Selling Patents at Auction: An Empirical Analysis of Patent Value

Abstract

This paper analyzes the impact of patent bibliographic indicators and patent characteristics on the economic value of patents put on sale in an auction, considering different typologies of sellers and buyers. A unique dataset covering all patent auctions held until the end of 2008 by Ocean Tomo is used. We employ two measures of patent value drawn from the auction process: the offer price (ex-ante value set by the seller) and the closing price (the market-value determined by the buyers) of patent lots. We find a positive correlation between forward citations and the economic value of patents, while backward citations have a positive and significant impact on the lot offer price, but turn to be negatively related to the lot closing price. The number of claims does not affect significantly the lot offer price, while it has a clear positive impact on the lot closing price. Also, the degree of technological congruence of the patents included in a lot, which is positively and significantly related to the lot offer price, turns to be still positive but not significant if we consider the lot closing price. This evidence is interpreted in the light of the different typologies of buyers and sellers participating at the auction event.