#91 IP in MedTech

00:00:01: Welcome to the IP Market Signals series from IP Management Voice.

00:00:05: Based on OFB-IP market research group analysis, this series explores the industries technologies and market developments that are shaping the demand for intellectual property expertise.

00:00:16: each episode highlights key topics driving current discussions influential market voices emerging needs among innovators in businesses an opportunities for ip experts created by these trends.

00:00:29: In this episode, we examine the IP market signals shaping medical technologies.

00:00:36: Welcome to today's Deep Dive!

00:00:38: We have got a massive stack of legal intelligence, market data and IP case law in front us today... ...we

00:00:46: really do.

00:00:46: it's quite a lot get through.

00:00:49: Yeah our mission is decode the hidden architecture of the medical technology industry in Europe because if you walk into an operating room say thirty years ago Everything that mattered.

00:01:00: I mean everything the representing cutting-edge innovation was something you could physically hold in your hand,

00:01:05: right exactly

00:01:06: like the titanium joints The specialized steel scalpels the Complex tubing of a heart lung machine.

00:01:14: it was all highly tangible.

00:01:16: Yeah if you invented something groundbreaking and that era It had mass it had weight

00:01:20: head should drop it on your foot

00:01:21: Exactly.

00:01:22: And from a legal standpoint protecting your innovation Was as simple as pointing to that physical object?

00:01:29: detailing its structural dimensions and it's mechanical function.

00:01:32: You claim the hardware, you basically own the market.

00:01:35: Right but today...you walk into that exact same operating room And then most valuable tool in there might not have any mass at all.

00:01:43: Wow yeah It may be algorithm predicting a patient crash minutes before actually happens.

00:01:49: Or it is invisible data stream connecting pacemaker to cloud server half way across world.

00:01:54: And that invisible connected space is where the rules of ownership and protection are just being completely rewritten as we speak.

00:02:01: They really are, and we're looking at an industry that's currently booming beyond almost any other sector

00:02:06: right now.

00:02:07: Yeah The numbers are wild.

00:02:08: Based on market intelligence tracking European filings in a single recent year There were over fifteen thousand seven hundred MedTech patent applications

00:02:18: Which is staggering

00:02:19: It IS!

00:02:20: What truly is wild Is its success rate.

00:02:23: We're talking about an incredible seventy percent grant rate at the European Patent Office.

00:02:28: Yeah, a seventy-percent success rate!

00:02:29: Right and to put that in perspective for you... The pharmaceutical industry only sees about a thirty six percent grant right.

00:02:37: so this is one of the most active fields of innovation in the entire

00:02:40: world.

00:02:41: Okay let's unpack This.

00:02:42: how did we get from patenting?

00:02:45: A piece of surgical steel To where are now?

00:02:48: Well, the transition requires a fundamental paradigm shift in how we think about a medical product.

00:02:55: Protecting MedTech used to mean patenting a discrete physical object like we said.

00:02:59: But today, a modern medical device is rarely an isolated object.

00:03:04: It's connected health system.

00:03:05: A system?

00:03:06: Exactly!

00:03:07: It involves the physical hardware certainly but it entirely reliant on embedded software artificial intelligence diagnostics cloud hosting environments and interoperability standards that allow this device to communicate with hospitals' mainframes.

00:03:21: It reminds me of the evolution in mobile phones twenty years ago.

00:03:25: if you designed your phone just trying The physical shape, maybe the glass screen or the physical keypad.

00:03:30: Yeah, the clamshell design that sort of thing?

00:03:32: Exactly!

00:03:33: But today if you invent a new smartphone protecting the glasses almost irrelevant here.

00:03:38: to protect the operating system...the app ecosystem..The user interface and the data flow all at once.

00:03:44: That is perfect analogy.

00:03:46: but wait hasn't tech always been complicated?

00:03:49: why has medtech suddenly facing this massive strategy gap right now?

00:03:55: The strategy gap has opened up because Mentec companies are no longer just building isolated products.

00:04:00: They're attempting to design competitive control points inside highly regulated healthcare ecosystems.

00:04:05: Control

00:04:05: Points?

00:04:06: Right, traditional patent strategies that focus solely on hardware they fail completely.

