Posts Tagged: "tech transfer"

AUTM, which represents the academic technology management profession, just released the results of the survey of its members for 2021. Once again, the results are impressive, particularly considering that the U.S. economy was just beginning to emerge from the devastating effects of the COVID-19 pandemic…. It’s clear that despite continual attacks on the Bayh-Dole system, which allows academic institutions to own and manage federally funded inventions without Washington micro-management, our system keeps truckin’ right along, year after year, leading the world.

On August 9, President Joe Biden signed into law the Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act, enacting a major legislative package that will provide $280 billion in federal funding to encourage the domestic production of semiconductor products in the United States as well as fund research and development projects in advanced technological fields like quantum computing and artificial intelligence. Although the 1,000+ page bill establishes massive investments into several areas of developing technologies, it focuses very little on the intellectual property rights that are critical for protecting the new technologies that would be developed through federally funded projects.

How about some good economic news? That’s in short supply these days as the nation teeters on the brink of recession, driven by raging inflation and skyrocketing gas prices. But in good times and bad, our technology transfer system created by the Bayh-Dole Act just keeps chugging along. A just released study by the Biotechnology Innovation Organization (BIO) and AUTM, which represents the academic technology management profession, shows that academic patent licensing contributed up to $1.9 trillion to the U.S. economy while supporting 6.5 million jobs between 1996 – 2020. Even more impressively, this impact increased substantially since the last survey was released three years ago. That showed an economic impact of $1.7 trillion with 5.9 million jobs supported.

While the discussions around waiving intellectual property (IP) rights set forth in the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) are currently (and somewhat amorphously) limited to COVID-19 related drug and medical products, it is probably shortsighted to ignore the implications for other technologies critical to sustaining our environment and advancing a more healthful world. In fact, if we want to ensure continued investment in these technologies, we should be very concerned about the message conveyed by the international political tide: if you overcome a challenging scientific problem and your solution has the potential to save lives, be prepared to be subjected to intense political pressure and to potentially hand over your technology without compensation and regardless of the consequences.

It’s hard to believe that, not too long ago, alliances between the public and private sectors were unheard of unless the government was picking up the entire tab. After World War II, the policy was that if the government funded even a small percentage of the research, it would take any resulting inventions away from those who created them to make the discovery readily available to anyone and everyone. While that might sound noble, it was a death knell for commercialization because then, like now, these discoveries required significant private sector effort and investment to turn into commercial products. The result was that not only were few government funded inventions ever developed, but even worse, companies avoided alliances with government funded institutions.

How many people or organizations could undergo an exhaustive investigation into everything they’ve done over the past 30 years and emerge unscathed? That’s what just happened to the technology transfer operations at the Department of Health and Human Services (HHS), with the spotlight primarily focused on the National Institutes of Health (NIH). Of course, an exercise like this has to find something, so the report that resulted from this exercise is titled “NIH Should Publicly Report More Information about the Licensing of Its Intellectual Property”. After extensive digging, all it uncovered are some pretty small potatoes.

In recent years there has been a paradigmatic shift towards commercializing technology through startups. There is a universal understanding that university inventions are in early technology readiness level and need substantial development to be ready to go to market. Many universities have taken it upon themselves to fund some of the startups, sometimes co-funding alongside venture funds… The next frontier for this industry will likely be in the transformation of data-rich sectors using artificial intelligence (AI) and machine learning technologies. One area largely accumulating data is the healthcare sector. Medical knowledge is doubling every 73 days, yet we are barely scratching the surface of utilizing this data. With our computing power today and the new era of AI we are at the cusp of a healthcare revolution. Academic institutions are sitting on massive amounts of valuable data that is vastly underutilized, and research institutions will soon begin to recognize and develop healthcare data into the next revolutionary asset.

Open innovation is a key ingredient to the development of valuable intellectual property. Research institutions, universities, and private businesses work in close collaboration with one another, sharing confidential business information, processes, and trade secrets in order to create content. But while open innovation is a boon to creativity it is also a vulnerable entry point for bad actors to exploit the open and collaborative mindset of research-focused institutions (like universities) or the faith in contractual confidentiality obligations that many companies rely upon to conduct business. Several recent U.S. government findings have placed the blame for some of the most significant threats to domestic intellectual property at bad actors in the People’s Republic of China. A report by U.S. Trade Representative Robert Lighthizer found that Chinese sponsorship of hacking into American businesses and commercial networks has been taking place for more than a decade and posed a significant threat to our nation’s economic prosperity and competitiveness.

In late August, the U.S. International Trade Commission published a notice of institution of a Section 337 investigation on behalf of the Regents of the University of California, which is now underway. The University filed a complaint in July alleging that a series of major retailers including Amazon.com, Bed Bath & Beyond, IKEA, Target and Walmart have infringed patents through the importation of certain filament light-emitting diodes (LEDs) and products containing the same. The ITC action is part of an enforcement campaign that is being hailed by the firm representing the university as a “first-of-its-kind university-led effort” to vindicate patent rights owned by the institution.

The original motivation for the Bayh-Dole Act was to encourage the commercialization of academic innovation so that new technologies could be available for the benefit of all. Yet today, I feel compelled to call attention to a compliance landscape that is significantly different than that of the past four decades—one that could have dire consequences for institutions if they choose to be complacent. Not only do sponsoring agencies have an interest in how tech transfer complies with Bayh-Dole regulations, other entities have entered the competitive landscape looking for opportunities to turn lack of compliance to their advantage. In just the past two years we’ve seen a spike in requests for the government to exercise march-in rights by a variety of non-governmental advocacy groups (NGOs). These NGOs are staffed by PhDs who are well-versed in the academic tech transfer ecosystem and they actively seek out pockets of non-compliance. An attempt is then made to extricate key technologies using non-compliance as a lever and the NGOs become the primary influence on how innovation is put into the marketplace. I would ask the question, “Who will pick up on these inventions?” If you follow this chain of events we may find ourselves in a situation where innovation is not freely available to all (the original intent of Bayh-Dole) but an endpoint where NGOs and their backers control how technologies get into the marketplace.

I recently delivered a keynote address at a special session of the AUTM Annual Meeting, where the Advanced Medical Technology Association (AdvaMed) released its new University Technology Transfer Best Practices Guide. Following is a transcript of that speech.

It would be a tragic mistake to blame federal tech transfer underperformance on Bayh-Dole. Bayh-Dole needs no amending. Bayh-Dole demonstrates how secure patent rights are the lynchpin to society’s getting the greatest benefit from federal research dollars.

NASA will enter into a range of different patent license agreements from no-cost evaluation licenses up to exclusive license. The agency’s goal in licensing technologies is to reach the widest distribution possible for the commercialized technology. To some, it may seem unusual that exclusive licenses would be part of NASA’s licensing options if the goal was truly the widest distribution possible. “We’ll only grant an exclusive license if we believe that exclusivity leads to the widest distribution,” Lockney said, noting that there were a couple of examples where such a situation could play out. An exclusive license for the broadest possible distribution could make sense if the technology was being commercialized in a medical device and a single multinational company offers an incredibly broad distribution model; such was the case with a flexible insulating plastic material for use with pacemaker wires recently licensed by NASA with Medtronic. In other situations where multiple companies occupy the same market, NASA might grant an exclusive license to one company if it’s determined that, without the exclusivity, none of the firms could invest adequately in commercializing the technology.

Academic institutions and federal labs receive approximately the same amount of  R&D funding from the government, although universities have more money overall because of contributions from industry, states and other sources.  Still, the disparities in their licensing impact reinforces the implication from Sec. Ross that a top to bottom review of the federal lab tech transfer system is sorely needed.