The Price of Patents: How New Tax Proposals Could Transform IP Strategy with Erin Daly

A proposed shift in U.S. patent policy is sparking debate about the future of intellectual property. The idea on the table is a value-based tax that would replace, or sit on top of, the USPTO’s traditional flat-fee system. Instead of paying predictable maintenance fees, patent owners could face annual charges tied to the assessed value of their inventions. This move would dramatically change how portfolios are managed and funded.

To walk us through the implications, we’re joined by Erin M. Daly, Ph.D., Esq., founder of Daly Law & Strategy. Erin started out in organic chemistry before moving into patent law, and she’s spent her career working with biotech companies and universities on everything from early-stage research to clinical programs. That combination of lab background and legal know-how gives her a practical view of how changes in patent policy land on the ground.

We discuss why putting a dollar value on patents is never straightforward and how a tax like this could create big headaches for industries that depend on large portfolios, like biotech, semiconductors, and emerging green technologies. We also look at what startups and universities might face if they’re hit with new costs long before their patents generate any revenue.

In This Episode:

[01:57] The proposed value-based patent tax is outlined and contrasted with current USPTO fees.

[02:50] Erin explains how the new system would resemble a property tax on intellectual property.

[03:49] The U.S. has historically treated patents as a right supported by fees, not as taxable assets.

[04:42] The proposal is still at the idea stage with no formal rule or bill introduced.

[06:08] Patent valuation challenges are described, including subjectivity and lack of comparables.

[08:07] Legal questions emerge about USPTO authority, due process, and potential litigation.

[10:44] Erin outlines compliance concerns, audits, and paperwork burdens if the IRS were involved.

[12:49] Biotech and pharma are identified as sectors most at risk under a value-based tax.

[13:45] Semiconductor and AI industries could face massive valuation tracking costs.

[14:40] Green tech companies may abandon patents if taxed before commercialization.

[15:59] Strategic steps for tech transfer offices and companies to assess exposure are discussed.

[17:39] Trade secrets may become more appealing as an alternative to patents in some cases.

[18:24] Companies might restructure portfolios or shift filings internationally to reduce risk.

[20:45] Erin emphasizes the importance of monitoring Congress, Federal Register updates, and IRS guidance.

[22:55] Coalition groups and bar associations begin mobilizing to oppose the tax proposal.

[23:33] Early legal challenges are expected to test the limits of USPTO authority and valuation disputes.

[25:26] We close with a reminder that patent costs are under increasing scrutiny.

Resources:

AUTM

Daly Law & Strategy

Erin M. Daly, Ph.D. - LinkedIn

Daly Law & Strategy - Facebook

USPTO (United States Patent and Trademark Office)

Federal Register

BIO (Biotechnology Innovation Organization)

Intellectual Property Owners Association (IPO)