Real Options and Intellectual Property

Capital Budgeting Under Imperfect Patent Protection

  • Philipp N. Baecker

Part of the Lecture Notes in Economics and Mathematical Systems book series (LNE, volume 587)

Table of contents

  1. Front Matter
    Pages I-X
  2. Introduction

    1. Pages 1-6
  3. Patenting Under Uncertainty

  4. Exogenous Patent Risk

  5. Endogenous Patent Risk

    1. Front Matter
      Pages 183-183
    2. Pages 221-222
    3. Pages 223-224
  6. Back Matter
    Pages 225-278

About this book


Over the last years, due to intensive competition in the knowledge economy, legal aspects surrounding intellectual property (IP) rights - including litigation and settlement - have continuously gained in importance. Correspondingly, professional IP management has become an indispensable element of successful value-based management (VBM) in research-intensive firms.

With this text, the author proposes an integrated approach to patent risk and capital budgeting in pharmaceutical research and development (R and D), developing an option-based view (OBV) of imperfect patent protection, which draws upon contingent-claims analysis, stochastic game theory, as well as novel numerical methods. Bridging a widening gap between recent advances in the theory of financial analysis and current challenges faced by pharmaceutical companies, the text re-initiates a discussion about the contribution of quantitative frameworks to value-based R and D management.


D Management Intellectual Property Patent Risk Pharmaceuticals/Biotechnology R & Real Options game theory stochastic game theory

Authors and affiliations

  • Philipp N. Baecker
    • 1
  1. 1.Department of Finance and AccountingEuropean Business School International University Schloß ReichartshausenOestrich-WinkelGermany

Bibliographic information

  • DOI
  • Copyright Information Springer-Verlag Berlin Heidelberg 2007
  • Publisher Name Springer, Berlin, Heidelberg
  • eBook Packages Business and Economics
  • Print ISBN 978-3-540-48263-5
  • Online ISBN 978-3-540-48264-2
  • Series Print ISSN 0075-8442
  • Buy this book on publisher's site
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