St. Jude IP Case Reinforces Need For Vetting Suppliers and Partners

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In the news this week was the story of a jury award of $2.3 billion to a division of St. Jude Medical against a Chinese medial device company started by a former employee. The details are specific to the case, but the news was enough to get Technomic Asia principal Michael Zakkour on one of his favorite topics, protecting intellectual property. Zakkour was traveling in the US on his way to southern China, when the China Business Podcast caught up with him for an interview on IP security strategies.

There are two main components to IP strategy for companies considering China operations, 1) a significant vetting process, the cornerstone of which is based on relationships that are proven over time; 2) a regularly enforced process to know who is working on the key areas of your product. This means organizations are notified when personnel changes in specified roles among their vendors.

Both are easy to articulate and difficult to execute. As China races to leave its low-cost manufacturing brand in the dust in exchange for being a global economic power, protecting the design and engineering elements that set your product apart is likely the most important aspect of your China strategy.