WoundZipper Licensing Program FAQ's
The intellectual property associated with the WoundZipper is currently available for licensing. Below are the most common questions a potential licensee is likely to ask before negotiating the terms of a license:
WHAT IS BEING LICENSED?
The license will include: (1) the U.S. Patent for the WoundZipper; (2) the patent applications for the continuation application derived from the original patent application; (3) the patent application containing improvements to the original WoundZipper; (4) The trademark rights to the WoundZipper and its distinctive logo; and, (5) the general technology and know-how relating to the WoundZipper.
HAVE ANY PATENTS BEEN ISSUED FOR THE WOUNDZIPPER?
Yes, on November 8, 2016, the U.S. Patent Office granted United States Patent No. 9,486,217 for the Woundzipper.
WHAT DOES THE WOUNDZIPPER PATENT COVER?
The ‘217 patent broadly covers the essential features of the WoundZipper. At a general level, the patent covers the use of flexible magnetic strips of opposite polarity secured to each side of a wound. After proper positioning of each magnetic strip, the magnets are permitted to attract each other thereby closing the wound. The WoundZIpper is an elegant solution, which replaces time consuming, scar prone, and fear inducing devices such as sutures and staples, and replaces other less effective wound closure devices such as Steri-Strips that fail to close the wound uniformly along its entire length.
ARE THERE ANY PATENT APPLICATIONS STILL ON FILE?
Yes, a continuation application was filed before the ‘217 patent issued. The claims of the continuation application are broader in scope than the claims in the ‘217 patent. We see no obstacles to the issuance of the broader claims. It is expected that a second patent for the WoundZipper will issue in late 2017.
HAVE ANY PATENT APPLICATONS FOR IMPROVEMENTS BEEN FILED?
Yes, a U.S. patent application was filed on December 16, 2016 on an expedited basis for various new versions of the WoundZipper having additional features. These new versions could be rolled out as improved second and third generation versions after the original WoundZipper is adopted by practitioners. The new patent application will further extend the patent rights to the improved WoundZipper beyond the original ‘217 patent.
WHEN WILL THE PATENT RIGHTS EXPIRE?
The ‘217 patent does not expire until February 24, 2035. Patents issued from the continuation application will have the same expiration date. The new patent application with the improved embodiments of the WoundZipper will further extend the patent rights by several years beyond the 2035 expiration date of the original ‘217 patent.
ARE THERE INTERNATIONAL PATENT RIGHTS FOR THE WOUNDZIPPER?
Yes, there will be. The expedited application for the improved versions of the WoundZipper will be filed internationally.
WHAT IS THE STATUS OF THE TRADEMARK RIGHTS?
The WoundZipper trademark has been approved by the United States Trademark Office and is currently being reserved in the Trademark Office awaiting actual sales.
ARE THERE INTERNATIONAL TRADEMARK RIGHTS FOR THE WOUNDZIPPER?
The trademark rights will be reserved overseas after the licensor and licensee agree upon the essential foreign markets in which the trademark should be reserved.
WHAT IS THE SIZE OF THE MARKET FOR THE WOUNDZIPPER?
There are many applications for the WoundZipper in a variety of contexts such as doctor’s offices, surgical wards, home use, and in emergency rooms. There are a total of approximately 90 million skin-suturing procedures performed each year for emergency, non-emergency, and elective incision procedures. If one conservatively limits the market for discussion purposes to the emergency room setting, then it is instructive to note that 12.2 million wounds are managed each year in emergency rooms in the United States. If market penetration were only 5%, a licensee would still generate a gross profit of over $2.3 million per year after royalties are paid based upon the emergency room market alone and the assumptions described in the discussion of ROYALTY RATE below. If 5% market penetration was achieved in the greater market of 90 million procedures, then a licensee would generate an estimated gross profit of $17 million per year after royalties are paid.
WHAT IS THE EXPECTED ROYALTY RATE?
The average cost of goods sold is expected to be approximately $2.00 per unit with an average wholesale price of approximately $7.00. The royalty rate is expected to be $1.25 per unit on average, thereby generating a 54% profit margin for the licensee.
WILL THE LICENSE BE EXCLUSIVE OR NON-EXCLUSIVE?
We are currently seeking an exclusive licensee with minimum annual sales, which will be negotiated. Alternatively, we seek a non-exclusive licensee without minimum sales requirements.
WHAT WILL BE THE TERM OF THE LICENSE?
The initial term is expected to be 3 to 5 years with a right to renew if minimum sales targets are met.
WHAT WILL BE THE LICENSED TERRITORY?
It will be commensurate with the marketing and distribution reach of the licensee.