Government intrusion could hinder research
However wellmeaning its intentions, the Biden administration recently set a perilous precedent by backing a waiver at the World Trade Organization that could deprive the creators of COVID-19 vaccines of their intellectual-property — IP— protections.
For decades, I have worked with universities and their researchers to help get their discoveries commercialized. The waiver could presage a broader incursion by the federal government into the intellectual property rights of American universities, research institutions and companies, large and small.
The IP waiver could trigger attempts by the federal government to march in under the 1980 Bayh-Dole Act and forcibly re-license patents that emerge from publicly funded research in university labs. This would be a shame.
The Bayh-Dole Act — which then-Sen. Joe Biden voted for — was designed to promote innovation by allowing universities to own the patents on their researchers’ discoveries and then license those patents to companies to turn them into real-world products. Before the Act, the government owned the patents on any discoveries made with federal grant support — and 95 percent of those patented discoveries languished unused in federal repositories.
Bayh-Dole has laid the groundwork for extraordinary economic growth in cutting-edge industries, ranging from agriculture to software to biotechnology. The law has been especially important for fostering the creation, launch, and financing of more than 13,000 startup companies since 1996. Bayh-Dole has contributed to the development of more than 200 drugs — including the mRNA technology in COVID-19 vaccines — as well as technologies ranging from 5G phones, Honeycrisp apples, drought-resistant seeds and even Google’s search engine. Bayh-Dole has contributed $1.7 trillion to the U.S. economy and supported 5.9 million jobs.
Bayh-Dole allows the government to assert control over a patent that resulted from federal funding only if the funded invention is not being commercialized. Sens. Birch Bayh and Robert
Dole crafted the Act to permit “march ins” only in cases of commercial abuse and not for price control.
Proof that the bar for federal control is high can be seen in the fact that the right has never been exercised in the four decades of the Act’s existence. Petitions to “march in” have been made over the years, but none have succeeded. The most recent attempt was by a consortium of 34 state attorneys general — led by Xavier Becerra of California — to compel the pharma company Gilead Sciences to reduce the price of its remdesivir drug. The attempt failed, but with Becerra now ensconced in Washington as secretary for Health and Human Services, there is every likelihood that there will be fresh attempts to use “march in” powers.
Clearly, drug prices need to be more affordable. But IP waivers and march-ins are the wrong solutions. Such efforts would damage financing for startups that commercialize academic research discoveries.
Consider the University of Florida and the University of South Florida, where my venture capital fund has supported new delivery systems for gene therapy and an experimental cure for blindness. The UF’s dorzolamide, an ophthalmic drop used for glaucoma, and FSU’s metal alkoxide process for the production of Taxol, a chemotherapy drug for lung, ovarian and breast cancer, were commercialized thanks to Bayh-Dole.
What drives such innovation in the Sunshine State and around the country? Obviously, scientists love seeing their hard work result in innovations that change the way people live, work and play.
But economic incentives matter, too. Scientists can’t work for free. They have families, mortgages and bills to pay like everyone else.
Intellectual property isn’t simply good business or a case of “us vs. them.” It’s about the rule of law that incentivized the very American scientists whose COVID vaccines now are protecting the world. During my 40 years working in the intellectual-property arena, I’ve seen the power of American university scientists, unleashed by Bayh-Dole, face many challenges. Our robust ecosystem of innovation depends on securing intellectual-property rights. Let us not “march in” to the labs of those whose work makes the world a safer place.