https://DevOpsCloud.io -- Cloud Monk Losang Jinpa

The Bayh-Dole Act of 1980, codified at 35 U.S.C. § 200 et seq., facilitates technology transfer from government research to public benefit. The Act does this by facilitating the transfer of patent rights for commercialization from federally funded innovation. It secures private patent rights from inventions from federal research, and is widely considered to be a tremendous success, and some consider this Act to be one of the finest pieces legislation in the last century. At the time it passed the United States was falling behind the world in innovation, but that trend then reversed in part due to this Act.

Simply put, this Act facilitates private investment in innovation from government-funded research, in a decentralized manner. The commercialization of the Honeycrisp (or Honeycrunch) apple, which was developed at the University of Minnesota, is cited as one (of many) examples of successes due to the Act.¹⁾

This Act uses patent rights to make the otherwise difficult transition between government-funded work and public benefit from private sale of products based on the research. Fewer than 5 percent of government patents were being used, and almost none in the biotech field, and there were 28,000 patents in the control of the government which were being wasted without utilization when this Act was passed. The use of innovation in biotech (35-40 billion dollars is spend each year in biomedical research, primarily at the NIH) was particularly enhanced by this Act.

The goal of the Act, which was enacted during the lame duck Congress after President Ronald Reagan's landslide election victory in 1980, was as follows:²⁾“It is the policy and objective of the Congress to use the patent system to promote the utilization of inventions arising from federally supported research or development; to encourage maximum participation of small business firms in federally supported research and development efforts; to promote collaboration between commercial concerns and nonprofit organizations, including universities ….”

This Act emphasized that many of the benefits should be in the United States, and that royalties should go back into research. The entrepreneurship today at American universities is attributed primarily to this Act.

The Bayh-Dole Act has been enormously influential in allowing a university or other entity to use federal funding for research and then obtain patents on their inventions, rather than the government insisting on retaining all rights to patents developed with federal funds as it had prior to this law.

This Act was unusual in not creating a new bureaucracy or requiring new funding.

A few months before the Act passed the Supreme Court ruled that biological innovation could be patented.³⁾

In recent years there has been a debate as to whether the Bayh-Dole Act is working well with biomedical patents, amid many conflicts of interest.

March in rights are a special power granted to the federal government to order a patent holder under the Bayh-Dole Act to grant rights in a patent to another party. This power has never been invoked but continues to be a topic of controversy:

35 U.S. Code § 203.March-in rights⁴⁾

• (a) With respect to any subject invention in which a small business firm or nonprofit organization has acquired title under this chapter, the Federal agency under whose funding agreement the subject invention was made shall have the right, in accordance with such procedures as are provided in regulations promulgated hereunder to require the contractor, an assignee or exclusive licensee of a subject invention to grant a nonexclusive, partially exclusive, or exclusive license in any field of use to a responsible applicant or applicants, upon terms that are reasonable under the circumstances, and if the contractor, assignee, or exclusive licensee refuses such request, to grant such a license itself, if the Federal agency determines that such—

• (1) action is necessary because the contractor or assignee has not taken, or is not expected to take within a reasonable time, effective steps to achieve practical application of the subject invention in such field of use;

• (2) action is necessary to alleviate health or safety needs which are not reasonably satisfied by the contractor, assignee, or their licensees;

• (3) action is necessary to meet requirements for public use specified by Federal regulations and such requirements are not reasonably satisfied by the contractor, assignee, or licensees; or

• (4) action is necessary because the agreement required by section 204 has not been obtained or waived or because a licensee of the exclusive right to use or sell any subject invention in the United States is in breach of its agreement obtained pursuant to section 204.

Private organizations have developed to facilitate the technology from universities in a decentralized manner. The Wisconsin Alumni Research Foundation (WARF) is an example of a private foundation that promotes the transfer of inventions from the University of Wisconsin to public benefit.⁵⁾ These private entities help license technology and attract start-up companies to the regions of the universities.

The Bayh-Dole Act does not have any safeguards against conflicts of interest by government policymakers having financial interests in a particular approach to a problem, such as coronavirus. There are, however, other general federal statutes relating to conflicts of interest. Universities tend to have their own policies, with rare enforcement, against conflicts of interest.

Patent Law

Snippet from Wikipedia: Bayh–Dole Act

The Bayh–Dole Act or Patent and Trademark Law Amendments Act (Pub. L. 96-517, December 12, 1980) is United States legislation permitting ownership by contractors of inventions arising from federal government-funded research. Sponsored by senators, Birch Bayh of Indiana and Bob Dole of Kansas, the Act was adopted in 1980, is codified at 94 Stat. 3015, and in 35 U.S.C. § 200–212, and is implemented by 37 C.F.R. 401 for federal funding agreements with contractors and 37 C.F.R 404 for licensing of inventions owned by the federal government.

A key change made by Bayh–Dole was in the procedures by which federal contractors that acquired ownership of inventions made with federal funding could retain that ownership. Before the Bayh–Dole Act, the Federal Procurement Regulation required the use of a patent rights clause that in some cases required federal contractors or their inventors to assign inventions made under contract to the federal government unless the funding agency determined that the public interest was better served by allowing the contractor or inventor to retain principal or exclusive rights. The National Institutes of Health, National Science Foundation, and the Department of Commerce had implemented programs that permitted non-profit organizations to retain rights to inventions upon notice without requesting an agency determination. By contrast, Bayh–Dole uniformly permits non-profit organizations and small business firm contractors to retain ownership of inventions made under contract and which they have acquired, provided that each invention is timely disclosed and the contractor elects to retain ownership in that invention.

A second key change with Bayh–Dole was to authorize federal agencies to grant exclusive licenses to inventions owned by the federal government.

Creative Commons Attribution-Share Alike 4.0