Direct comparison
Know-How License vs. Patent License
How know-how and patent licenses differ in scope, term, and royalties -- and why biotech deals typically bundle both.
Side-by-side comparison
| Dimension | Know-How License | Patent License |
|---|---|---|
| What is licensed | Confidential technical information: processes, formulations, protocols, operational know-how | Rights under a specific granted patent (or pending application) claim set |
| Legal basis | Trade-secret law (DTSA, state UTSA statutes) plus contractual confidentiality obligations | Patent Act, 35 U.S.C., as administered by the USPTO |
| Disclosure required to obtain the right | None -- protection depends on keeping the information secret | Full public disclosure of the claimed invention, in exchange for the exclusionary right |
| How the licensee learns to use it | Active technology transfer -- documentation, training, technical support from the licensor | Reading the published patent; no transfer obligation on the licensor beyond the grant itself |
| Term | No fixed statutory ceiling -- runs as long as the agreement specifies or the information stays secret | Capped at the patent term -- 20 years from the earliest non-provisional filing date |
| Effect of the underlying right lapsing | If the information becomes public (independent discovery, lawful reverse engineering), the exclusivity basis disappears | Once the patent expires, the invention is dedicated to the public and anyone may practice it royalty-free |
| Royalties after the underlying right ends | Can lawfully continue if the licensee still uses the confidential information and the agreement structures it as a genuine know-how royalty | Cannot lawfully continue past patent expiration on their own -- Brulotte v. Thys Co. (1964), reaffirmed in Kimble v. Marvel (2015) |
| Remedy if a third party gets the same information/invention independently | No remedy against independent discovery or lawful reverse engineering -- only misappropriation is actionable | Patent infringement does not require copying -- independent invention is not a defense |
| Enforcement mechanism | Breach-of-contract and trade-secret-misappropriation claims | Patent infringement claims under 35 U.S.C. |
Common questions
FAQ
Can a know-how license exist without any patent at all?+
Yes. Manufacturing-process, software, and early-stage biological-material licenses are often pure know-how licenses with no patent component, enforced through contractual confidentiality and trade-secret law rather than patent infringement.
Why do biotech licenses so often combine patent and know-how rights?+
Because a patent's claims often do not capture the tacit manufacturing and process knowledge needed to reliably reproduce the invention, and because a properly structured hybrid license can lawfully continue know-how royalties after the patent expires, extending the commercial life of the deal.
Can royalties continue after a licensed patent expires?+
Not as a pure patent royalty -- Brulotte v. Thys Co. and Kimble v. Marvel Entertainment make that unenforceable. A hybrid license with a genuine, appropriately reduced know-how royalty component can continue past expiration.
