How Important is Strong, Reliable Intellectual Property Security?
The short answer? Very.
To understand why, consider the outsize importance of intellectual property on the success of individual companies and entire economies.
According to previous research from SICPA, “Intellectual property accounts for more than 80 percent of a company’s overall value, thus infringement in this area can erode one’s reputation, revenue and profits.” The value of intellectual property is reflected economy-wide: “[intellectual property right]-intensive industries generated around 84 million or nearly 40 percent of all jobs in the EU during the period 2014-2016 and accounted for around 45 percent of the EU GDP, worth some €6.6 trillion annually,” according to data from the European Union Intellectual Property Office.
Intellectual property’s value also makes it a prime target for bad actors.
“Illicit trade in counterfeit goods, piracy of Intellectual Property, and related transnational criminal activities … are estimated to cost between 8 and 15 percent of global GDP,” according to SICPA. In the European Union, for example, intellectual property right infringement related to pharmaceuticals alone results in nearly €10 billion of lost revenue for companies every year; for cosmetics and personal care, more than 10 percent of overall annual sales are lost to counterfeiting and other illicit activity.
The scale and urgency of the challenge demand robust intellectual property protections.
And we’re not only talking about protection for the sake of preventing lost revenue. Counterfeiting and illicit activity - of pharmaceuticals, safety products, and other goods - puts the health and safety of consumers in danger, and slows the development of critically important solutions. This is especially true in the context of COVID-19, in a recent blog post, the Global Innovation Policy Center (an affiliate of the U.S. Chamber of Commerce) wrote, “IP is more important than ever and its benefits are even greater. To truly fight back [against COVID-19], we need millions of dollars’ worth of private sector research, manufacturing, and distribution know-how. … Strong, consistent rules on intellectual property … will be key in beating back this immense challenge.”
So what does effective intellectual property security look like?
Beyond the systemic efforts to identify and shut down illicit actors, counterfeit-resistant physical security features are key. Visible security features - like stamps and labels - on individual products can increase consumer confidence and provide easy brand identification; they can also incorporate covert security features that increase the challenge for prospective counterfeiters. Fully invisible security features embedded into individual products or packaging add an additional layer of security, while still ensuring confidence for business owners and officials. These solutions provide transparency and accountability at every step of the supply chain and, “during investigations, they provide robust, immediate and indisputable authentication and therefore court admissible evidence, allowing the IP team to establish facts that will enable quick and decisive legal actions in full confidence of IP infringement.”
As the importance of intellectual property continues to increase - in response to global crises like COVID-19, and in the health of individual businesses and the international economy - and as counterfeiters and illicit actors become more and more sophisticated, companies and public officials must be proactive in their adoption of strong, reliable security solutions that safeguard critical intellectual property, minimize lost revenue, and protect the health and safety of consumers.
