Patent licensing and commercialization is the practice of allowing a third party to profit from the sale and use of the licensed product. The owner of the patent grants permission for a third party to use his patented innovation in exchange for a fee and an agreement. According to what the patent owner and licensees agree upon, the license may be granted for a specific amount of time. The licensee may use the patented invention to derive financial benefits, known as “commercialization.”

The patent can be commercialized more effectively and cooperatively by issuing licenses. There are various license options available. Therefore, a patent owner (also known as a licensor) should carefully research the licensing choices, consider the earnings associated with each type of licensing, and make a decision.

A patent holder that chooses exclusive licensing can only provide one company the right to make, utilize, or export the patented product. Exclusive licensing may be given globally or only within a specific geographic area.