After seeing how the federal agencies intend to implement the recommendations from The White House Lab to Market Summit the difference between product and process oriented people really hit home.
Product people burn with a passion to get the job done. Process people focus on rules and procedures to minimize risk. Thus, product people are like the accelerator and process people are the brakes. You need both in your car, but if the brakes run the show you’ll never get out of the driveway. Similarly, whenever deal makers are subservient in a system to process people, frustration is sure to follow.
Last year the White House put together its Lab to Market Summit and asked Diane Palmintera and me to co-chair a panel of external experts to review several innovative agency technology transfer programs and come up with “transformational, not incremental” ideas to increase the commercialization of $140 B of federally funded research.
Steel yourself, gentle reader. This month we go hunting the living dead: arguments that keep climbing out of the grave to bite and infect the unwary.
Four months after NIH rejected the latest attempt to misuse the Bayh-Dole Act to control drug prices zealots have risen from the crypt claiming the law should be used to haunt drug developers. March-in rights were designed to force universities to issue additional licenses if effective efforts are not being made to commercialize a federally funded invention; if the licensee cannot meet national health, safety or regulatory needs; or if the licensee fails to make the product in the U.S. despite a pledge to do so.
Critics claim there’s another trigger: if they don’t like the price of a drug. While the cost of new drugs is a concern, their solution sucks the life blood out of a system leading the world in protecting public health. It’s time to drive a stake through that spectre.
This month’s column is based on my remarks to the Association of University Technology Managers (AUTM) at their annual meeting in San Francisco.
First of all, congratulations! You made TheWashington Post and they even spelled your name correctly. Unfortunately, AUTM was specifically called out in an article titled Patent Trolls Have a Surprising Ally: Universities.The name of another article appearing at the same time Patenting University Research Has Been a Dismal Failure, Enabling Patent Trolls: It’s Time to Stop while long winded speaks for itself. And two innocuous sounding reports from the Brookings Institution Building an Innovation Based Economy and University Start-Ups: Critical for Tech Transfer say that Congress should amend the Bayh-Dole Act to give the federal government control over whether you can grant exclusive licenses, that you have been unsuccessful as most technology transfer offices are not self-supporting, that your business orientation conflicts with the mission of a university and your alleged model of “licensing to the highest bidder” has failed. The New York Times accurately summarized the intended message in its headline Patenting Their Discoveries Does Not Pay Off for Most Universities.
For a profession that keeps a low profile and goes out of its way not to antagonize people, you may wonder what in the world’s going on that you are gaining such notoriety. The answer is that you are in the sights of several groups who do not wish you well. Some want to weaken the patent system for their short term benefit, some believe society would be better off if inventions were freely available without patents; some don’t think it’s moral for universities to work with industry, and others believe they should determine who reaps the rewards of innovation. While operating on diverse belief systems, they all have one thing in common: they don’t like you.
The report makes some good recommendations for increasing support for start-up formation, but implies that most university technology transfer offices (TTO’s) are not worth their cost because they are not self-supporting through patent licensing income. As Brookings acknowledges, universities spend the vast majority of their licensing revenues rewarding inventors or funding new research, not in supporting technology transfer operations. Brookings recommends that universities shift focus from patent licensing to start-up formation.
Ironically, recommendations from a preceding Brookings study would make both start- up formation and patent licensing more difficult.
Baseball is a good analogy for politics, which is why political talk shows have names like “Hard Ball.” A defining moment for any hitter is realizing that a 95 mile an hour fastball has just been deliberately thrown at your head. Pitchers throw the “beanball” is to see if a batter has the courage to play the game knowing that the risk of serious injury is literally an inch away. As former Dodger pitcher Sandy Koufax said: “Pitching is the art of instilling fear.”
A similar challenge is delivered to those who get in the way of well-funded lobbyist’s campaigns. An equivalent of the beanball is the attack article in the Washington Post, the paper of record for the political class. So it should not be surprising that as soon as universities announced that they could not support the House patent reform bill in its current form that a beanball was immediately headed their way.
