NEWSRELEASE
For Release: April 23, 2003
Contact: John McDowell
(202) 205-6941
john.mcdowell@sba.gov
SBA Number: 03-19 ADVO
Small Firm Inventions Often Unprotected In The Global Marketplace
Study Shows Small Firms Patent Abroad Less Often Than Larger Firms
WASHINGTON, D.C. - A new study shows that small U.S. firms are not protecting their inventions through foreign patents as often as large firms. This lower rate of foreign patenting results in fewer commercial opportunities and lost revenue, according to the report issued today by the Office of Advocacy of the SBA.
The report, “Foreign Patenting Behavior of Small and Large Firms: An Update” written by Dr. Mary Ellen Mogee, points out that smaller firms are increasingly protecting their inventions in the global marketplace through patents. However, they still patent abroad less than larger firms do, and they allow their patents to lapse more often, as well.
“Small firms are incredibly inventive,” said Thomas M. Sullivan, Chief Counsel for Advocacy. “But many times they are unable to protect their inventions in the global marketplace, due to their inability to secure foreign patents. If small firms are unable to protect the results of their hard work, our country could lose its most valuable source of new ideas and innovations,” he said.
The author reviewed recent literature to determine reasons behind small firms’ patenting behavior. The reason cited most often for small businesses’ failure to patent abroad is lack of financial resources. Moreover, a 2002 GAO report found that the most important impediment is foreign patent costs. That report highlighted other barriers, including small firms’ limited resources, limited foreign patent knowledge, differences in foreign patent systems, and weak enforcement in some countries.
The report released today also confirmed the innovative nature of smaller firms. It found that patent value measures based on the number of other citations showed small business patents to be more valuable than large business patents in all years studied. This result reinforces the conclusions of another recent Advocacy-funded study, “Small Serial Innovators: The Small Firm Contribution to Technical Change.” Taken together, these reports clearly indicate that America’s technological innovators are found in small firms.
For more information, visit the Office of Advocacy website at
www.sba.gov/advo.###
Created by Congress in 1976, the Office of Advocacy of the U.S. Small Business Administration (SBA) is an independent voice for small business within the federal government. Appointed by the President and confirmed by the U.S. Senate, the Chief Counsel for Advocacy directs the office. The Chief Counsel advances the views, concerns, and interests of small business before Congress, the White House, federal agencies, federal courts, and state policy makers. Economic research, policy analyses, and small business outreach help identify issues of concern. Regional Advocates and an office in Washington, DC, support the Chief Counsel’s efforts. For more information on the Office of Advocacy, visit
www.sba.gov/advo, or call (202) 205-6533.