00:04:10: here I mean a patent of physical biometric wearable is functionally useless if the competitor can legally copy software algorithm That actually interprets sensors data.

00:04:20: Ah see... The financial value isn't in plastic band right The value is in the predictive system that tells you your heart is in trouble.

00:04:27: Which means software and specifically artificial intelligence, Is the engine driving this entire complex web?

00:04:34: You really cannot talk about modern medtech without talking about AI.

00:04:38: Absolutely not.

00:04:39: And looking through source notes we have here... ...the code itself isn't even the most vital asset anymore It's the data.

00:04:45: Yes

00:04:46: Ben Chapman at Cartmails & Ransford points us out explicitly In the Intelligence We Reviewed.

00:04:51: He notes-and I'll quote this The heart of many AI implemented innovations will be a model which has been trained on a set of training data.

00:05:00: So the data is the core?

00:05:01: Exactly, he treats that training data as a core protectable asset in AI MedTech not merely some.

00:05:08: you know technical background.

00:05:10: It is the literal fuel That makes the algorithm actually capable of diagnosing a patient.

00:05:15: But if you are trying to patent a system driven by AI how do you even define who invented it?

00:05:22: I mean, i was looking at the end sites for Marks and Clerks specifically Thomas Brock and Julian Asquith along with Annabelle Williams.

00:05:27: Right

00:05:27: yeah

00:05:27: They issued a really stark warning about the risks associated with investor readiness And The Unified Patent Court.

00:05:33: they state quote patent applications from medical technologies developed using AI most clearly identify human inventors and Document their inventive contribution

00:05:42: which is a huge hurdle.

00:05:44: Yeah, you can't just slap AI on the inventor line of a patent form.

00:05:47: No!

00:05:47: You definitely can't.

00:05:48: Documenting that contribution requires mapping out exactly what The Human Engineer did versus What The Machine Generated.

00:05:55: Wow

00:05:56: so Line by Line?

00:05:57: Essentially yeah I mean Did The Human curate specific data sets?

00:06:00: Did they design A novel reward function for the machine learning model?

00:06:04: If you fail to meticulously document That human contribution Your entire Patent could be invalidated during litigation.

00:06:10: It's

00:06:10: thrown out

00:06:11: Exactly.

00:06:12: But relying solely on patents creates a massive vulnerability, which is why the industry's pivoting.

00:06:18: Amy Kelly from HGF frames The Modern Approach

00:06:21: perfectly.

00:06:22: What does she say?

00:06:23: She positions AI med tech protection not as an either or choice but as dual strategy.

00:06:30: In many cases A hybrid approach can offer best balance where patents are used for core functional inventions while trade secrets protect supporting data and practices.

00:06:40: If I patent the AI's core function, but to keep that training data a secret isn't that like patenting a brilliant new restaurant concept?

00:06:49: But keeping the exact recipe locked in a vault.

00:06:51: Let's take an analogy step further.

00:06:53: actually it is not just locking the recipe and a vault.

00:06:56: It's recognizing that the concept of the restaurant you know The layout or service style can be seen by anyone who walks in.

00:07:03: Right!

00:07:03: Its public.

00:07:04: You pattened because its public.

00:07:06: But the thousand iterations of the sauce recipe that you tested before finding the perfect one, That lives in The Vault.

00:07:13: The thousands hours of patient data used to tune an AI remain a highly guarded trade

00:07:19: secret.".

00:07:19: But if Data is the new gold and Trade Secrets are The Vault what happens when New Laws force You To Open The Door?

00:07:27: Because with these new EU data sharing mandates I just don't see how you guarantee the Recipe stays Secret.

00:07:33: I'm looking at regulations like the European Health Data Space and the Cyber Resilience Act.

00:07:38: And that one now requires a software bill of materials, an S-bomb...

00:07:41: The famous SP bomb.

00:07:42: yeah!

00:07:42: Right?

00:07:43: ...and think of it as an SPABA Like an FDA nutrition label But for code.

00:07:47: If you are forced to hand regulators a list Of every single open source library and proprietary module in your software architecture How do you prevent your competitors from reading That Label and reverse engineering Your device?