“The pitcher has to find out if the hitter is timid. And if the hitter is timid, he has to remind the hitter that he’s timid” said Don Drysdale, a pitcher who built a career successfully intimidating batters. In baseball and politics the message behind the pitch is the same: “Kid, are you sure you want to take me on?”
The National Institutes of Health recently made its long anticipated ruling on a petition seeking to use the “march in” provisions of the Bayh-Dole Act as a mechanism for the government to control prices on drugs derived from federally-funded research by issuing compulsory licenses.
NIH correctly ruled that such actions are not sanctioned under the law. Three succeeding NIH directors have reached the same conclusion: the march in rights provision was never intended as a price control mechanism. Hopefully, the third time is the charm.
The petition was a reiteration of one dismissed in 2004 seeking to have the government march in to control the price of Norvir, part of the AIDS “cocktail.” Norvir was invented by Abbott Laboratories with partial NIH funding, thus it falls under the Bayh-Dole Act which grants ownership of federally funded inventions to universities and industry contractors so they can be developed for public use.
Before Bayh-Dole not a single drug was commercialized when the government took patent rights away from inventing organizations. Under the law at least 153 new drugs and vaccines are now alleviating human suffering world-wide.
“Gentleman: a man whose conduct conforms to a high standard of propriety or correct behavior.” Webster’s Ninth New Collegiate Dictionary
Howard Bremer (1923 – 2013)
Unfortunately, I’ve known for a couple of weeks what this month’s column was likely to be about. After a brief illness, my friend Howard Bremer died last Friday.
Howard was part of what’s rightly called The Greatest Generation—those who survived the Great Depression, fought and won World War II and then came home to build the most prosperous nation in history. Howard represented a rapidly receding era when integrity, modesty and personal responsibility were commonly held virtues.
As a 21 year old he went into the Navy during World War II. Coming back he attended his dearly beloved University of Wisconsin, becoming a patent attorney. He worked at the Wisconsin Alumni Research Foundation (WARF) from 1960 until the very end of his life. Howard claimed that he retired in 1988, but we all knew that wasn’t true. Anytime I called his office he was likely to answer.
I well remember first meeting Howard in 1978. I was on Senator Birch Bayh’s Judiciary Committee staff. Purdue University contacted the Senator about a patent problem they were having and Senator Bayh asked us to meet with them to learn more. Ralph Davis, who ran Purdue’s technology transfer office, brought along Howard and Norman Latker, then patent counsel at the National Institutes of Health. The trajectory of my life was about to change.
Senator Bayh (right) and staffer Joe Allen (left), circa 1980.
In its August 29, 2013 edition the New England Journal of Medicine saw fit to print two “perspective” pieces attacking the Bayh-Dole Act. The primary article is by Dr. Howard Markel entitled Patents, Profits, and the American People—The Bayh-Dole Act of 1980. It repeats previously refuted charges that patenting and licensing federally funded inventions harms the public interest. To give the author due “credit”, Dr. Markel does invent some new allegations as well which simply cannot go unanswered.
The Bayh-Dole Act was passed because Congress was rightly concerned that potential benefits from billions of dollars of federally funded research were lying dormant on the shelves of government. Government funded inventions tend to be very early stage discoveries—more like ideas than products—requiring considerable private sector risk and investment to turn them into products that can be used by the public.
Under prior patent polices government agencies took such inventions away from their creators and offered them non-exclusively for development. There were no incentives for the inventors to remain engaged in product development. Not surprisingly, few such inventions were ever commercialized even though billions of dollars were being spent annually on government R&D. This failure spurred two Senators from opposing sides of the aisle, Birch Bayh of Indiana and Bob Dole of Kansas, to form a remarkable partnership seeking a remedy.
How to Write a Patent Application is a must own for patent attorneys, patent agents and law students alike. A crucial hands-on resource that walks you through every aspect of preparing and filing a patent application, from working with an inventor to patent searches, preparing the patent application, drafting claims and more.
Without hesitation I recommend One Simple Idea and think it should be required reading for any motivated inventor. There is so much to like about the book and so much that I think author Stephen Key nails dead on accurate. The book is educational, information and inspirational. For the $14 cover price it is essential reading.
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