Utility patents

The most common form of patent — protecting new, useful, and non-obvious processes, machines, manufactures, or compositions of matter — and the primary subject of IP litigation finance in the technology, pharmaceutical, and biotech sectors. Utility patents run 20 years from the earliest effective filing date, subject to maintenance fees, and are the vehicle for the vast majority of high-value patent disputes. In litigation finance, utility patent underwriting centers on claim validity (anticipation and obviousness over prior art), claim scope, and damages methodology — with IPR vulnerability, claim construction risk, and damages expert credibility as the primary value drivers. Utility patent cases in the pharmaceutical space frequently involve paragraph IV ANDA challenges, which carry their own specialized timing, burden-shifting, and injunction rules that funders must account for separately.

Utility patent underwriting is built around three sequential risk gates — validity, claim construction, and damages methodology — and funders size commitments only after independently stress-testing all three, since strength on any one dimension does not offset weakness on another. Pharmaceutical utility patent cases carry an added structural layer: Hatch-Waxman paragraph IV timing and automatic stay provisions change both expected duration and settlement dynamics relative to a standard technology infringement case, requiring a separate underwriting framework for ANDA litigation.