00:08:00: What's fascinating here is that the new EU Data Act forces companies to entirely rethink trade secrets.

00:08:07: It used to be a trade secret was just something you quietly kept yourself.

00:08:11: Right, don't tell anyone!

00:08:12: Exactly

00:08:13: not anymore.

00:08:14: Now it is massive compliance exercise.

00:08:17: The legislation requires you to meticulously document your protective measures.

00:08:21: Wait really?

00:08:22: Document how keep this as a secret?

00:08:24: Yes You have to prove with an audited paper trail that you use strict access controls, encryption and specific nondisclosure agreements.

00:08:33: If a company doesn't have an airtight trail proving exactly how they protect their algorithms those trade secrets could be legally exposed through mandatory data sharing requests.

00:08:42: Oh wow!

00:08:42: Yeah...you have to proactively prove to regulators your data is secret before the force you hand over your software bill of materials.

00:08:50: Wow, so it's not just about inventing a medical device.

00:08:53: It's about building a proactive legal fortress around the data that powers it precisely which leads us to a massive trapdoor in European law because we've talked about how they protect the data systems.

00:09:05: but let's look at what european law actually allows you to protect.

00:09:07: when it comes to the physical body yeah Because there are very strict boundaries here.

00:09:12: The cornerstone of those boundaries is the European patent convention specifically article fifty three c. This is a vital piece of doctrine that outright bans the patenting of methods for medical treatment, surgery and diagnostics practiced directly on the human body.

00:09:27: Basically

00:09:27: you cannot patent medical procedure?

00:09:29: Correct!

00:09:30: The intent is clear to protect doctors but innovators still need a way to protect their investments.

00:09:36: so legal drafting becomes an exercise in extreme precision.

00:09:40: Ravi Sunevasan of J.A.

00:09:42: Kemp explains this exact mechanism used.

00:09:48: Only method claims are vulnerable to this exclusion.

00:09:51: Apparatus claims cannot be rejected under article

00:09:55: fifty-three

00:09:55: C EPC.

00:09:55: Yeah, his standpoint is that medtech patentability in Europe depends heavily on disciplined claim category drafting.

00:10:02: Okay Let me make sure I have the straight.

00:10:04: you can't patent The method of making a surgical incision remove a tumor right but you can patent the highly specialized robotic scalpel That makes the incision

00:10:14: Exactly.

00:10:15: You draft your legal claims around the spatial configuration of a physical tool rather than clinical steps for surgery itself, but boundaries of what constitutes an apparatus versus method are constantly being tested... Especially at the microscopic level with new medical materials.

00:10:33: Max Bertrand and Isabelle Stone from MuBurn Alice highlighted a crucial shift in this area—they note quote Developments in EPO case law, notably Decision T-twelve fifty.

00:10:45: two slash twenty suggest a more flexible interpretation may be emerging.

00:10:49: So they see this specific decision as opening new claim drafting opportunities for medical materials?

00:10:55: Yes What exactly did Decision t twelve fifty to slash twenty change?

00:10:59: Well it dealt with the interface between a device and material inside.

00:11:04: Often, when a material interacts with the body like say... A specialized coating that releases a drug or a material that adapts to tissue The European Patent Office would reject it Claiming the interaction itself was method of treatment

00:11:16: Because its happening inside.

00:11:18: Right,

00:11:19: but T-twelve fifty two slash twenty essentially allowed a patent by recognizing that if you draft the claim to focus on physical properties and specific purpose of material working within device rather than therapeutic effect on patient.

00:11:34: You can bypass exclusion.

00:11:38: Kind of.

00:11:38: It softens the hard line just enough to allow advanced biomaterials be protected.

00:11:43: Here's where it gets really interesting.

00:11:45: Wait, so if a brilliant surgeon invents a revolutionary new surgical technique like a method that saves thousands of lives They definitively cannot protect.

00:11:54: under article fifty three C regardless how clever The drafting

00:11:58: is correct

00:11:59: doesn't actively discourage medical innovation in Europe.

00:12:02: I mean why invented new surgery?

00:12:04: If you can own.

00:12:06: This raises an important question, and it gets to the philosophical heart of European patent law.

