Monday, January 9, 2017

ROI for Patent Licensing, Japan Lagging far behind the Netherlands and Israel


Nikkei shows interesting figures on the relationship between (i) research expense and the number of patent applications and (ii) research expense and patent royalty income, which are generated based on the "Results of the Survey of Research and Development" and the OECD "Main Science and Technology Indicators", and comments that the characteristics of Japanese inventive faculty is "quantity over quality", indicating that Japan lagging far behind the Netherlands and Israel in the ratio of patent royalty to research investment, while Japan wins the No. 1 position in the number of international patent applications generated by a hundred million dollar research expense. 

The right figure shows the relationship between research expense and patent royalty income. The Y axis indicates the annual patent royalty income (in a hundred million dollars) received from overseas, and the X axis indicates the ratio of patent royalty to research investment. The Netherlands has roughly the same annual patent royalty income as Japan, but as for the ratio of patent royalty to research investment, that of the Netherlands is more than 160%, while that of Japan is less than 20%. That of Israel is also high, i.e. about 110%. It is certain that Japan is lagging far behind these two countries, but it appears reasonable to regard these two countries as exceptional. 

Both the Netherlands and Israel are small countries, smaller than Japan. The number of patent applications is also smaller than Japan. As for the technical field of patent applications, the Netherlands and Israel file the most in the field of "Medical technology", while Japan files the most in the field of "electrical machinery, apparatus, energy". Investing most in medical technology may be one of reasons that the ROI of the Netherlands and Israel is high. It might be interesting to research these two countries. 


Japan
Netherlands
Israel
1
Electrical machinery, apparatus, energy
Medical technology
Medical technology
2
Computer technology
Electrical machinery, apparatus, energy
Computer technology
3
Optics
Computer technology
Pharmaceuticals
4
Transport
Measurement
Digital communication
5
Semiconductor
Basic materials chemistry
Measurement

Source: WIPO statistic database - patent publication by technology in 2015

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