Posts Tagged: "tech transfer"

A high ranking Chinese official has announced that the Chinese government rejected a request from the United States to end its subsidization of industries identified by the Made in China 2025 initiative. These key industry sectors are areas where technological development is very important and as such, they’ve been at the center of allegations over the forced transfer of patented technologies to Chinese domestic firms as well as outright theft of trade secrets. The Chinese government has responded to concerns over the Made in China initiative with one senior economic official defending the program as open to foreign and private companies according to a report by Hong Kong’s English daily The Standard.

Secretary Ross gave an unequivocal endorsement of Bayh-Dole specifically, and more generally saying laws need to be updated to address business and technology realities of today, and to enable more companies to license federally funded technologies and take advantage of federally funded research in order to launch high-tech start-ups, create jobs, and grow the economy. “Our practices, policies, regulations, and laws all need to be updated to assure that technology transfer commercialization in the large-scale production and manufacture of innovative technologies occurs within the US,” Ross said. “We must address growing trade imbalances by producing in America the innovative products that the rest of the world needs to buy.”

A group of 16 leaders from politically conservative institutions sent a letter addressed to President Donald Trump lauding the Trump Administration’s decision last summer to initiate an investigation into Chinese trade practices regarding intellectual property. The investigation, authorized under Section 301 of the Trade Act of 1974, was aimed at identifying instances where U.S. technologies have been forcibly transferred to Chinese entities as a cost of entering the Chinese domestic market as a foreign entity… The recent letter to President Trump from conservative leaders is the latest indication that right-leaning institutions and think tanks have been more engaged with the debate surrounding the current U.S. intellectual property system.

Concerns about the ability of academic institutions to keep contributing to the U.S. innovation economy go well beyond federal funding stagnation according to the recent AUTM survey. In an executive summary section entitled The Perils of Eroding Patent Rights, AUTM notes that a slight decrease in options and exclusive license agreements compared to the number of non-exclusive license agreements could be due to fears that licensing companies have over protecting the intellectual property under the current iteration of the U.S. patent system. In 2016, option agreements were down year-over-year by 7 percent while exclusive licenses dropped 2.1 percent. Non-exclusive license totals, however, rose by 2.1 percent to 4,201 such license agreements in 2016. A sharp increase in startups ceasing business activity, up 37.4 percent to a total of 331 such startups, is another “ominous trend” which AUTM notes is likely attributable to eroding patent rights.

President Donald Trump signed a new space policy directive for human expansion across the solar system, a directive which hearkens at least slightly back to Horace Greeley’s “Go West, young man.” Increased human expansion in space will produce innovations that can improve human life on Earth to the benefit of U.S. consumers, provided our nation’s struggling IP regime can be righted for the proper commercialization of such inventions.

Most assaults on public/private sector R&D partnerships are launched by those who believe patents are inherently bad and that through some undefined magic publicly funded inventions will be developed if they were only made freely available.  However, every couple of years attacks come from another, more threatening direction — claims by well placed, but inexperienced “experts” that if their pet theories were adopted technology transfer from the public sector would sky rocket. One idea being promoted is that universities should double or triple the number of their inventions to justify continued federal funding, thus triggering a spike in commercialization rates. In reality the only  spike would be in patenting dubious inventions to pad the numbers, leading to depressed licensing rates as portfolios were filled with junk.

President Donald Trump has signed a memo at the White House which authorized the U.S. Trade Representative (USTR) to make an inquiry into the alleged theft of American intellectual property which is believed to be aided by the Chinese federal government. Although there are concerns that the statement could increase tensions with China just as the U.S. government is seeking more cooperation from China on issues surrounding North Korea, the recent Trump memo comes in response to the $600 billion American intellectual property owners lose each year, a majority of which is due to Chinese tech transfer policies.

Bayh-Dole is running on autopilot without Executive branch oversight and U.S. patents are no longer the world’s gold standard. Without a course correction, we could be headed back to the bad old days… Bayh-Dole has become a driver of the U.S. economy. Every day of the year universities form two new companies and two new products from their inventions are commercialized. University spin out companies tend to stay in state becoming significant contributors to the regional economy… Bayh-Dole is a recognized best practice. The Chinese have adopted it while strengthening their patent system to better compete with us.

A recent Canadian survey (CRA Survey) has conclusively attributed lowered levels of R&D investment in Canada’s innovation ecosystem to the country’s unique judicial “Promise Doctrine.” The Promise Doctrine is a controversial patent elimination dynamic, judicially imposed during patent enforcement proceedings, often after a patented product has achieved its developmental endpoint, having successfully completed its long and costly commercialization. By its unpredictable applicability, like an unseen open manhole, Canada’s promise doctrine can cancel the benefits of a long journey at its market-ready endpoint… As the Survey suggests, long-lasting damage to Canada’s innovation ecosystem may already have occurred, which is why the Survey bears so heavily on the U.S. patent system’s own endpoint “open manhole”, Inter partes review (IPR). However Canada deals with its promise doctrine woes, we too have much to learn from this Canadian Survey.

Senator Chuck Grassley (R-IA) added language to the fee-shifting provisions in the PATENT Act that would offer an economic hardship exception to fee shifting for “an institution of higher education.” The reason that Iowa State and the University of Iowa find themselves on the outside looking in is because of the way they have structured their patent ownership and licensing efforts. As is rather common, Iowa State and the University of Iowa place ownership of patents outside the institution and in the hands of a Research Foundation, which is a separate entity altogether.

Now more than ever succeeding is all about making better products and offering new and improved services quicker and more reliably than your competitors. Surprisingly, at a time when many major technology corporations are struggling to innovate, we see utter disdain for patent owners. Void from the discussion is any perspective on the real problems facing American companies – namely innovating to obtain a competitive advantage and set themselves apart from the competitors they have today and the competitors they will surely have tomorrow. Increased patent licensing, or outright acquisition of patents, will not only help, but will likely become essential for those companies who understand the importance of continually squeezing out innovation as fast and efficiently as possible.

Gulbrandsen’s chief complaint with the U.S. system centers around the fact that it has become enormously easy to challenge issued patents once they have been granted. In fact, organizations in pursuit of acquired technology are leveraging the kill-rate at the Patent Trial and Appeal Board (PTAB) at the United States Patent and Trademark Office (USPTO), to negotiate lower licensing payments. Threats are made that patents will be challenged in Inter Partes review, “so that you amend the license and reduce the fees,” Gulbrandsen explained. “So, immediately you know that devalues the patent and devalues the license agreement that you’ve got.”

This patenting step is absolutely crucial for the commercialization of inventions. In the absence of a strong intellectual property system – specifically patents – most of those inventions will never see the light of day. Why is that? The answer is quite simple – the cost to develop those inventions to a marketable product are significant and in the absence of intellectual property protections that the patent system provides, no one will ever invest in the promise of an invention. Said another way, how many of you would invest in a company that will spend tens to hundreds of millions of dollars on a product knowing that a competitor will be free to offer the same product at a fraction of the cost since they invested substantially less in R&D?

Fortunately, a new study showing that academic patent licensing contributed more than $1 trillion to the U.S. economy over eighteen years blows the stuffing right out of that straw man. We can only hope Congress gets the message before it turns the patent system into a weapon to squash inventors.

How tragic if the United States of America turns its patent system into a tool that rich and powerful companies use to suppress innovation that challenges their comfortable status quo. But Just because there are sharks doesn’t mean you stay out of the ocean. We need to get ahead of the curve and aggressively publicize what we’re doing to protect the public interest. That means showing how Bayh-Dole and the patent system advance human well-being and wealth creation not just here but around the world.