00:12:11: The system is explicitly designed to ensure that doctors and medical professionals are never ever restricted from performing life-saving procedures because of a patent.

00:12:20: Okay, that makes sense.

00:12:21: Yes society has decided.

00:12:23: the freedom for physicians to heal patients supersedes corporations right to exclusivity.

00:12:29: That's exactly why the burden falls on innovators to fiercely protect tools rather than clinical technique itself.

00:12:37: And we actually just saw this philosophy over corporate rights, play out in real time.

00:12:43: In a massive courtroom

00:12:45: drama he did.

00:12:46: the unified patent court The UPC recently issued a genuinely groundbreaking ruling and a case called Edwards v Merrill.

00:12:54: This is one of the first major Medtech specific cases at the new UPC.

00:12:58: what happened?

00:12:59: Edwards had a valid patent on a trans catheter heart valve And secured an injunction to stop their competitor Meryl from selling arrival valve

00:13:07: A standard patent fight where the winner gets to shut down the loser sales.

00:13:10: Except the court did something extraordinary.

00:13:13: They upheld the patent, but they carved out a life-saving exception based on the facts of the clinical environment Really?

00:13:19: Yeah Merrill manufactured their competing art valve in very specific size that Edwards didn't offer.

00:13:27: For certain occasions with specific anatomical requirements The Merrill Valve was only viable option.

00:13:33: Oh wow

00:13:34: So the Court lifted the injunction specifically for that size, allowing it to be used only if a physician confirmed there was no viable alternative.

00:13:44: So they prioritized the patient's immediate anatomical need over the absolute enforcement of the patent?

00:13:49: Exactly!

00:13:51: However we shouldn't view this as free pass for patent infringement.

00:13:54: Tobias Wittke and Axel Berger of Bardell-Paggenberg contextualize the mechanism at play here by noting quote arguing disproportionality remains high hurdle.

00:14:05: They read the Edwards v. Merrill decision as important but narrow, meaning patient access limits injunctions only in highly exceptional MedTech cases...

00:14:14: Meaning you can't just claim your knockoff device is broadly life-saving to get out of a patent lawsuit?

00:14:19: Exactly!

00:14:19: You have to legally prove disproportionality.

00:14:22: that enforcing the patent causes disproportionate harm to the public because your device is clinically irreplaceable for specific subset patients.

00:14:31: Yes The burden of proof is incredibly high.

00:14:35: You need clinical data and physician testimony proving that without your specific device, a patient has no alternatives.

00:14:41: But doctrinally it changes the entire landscape

00:14:44: I bet

00:14:45: It proves.

00:14:45: in European medtech A patent injunction is not an absolute weapon when human lives are immediately on line.

00:14:52: Okay, so we have this incredibly complex landscape.

00:14:55: You've got hybrid AI models requiring massive trade secret documentation software bills and materials threatening to expose data rules against patenting procedures And courts lifting injunctions based on clinical disproportionality.

00:15:08: It's a minefield

00:15:09: it really is which brings us to the harsh business reality of all This.

00:15:12: how does anyone actually afford to navigate?

00:15:14: We're talking about massive multinational giants having entire armies of IP lawyers.

00:15:19: But what about the little guys?

00:15:20: The pressure on startups and small to medium enterprises is immense, especially when they hit the stage where they are looking for venture capital or going through M&A due diligence.

00:15:30: Right.

00:15:30: Investors aren't just checking if you have a granite patent anymore—they hire specialists to kick the tires of your entire ecosystem!

00:15:38: If you claim that AI is your main asset but don't have an audited trade secret register complying with EU Data Act, Venture Capitalists will lower your valuation by millions…or simply walk away.

00:15:51: Dr.

00:15:51: Jeanine Swarbrick of HDF really summarized this brutal reality in the intelligence we reviewed.

00:15:56: She observed, quote Many small companies feel stuck.

00:16:01: they can't afford to protect their ideas up front yet They need to share them.

00:16:04: just secure funding and market themselves.

00:16:06: yes huge problem.

00:16:07: she frames

00:16:08: medtech IP Precisely as a budget conscious portfolio architecture problem for startups an SMEs.

