Conventional wisdom would suggest that such a dramatic shift in filing volumes should translate into corresponding changes in prosecution revenues within a few years, given the typical 3-5 year lifecycle from filing through examination to acceptance. However, publicly available financial information, particularly for the listed IPH group, has not shown the revenue declines one might expect from a 30% reduction in new filings. This apparent paradox raises questions about what is actually happening within the Australian patent prosecution system, and whether current revenue patterns are sustainable or merely a temporary phenomenon masking an inevitable adjustment.
By analysing detailed prosecution event data from IP Australia covering FY2013-25, including filing volumes, examination requests, examination reports, and acceptances across different firm groups, this article reveals a remarkable story. The data shows how factors largely outside the control of attorney firms – particularly IP Australia's examination capacity, backlog management, and recent productivity changes – have temporarily insulated the consolidated groups from the full commercial impact of their declining market share. The findings have significant implications for understanding current industry dynamics and, more critically, for assessing the medium-term prospects of different participants in the Australian patent attorney market.
Overall Patent Filing and Examination/Prosecution Numbers
Note: All annual data presented in this article is based on the Australian fiscal year (FY), which runs from 1 July to 30 June, and is conventionally identified by the end year. That is, for example, FY2025 is the period running from 1 July 2024 to 30 June 2025. This differs from my (and IP Australia’s) usual calendar year-based analysis, and so some of the annual numbers in this article are slightly different from those you may have seen previously. The trends, of course, are unchanged.
The chart below shows the annual numbers of patent application ‘prosecution events’ in Australia from FY2013 to FY2025. Each stacked bar represents a fiscal year, with coloured segments indicating the number of different types of selected prosecution events: new application filings (blue), examination requests (green), first examination reports (orange), further examination reports (grey), examination responses (yellow), and acceptances (red). The stacked format shows both the total prosecution activity in each year and the relative contribution of each event type. The height of each coloured segment reflects the numbers of that particular event, while the overall height of each bar indicates the combined level of prosecution activity across all stages of the application process.
Application filings showed moderate variation during the period. Following a spike of over 30,000 in FY2013, attributable to applications that were brought forward to beat the ‘Raising the Bar’ IP law reforms, filings dropped to around 25,000 in FY2014 before recovering. New filings exceeded 30,000 each year between FY2021 and FY2024, peaking just shy of 33,000 in FY2022, but fell back below 30,000 in FY2025.
Examination requests displayed more dramatic fluctuations. During periods of ‘normal’ applicant behaviour, IP Australia determines when examination is requested in the majority of cases, by issuing directions to request examination on (mostly) the longest-pending cases at a rate generally commensurate with its capacity to examine applications (although, as we shall see, this does not necessarily prevent a backlog from developing). Typically, applicants voluntarily request examination (i.e. without a direction being issued) in about a third of cases (e.g. 9,159 voluntary requests out of 27,221 total in FY2024). However, spikes in voluntary exam requests occurred in FY2013 – with applicants seeking to have applications examined under less stringent legal requirements prior to commencement of the ‘Raising the Bar’ reforms on 16 April 2013 – and in FY2025 – when a change in calculation of excess fee claims for applications for which examination was requested on or after 1 October 2024 may have resulted in increased costs for some applicants. As a result, exam requests surged to over 45,000 in FY2013, dropping sharply to around 10,000 in FY2014 when IP Australia – having more than enough applications awaiting examination – all but ceased issuing directions. In the relatively undisrupted period between FY2015 and FY2024, exam requests fell as low as 21,576 in FY2018 before rising to 27,243 in FY2024. A further spike to over 30,000 requests occurred in FY2025, coinciding with the fee changes implemented in October 2024.
The examination process shows corresponding downstream patterns. First examination reports, which typically issue 12-18 months after examination requests, peaked during FY2014-17 at levels above 26,000 per year. Reports then declined through the early 2020s, reaching a low point below 19,000 in FY2022, before recovering to just under 26,000 in FY2025. This pattern broadly tracks the earlier fluctuations in examination requests, with the expected time lag. Further (i.e. second and subsequent) examination reports remained consistently less common – reflecting the fact that a majority of Australian patent applications are accepted (or, less commonly, abandoned) following a single examination report. Further reports typically range between 8,000-9,000 per year, with a low point of 7,229 in FY2023, and an increase to nearly 10,000 in FY2025.
Examination responses (to first and further reports) generally track report volumes, ranging between 23,000-34,000 per year.
