file/don’t file decision.
Just because something is a good idea does not mean a patent application should be filed.
One of the company’s primary drivers for patent protection is Patent Box. If they have a product or system that will be a key revenue driver, obtaining a granted patent offers potentially significant tax savings.
The tax benefit increased by over 66% following the rise in corporation tax to 25%. Patent Box allows qualifying profits to be taxed at 10% rather than 25%.
That’s pure commercial calculation, not just competitive protection.
Yet only 1,600 companies claimed £1.47 billion relief using Patent Box in 2022-23, despite approximately 20,000 patent applications per year at the UK Intellectual Property Office and around 90,000 R&D tax relief claimants.
The gap reveals that most companies file patents without understanding or using the commercial frameworks that give those assets actual financial worth.
The Licensing Reality Nobody Mentions
Obtaining a licensee for a patent is hard. I work with many clients who file patents with the sole aim of licensing them.
Most fail.
This doesn’t mean the patent is bad. Many larger companies simply design around a patent or use the patented invention anyway and worry about potential consequences later.
To truly benefit from patents from a licensing perspective, you need a portfolio that’s hard to design around and IP insurance to help fund pursuit of infringers. A significant investment is required to build an IP portfolio that can be licensed in any meaningful way.
Bearing in mind that IP is territorial, a strong portfolio would need to cover the UK, Europe, and US as a minimum. If you file five patents in all three jurisdictions, you’d likely spend £100,000 over five years with ongoing renewal costs for the life of the patents.
Those costs increase further when you consider potential design and trade mark protection, and the cost of building robust legal documents such as licence agreements.
The patent licensing market is projected to reach approximately £120 billion, yet the reality is sobering: most patent holders aren’t successfully monetising their portfolios. They’re either sitting on them or using them defensively.
What Makes Something Worth Protecting
When conducting IP landscape analysis to find white space, we’re looking for prior art that enables us to say why a new innovation is novel. This helps frame potential claim scope and identify whether the client has developed something groundbreaking or just an incremental invention.
Patents can be useful for both categories, but what we really want to file patents for is innovations that offer real protection. The IP backing those products can help the company command a premium price.
Claim scope becomes the commercial indicator. Broad claims mean pricing power.
For incremental inventions, a patent might allow a client to benefit from Patent Box tax relief. In other scenarios, an incremental invention might result in an improved product that offers market advantage and an opportunity to licence that patent.
But you’re essentially evaluating whether competitors would actually pay to use this incremental improvement. Theoretical licensing opportunity doesn’t automatically translate to licensing revenue.
The Divisional Strategy
One approach we take at Panoramix IP is to file a very broad initial patent that includes a comprehensive technical description and drawings. A patent can only be granted in respect of one invention in the UK and Europe.
We focus on the most useful claim set to start with and then divide the applications later to pursue alternative claim scopes.
This helps minimise costs at the outset whilst providing flexibility for the future. You’re creating optionality whilst controlling upfront costs.
The Audit Imperative
An annual review is a minimum. If a company gets to a certain size, it needs to work very closely with its IP adviser to enable proactive advice.
This does cost money, but it’s essential to ensure that new developments are protected in the most appropriate manner and decisions can be taken regarding the IP portfolio.
Without regular portfolio audits, you risk paying maintenance fees on rights that add no commercial value. Companies conducting regular portfolio audits can save substantially on unnecessary IP renewal expenses by identifying and eliminating non-essential patents.
There is no one size fits all. The frequency depends on your market dynamics, product development cycles, and portfolio complexity.
Three Non-Negotiable Principles
First: Marketing versus IP protection.
If you have the choice of investing in IP protection or marketing, carefully consider how you proceed. If the product is never pushed to its potential customer base, any investment in IP would be wasted.
Second: Realistic prospect of protection.
Is there a realistic prospect of obtaining IP protection? Why waste money on something that’s doomed to fail?
Applications with thorough novelty searching during drafting experience 62% fewer novelty-based rejections and attain 44% faster time to grant. A technology firm that incorporated professional search results into claim drafting enhanced their first-action allowance rate from 7% to 23%.
Quality driven by commercial intent beats quantity.
Third: Is what you already have enough?
Duplication can be an interesting strategy to deter challenges, but it comes at additional cost. Is trade mark protection sufficient, or do you need technical and design protection too?
For all three points, your IP strategy needs real consideration and building out.
When IP Protection Actually Makes Sense
IP protection should still be considered early, but it needs to be structured in the right way and investment should be made for the right reasons.
We offer commercial, pragmatic advice and will honestly tell you what you should be doing. We offer a free 45-minute IP clinic where you can ask any questions you might have.
The test is simple: does each asset help your business win?
If not, it’s a candidate for licensing, sale, or abandonment.
Portfolio pruning isn’t just about cost savings. It’s about focus. An optimised portfolio supports strategic decisions, adds leverage, and gives you genuine options.
Companies with strong IP management practices achieve 20% higher profit margins compared to industry averages. The differentiator isn’t portfolio size. It’s strategic IP management aligned with commercial objectives.
Before you file your next patent application, ask yourself why.
If you can’t articulate a clear commercial rationale—whether that’s Patent Box eligibility, licensing revenue, premium pricing power, or acquisition value—you’re building a trophy collection, not a commercial asset.
And trophy collections are expensive hobbies that businesses can’t afford.
