Why is intellectual property important for biotech companies?

The business model of biotech firms often relies heavily on intellectual property rights, in particular patents, as they are often the most crucial asset they own in a sector that is extremely research-intensive, high risk, and with relatively low imitation costs. 

 This is particularly the case for SMEs, many of which are relatively recently established, and an important number of which have yet to take a product to market. Often, biotechnology SMEs are established on the basis of one or more patents developed within, or in partnership with, public research organisations or universities, and thus, these intellectual property rights are essentially their products for a long time – for some, even the final product. Investors in biotech companies are generally well aware of the centrality of patents and the survival of such companies may very well depend on their ability to convince investors that they have a solid IP strategy and that risks are kept to a minimum. Therefore, a support network to ensure SMEs are protecting their IP as solidly as possible, is vital.