Acceptances, which typically follow responses by 2-4 weeks, followed a pronounced trajectory over the period. Acceptances increased from under 17,000 in FY2013 to peak at approximately 25,000 in FY2016, as pre-Raising the Bar applications flowed through the system. They then declined progressively through the early 2020s to a low of under 16,000 in FY2023. Acceptances have since recovered with nearly 20,000 applications accepted in FY2025. The decline and recovery in acceptances occurred against a backdrop of relatively sustained filing and examination activity.
A substantial majority of applications that are examined end up being accepted – between FY2016 and FY2023, for example, just over 77% of all applications for which examination was requested were ultimately accepted. It remains the case that, as I first observed back in 2021, the current examination ‘success rate’ for applicants is actually higher than during the years leading up to the Raising the Bar reforms.
Prosecution Activity in Australian Patent Attorney Firms
To assess the approximate value of patent prosecution to attorney firms, I use a rough metric I call ‘prosecution intensity’. This metric assigns weightings to different prosecution events to reflect their relative revenue (and, to some extent, attorney workload) contribution: examination requests (including activity associated with processing directions and/or applicant instructions) receive a weight of 1, examination reports and acceptances each receive a weight of 2, and examination responses receive a weight of 3. These weightings roughly correspond to the typical professional fees charged for each type of work (based on my increasingly dated personal experience – different firms, and firms within different groupings, may vary of course). The metric is scaled to be visually comparable to filing numbers when plotted on charts, though in reality total prosecution revenues are typically at least two-to-three times greater than revenues from initial application filings (again, this varies by firm/group). Numerical comparisons aside, by tracking prosecution intensity alongside filing numbers over time, we can observe whether firms' prosecution workload and revenue is tracking proportionally with their filing activity, or whether other factors are influencing their prosecution volumes.
The three charts shown and discussed below display annual filings and prosecution intensity for three distinct groups of patent attorney firms: the IPH group (firms owned by ASX-listed IPH Ltd), the QIP group (firms owned by private equity under QANTM IP), and the ‘independent’ (or ‘IND’) group (all other independent firms not part of a commonly-owned group). Firms included in each group are based upon their current composition following acquisitions and mergers, not upon the changing composition over time. (Put another way, acquisition of a firm implies acquisition of its past filing and prosecution history.) Each chart shows paired bars for each fiscal year from FY2013 to FY2025, with darker bars representing new application filings and lighter bars representing prosecution intensity. The charts allow comparison both within each group (how filings and prosecution intensity have tracked over time) and potentially across groups (how different firm groups have performed relative to each other and to overall market trends). Discussion of the data is based on the period from FY2016 onwards, to avoid the distortions caused by the Raising the Bar reforms during the earlier years.
IPH Group: Filings declined from 14,273 in FY2016 to 9,823 in FY2025, a reduction of 31%. During the middle period (FY2018-23), filings declined progressively from 13,777 to 11,252, and prosecution intensity followed a similar declining trajectory from 15,639 to 11,688. However, in FY2022-25, despite filings continuing to decline from 12,283 to 9,823 (20% reduction), prosecution intensity reversed course and increased from 12,611 to 13,924 (10% increase). Given the typical 3-4 year lag between filings and the bulk of prosecution events, the declining filings of FY2020-22 would be expected to drive declining prosecution intensity in FY2023-25, yet the opposite occurred.
QIP Group: Filings declined modestly from 4,965 in FY2016 to 4,507 in FY2025 (9% reduction). Prosecution intensity showed a similar modest decline from 6,961 to 6,058 (13% reduction) over the full period. However, like IPH, the FY2022-25 period showed prosecution intensity increasing from 5,001 to 6,058 (21% increase) while filings declined from 5,174 to 4,507 (13% reduction). Again, the filing declines of FY2020-22 might lead to a prediction of lower prosecution intensity in subsequent years, contrary to the observed increase.
Independent Group: Filings increased substantially from 9,145 in FY2016 to 14,758 in FY2025 (61% increase). Prosecution intensity increased from 11,977 to 17,817 (49% increase) over the same period. The acceleration is particularly notable in recent years: from FY2020 to FY2025, filings increased from 11,630 to 14,758 (27% increase) while prosecution intensity increased from 11,052 to 17,817 (61% increase). The growth in prosecution intensity substantially outpaced the growth in filings, particularly in FY2024-25 when filings were relatively flat (15,096 to 14,758) but prosecution intensity jumped from 15,853 to 17,817.