00:16:14: it's The ultimate catch-twenty two.

00:16:16: You need money to afford the lawyers to build a hybrid strategy, but you can't get the money without sharing the idea which exposes it being stolen.

00:16:24: So

00:16:25: what does this all mean?

00:16:26: If I'm brilliant startup founder sitting in garage with groundbreaking digital health wearable am i just doomed?

00:16:33: How do I survive against multinational giants if I cant afford massive legal fortress?

00:16:39: If we connect this to the bigger picture, The Outlook leading into twenty-twenty nine actually provides a very clear survival roadmap.

00:16:46: Startups survive by completely abandoning the old patent.

00:16:49: everything model

00:16:50: really just abandoned it.

00:16:51: yeah

00:16:52: filing patents globally for every piece of software code is too expensive and often ineffective anyway.

00:16:57: instead they must deploy targeted budget conscious portfolio architecture.

00:17:02: What does that actually look like in practice for a software heavy medical device?

00:17:06: It means leveraging new tools designed specifically for the digital age.

00:17:10: For example, The New EU Design Act recently went into effect.

00:17:13: it significantly expands what can be protected quickly and cheaply.

00:17:17: And now allows companies to register Digital Graphical User Interfaces GUIs as well as Digital Animations and even the CAD files for three D printed implants.

00:17:26: So using the New EU design act To protect the visual interface of your patient app while keeping the AI algorithm a strict trade secret.

00:17:35: That's like a bank prioritizing a highly visible state-of-the art security door out front to deter casual thieves, rather than spending millions trying to patent and it keeps the real value hidden from the public record.

00:17:53: That is exactly how modern portfolio architecture works, you lock down.

00:18:01: You use strict NDAs and segmented server access to keep the core diagnostic AI algorithm locked down as an internal trade secret.

00:18:09: Okay, so... And you only spend your limited patent budget on the absolute core hardware innovation or the most unique functional integration?

00:18:16: You survive by being surgically precise with your legal budget until you secure that series A

00:18:21: funding.".

00:18:22: It's about recognizing that intellectual property isn't a single hammer — it's entire toolkit—and

00:18:30: Looking toward twenty-twenty nine.

00:18:32: mastering this system level protection is going to be the only way for companies, large or small To thrive.

00:18:38: The firms that understand how to translate This complex web of patents trade secrets design rights and data regulations into clear business decisions are the ones That will dominate the health care market.

00:18:50: it really Is a totally new frontier so Let's recap the journey you and I just took.

00:18:55: We started by looking at the massive structural shift in medtech, moving away from isolated physical devices like that old titanium joint to these vast connected digital health ecosystems that require competitive control points.

00:19:09: We explored the delicate mechanics of the hybrid model where companies patent their core apparatus functions while fiercely guarding their AI training data as trade secrets, which is a strategy requiring massive documentation to survive.

00:19:24: We navigated the strict drafting requirements of The European Rulebook, where you can't patent a medical method under Article fifty-three C but you can protect the robotic tools advanced materials use to perform it.

00:19:37: And we unpacked the clinical disproportionality test used by the Unified Patent Court to balance corporate exclusivity against the ultimate goal of saving patient lives.

00:19:47: Finally, we looked at how the next generation of innovators can survive this gauntlet by abandoning the patent Everything Mindset in favor of smart budget-conscious portfolio architecture utilizing tools like the EU Design Act to protect their digital interfaces.

00:20:03: Which brings us But before we go, there is a lingering thought here that stretches far beyond the business side of this intelligence.

00:20:12: Because

00:20:12: as these medical devices become completely integrated with our physical bodies—synced continuously to our smartwatches and tied into global AI databases —the intellectual property protecting these systems isn't just about corporate profit margins or venture capital valuations anymore... It's

00:20:27: bigger than that!

00:20:28: Much bigger….

00:20:29: It is rapidly becoming a question of who ultimately owns and controls the digital blueprints to human health itself.

00:20:49: this

00:20:59: audio briefing is based on a comprehensive IP market report produced by the OFB IP Market Research Group.

00:21:07: If you'd like to explore the topic in greater depth, You can download the full report using the link provided.