A room full of congressional staff, industry and academic reps and policy experts joined Eagle Forum Education & Legal Defense Fund Oct. 18 to learn about technology transfer.
The event, titled “: Technology Transfer, the Bayh-Dole Act, Patent Rights, and Society,” discussed how the bipartisan Bayh-Dole Act of 1980 has opened up commercialization of inventions from federal funded basic research, thanks to the law’s letting universities own the patents to their inventions. Bayh-Dole’s genius gives federal research agencies a very good model to emulate in order to do a better job themselves at tech transfer.
The briefing centered on this question: How can we get society the greatest benefit from the discoveries made from the hundreds of billions of federal research dollars that go to universities and federal facilities?
AUTM gave a sneak peak of the results of its latest annual survey, which pretty well answer that question. In 2017, $68.2 billion in research funding went to American universities, nearly 25,000 university inventions were disclosed, 15,335 patent applications were filed, 7,459 patents issued, 7,849 licensing deals were struck, 755 new products were created and 1,080 startups were launched. Thus, university-based research dollars continue to get a lot of bang for the buck.
Meanwhile, the National Institute of Standards and Technology, whose “Return on Investment Initiative” was announced last spring, seems to be moving ahead. A NIST official recently referred to “Bayh-Dole 1.1” at the Licensing Executives Society conference. No one from NIST attended the EFELDF program. They’d have heard that no legislative changes are needed to the Bayh-Dole Act.
It would be a tragic mistake to blame federal tech transfer underperformance on Bayh-Dole. Bayh-Dole needs no amending. The Stevenson-Wydler Technology Innovation Act of 1980 was something of a Bayh-Dole for federal research agencies. Perhaps it could use some more “stick,” such as on the performance and accountability fronts, to prod federal tech transfer. Amending Bayh-Dole could do more damage than good.
If there’s any law that achieved what it set out to do, the Bayh-Dole Act is it. And it’s still doing so, on account of statutorily required clear, certain, exclusive intellectual property rights for universities and licensees.
At the EFELDF program, the panel featured Joe Allen, former Senate Judiciary aide to Sen. Birch Bayh and Reagan administration Commerce Dept. official; Stephen Ezell, vice president for global innovation policy at the Information Technology & Innovation Foundation; Hans Sauer, deputy general counsel and vice president for intellectual property with the Biotechnology Innovation Organization; and Steve Susalka, executive director of AUTM, the university tech transfer managers’ association. EFELDF President Ed Martin greeted the packed room on Capitol Hill. I as EFELDF patent policy advisor moderated the panel discussion.
Speakers explained how patents and exclusive licensing deals justify private investors’ backing of the long, expensive, uncertain path of applied research and development. Most university patents get licensed to small businesses and startups for commercializing. The success of university tech transfer contrasts with the relatively little out of federal agencies.
The bipartisan Bayh-Dole Act intentionally employs secure, exclusive intellectual property rights as the vehicle for commercializing federally funded discoveries. This amounts to the “fuel of interest” added to the “fire of genius” that university researchers put into basic research, leading to foundational scientific discoveries some of which hold promise for practical usage. That’s where tech transfer comes in. Only, on U.S. campuses, Bayh-Dole incentivizes such transactions. In federal research agencies, bureaucratic anchors make tech transfer a low priority.
Bayh-Dole is a game-changer. Before Bayh-Dole, the government owned 28,000 patents with fewer than 5 percent commercialized. Bayh-Dole opened the floodgates, as seen in the, “The Economic Contribution of University/Nonprofit Inventions in the United States: 1996-2015,” to which the panel referred.
The Congressional Research Service has confirmed, “One of the major factors in the reported success of the Bayh-Dole Act is the certainty it conveys concerning ownership of intellectual property.” Clear title and exclusivity, along with licensing and commercialization decisions made locally, have made the difference.
That is, Bayh-Dole demonstrates how secure patent rights are the lynchpin to society’s getting the greatest benefit from federal research dollars. And the university track record has proven this beyond question.
Commerce Secretary Wilbur Ross notes how dramatically federal agencies trail universities in tech transfer and patent licensing. Secretary Ross points out that “federally funded university research is about five times more likely to result in a licensed patent technology and about seven times more likely to result in an active patent license” than federal agencies, as. That’s not insignificant underperformance by federal research labs.
NIST Director Walter Copan is right to examine how federal research facilities could improve their tech transfer record. NIST put out a Request for Information this past summer and convened listening sessions. Eagle Forum ELDF and the groups on thepanelThursday responded to NIST’s RFI. Many of us warned against changing Bayh-Dole. Hopefully, Mr. Copan will ensure that federal agencies learn from and adopt these crucial elements of Bayh-Dole. With his leadership at this pivotal stage of the initiative, NIST could reinvigorate federal tech transfer across the agencies without messing up what’s working for universities.
The solution is straightforward. Eagle Forum ELDF said in its RFI comments to NIST: “The best, most cost-effective and efficient means of improving the return on investment of federal labs’ discoveries is to adopt the attributes of the highly successful U.S. private-sector patent licensing and commercialization as well as the Bayh-Dole regime.”
Joe Allen, who oversaw implementation of Bayh-Dole and federal tech transfer at the Commerce Dept., has said the biggest hurdle to effective, productive federal agency technology transfer — so that we get more practical benefit from our tax dollars at work — is a lack of high-level, potent oversight to rein in free-wheeling federal agencies having little incentive to make tech transfer a high priority.in its RFI.
One can hope that NIST’s promising ROI Initiative hasn’t bogged down into an exercise where a report essentially calls for Congress to cough up more resources (just in time for the next fiscal year’s budget requests), while shifting the blame onto the law that’s working and ignoring the common-sense solutions offered by speakers at the EFELDF program, as well as the insightful solutions by many who commented during NIST’s RFI.
Images Courtesy of the Eagle Forum Education and Legal Defense Fund.