These patterns align with the overall examination data showing increased first reports and acceptances in FY2024-25. For IPH and QIP, the recent increase in prosecution intensity despite declining filings suggests their prosecution workload is being sustained by factors beyond their own filing activity. For independent firms, the acceleration in prosecution intensity beyond their already-substantial filing growth suggests they are benefiting both from their own increased filings and from the broader increase in examination activity.
Effect of IP Australia’s Examination Pipeline Management
The above patterns can be better understood by looking in more detail at IP Australia’s management of its examination pipeline over the period of interest. Here, I do this by looking at externally-observable metrics, namely the delay from exam request to first exam report, and the backlog of applications awaiting a first report.
The following chart shows the delay in months between when an examination request is filed and when the first examination report is issued by IP Australia, tracked across fiscal years from FY2013 to FY2025. Two metrics are displayed: the median delay and the 85th percentile delay. The median represents the midpoint of all examination delays in a given year, i.e. half of all applications experienced longer delays than shown by the blue trace. Similarly, 15% of all applications experienced delays of at least the duration indicated by the orange 85th percentile trace. Together, these metrics provide insight into both typical examination timeframes (median) and the longer delays experienced by a significant minority of applicants. These are retrospective measurements, calculated at the time each first examination report issues by looking back to determine how long the application had been waiting since the examination request was filed.
The chart below shows the number of patent applications awaiting their first examination report at the start of each month, from July 2012 through June 2025. This represents the backlog of applications for which examination requests have been filed but for which IP Australia has not yet issued a first examination report. The backlog size reflects the balance between incoming examination requests and the Office's capacity to process them: when requests exceed examination output, the backlog grows; when examination output exceeds new requests, the backlog shrinks. A growing backlog signals that the Office is failing to keep pace with requests, while a stable or declining backlog indicates that examination capacity is adequate to handle the workload. The month-to-month data reveals both longer-term trends in the Office's processing capacity and shorter-term fluctuations, including seasonal patterns and responses to regulatory changes that affect the volume of examination requests.
Again, the following discussion of the data in the two charts above is based on the period from FY2016 onwards, to avoid the (very obvious) distortion caused by the Raising the Bar reforms during the earlier years.
Examination Delays: Median delays were at their lowest in FY2016-17 (6-7 months), then increased progressively through FY2022-23 (10-12 months) before stabilizing at around 11 months in FY2024-2025. The 85th percentile showed a similar pattern, increasing from around 10-11 months in FY2016-17 to 15-17 months in FY2024-25. Since these delays represent retrospective measurements at the time of first report issuance, the data indicates that applications filed from around FY2019-21 onwards experienced progressively longer waits.
Backlog Growth and Stabilisation: Applications awaiting examination remained relatively contained at 14,000-17,000 through FY2017-20. The backlog then grew substantially, increasing from around 18,000 in mid-FY2021 to peak at approximately 26,000 by mid-FY2023. The backlog remained in the 25,000-26,000 range through September 2024, before jumping to approximately 30,000 from October 2024 onwards (coinciding with the fee change spike in examination requests) and has remained at that level through June 2025.
Office Response: The backlog grew while the Office issued first examination reports at lower rates during FY2018-23, ranging from 18,684 to 22,884, well below the FY2014-17 peak which exceeded 27,000 and the FY2024-25 rates of nearly 26,000. The recent increase in examination output has resulted in stabilisation of the backlog, although the FY2025 spike in examination requests has added approximately 3,000-4,000 applications to the queue from October 2024 onwards.
The pattern suggests the Office faced capacity constraints during FY2018-23 that limited examination output relative to the incoming workload, resulting in growing backlogs and delays. The recent increase in examination output to near-historic levels indicates increased examination capacity or productivity, which has prevented further backlog growth and is driving the increased prosecution intensity observed across all firm groups, particularly benefiting those with declining filing shares.
Conclusion – Future Prospects and Strategic Risks
The data reveals a hidden vulnerability in the business models of the consolidated firm groups, particularly IPH. While declining filing volumes would normally be expected to translate into declining prosecution revenues within 3-4 years due to the typical lag times between filing and examination, this natural relationship has been obscured by IP Australia's recent increase in examination output. IPH's filings declined from over 13,000 in FY2018-19 to under 10,000 in FY2025, yet their prosecution intensity increased from around 11,700 in FY2023 to nearly 14,000 in FY2025. This divergence is primarily attributable to the Office issuing first examination reports at levels not seen since FY2017, thereby processing applications from a period when IPH's filing volumes were substantially higher.
This situation presents a significant medium-term risk. The current backlog of approximately 30,000 applications awaiting examination includes a higher proportion of IPH and QIP applications than recent filing trends would suggest, reflecting their historically larger market shares. As IP Australia works through this backlog – whether by maintaining current high examination output levels or by further productivity improvements – the applications being examined will increasingly reflect the current market share distribution, which is less favourable to the consolidated groups. The filing data from FY2022-25 shows IPH averaging around 11,000 applications per year compared to over 14,000 for independent firms, a reversal of the historical pattern where IPH dominated. Applications filed in FY2024-25 will reach first examination during the coming years, at which point the prosecution workload distribution should begin to more closely reflect current filing shares.
Independent firms face the opposite scenario. They have been growing their filing volumes substantially (from under 12,000 in FY2020 to nearly 15,000 in FY2025) while simultaneously benefiting from the increased examination output processing their expanding pipeline of applications. Their prosecution intensity has grown from 11,052 in FY2020 to 17,817 in FY2025 – a 61% increase that significantly outpaces their 27% filing growth over the same period. As the backlog continues to be processed, independent firms will see their recent higher filing volumes translate into sustained higher prosecution workloads, potentially accelerating their revenue growth relative to the consolidated groups – and, perhaps, increasing demand for patent attorneys to cover the higher workload.
The strategic implication is stark: IPH and, to a lesser extent, QIP are currently insulated from the full commercial impact of their declining filing share by factors entirely outside their control – specifically, IP Australia's examination capacity and the composition of the current backlog. If the Office maintains or increases its examination output (as the FY2024-25 data suggests it has), the consolidated groups face an inevitable adjustment as their prosecution workload realigns with their reduced filing activity. QIP, with more modest filing declines and a smaller absolute scale, may be less exposed to this risk. IPH, however, faces the prospect of prosecution revenues declining significantly from current levels as the system clears of applications filed during their period of stronger market position. This adjustment could occur relatively rapidly – potentially within 2-3 years – if IP Australia sustains its current examination pace or makes further productivity gains that reduce the backlog more quickly.
And, on that note – while I do not usually provide disclaimers on my analysis (because who would be foolish enough to base any decisions on my random musings?), I feel like maybe I need to state the obvious out loud on this occasion!
Disclaimer
This analysis is provided for informational and commentary purposes only and does not constitute financial, investment, or professional advice. The author is not a licensed financial advisor, stockbroker, or investment professional. The data analysis and projections presented are based on publicly available information and involve assumptions, estimates, and interpretations that may prove to be incomplete or incorrect.
Readers should not rely on this analysis for making investment decisions regarding IPH Ltd, or any other company or security. Patent attorney practice involves numerous complex activities and factors beyond the scope of this analysis, and actual future outcomes may differ materially from scenarios discussed herein.
Anyone considering investment decisions should conduct their own due diligence and consult with qualified financial, legal, and tax advisors before taking any action. Past performance and historical trends are not necessarily indicative of future results.
The author accepts no responsibility or liability for any financial losses, damages, or other consequences arising from reliance on this analysis or any investment decisions made based on its contents.
Before You Go…
Thank you for reading this article to the end – I hope you enjoyed it, and found it useful. Almost every article I post here takes a few hours of my time to research and write, and I have never felt the need to ask for anything in return.
But now – for the first, and perhaps only, time – I am asking for a favour. If you are a patent attorney, examiner, or other professional who is experienced in reading and interpreting patent claims, I could really use your help with my PhD research. My project involves applying artificial intelligence to analyse patent claim scope systematically, with the goal of better understanding how different legal and regulatory choices influence the boundaries of patent protection. But I need data to train my models, and that is where you can potentially assist me. If every qualified person who reads this request could spare just a couple of hours over the next few weeks, I could gather all the data I need.
The task itself is straightforward and web-based – I am asking participants to compare pairs of patent claims and evaluate their relative scope, using an online application that I have designed and implemented over the past few months. No special knowledge is required beyond the ability to read and understand patent claims in technical fields with which you are familiar. You might even find it to be fun!
There is more information on the project website, at claimscopeproject.net. In particular, you can read:
- a detailed description of the study, its goals and benefits; and
- instructions for the use of the online claim comparison application.
Thank you for considering this request!
Mark Summerfield
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