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 Over the last four decades, the United States has provided
uniquely fertile ground for trailblazing biotech companies like Pfizer and
Moderna. In less than a year, the two companies produced Covid-19 vaccines with
an extraordinary efficacy rate of 95 percent.
America's knack for spawning revolutionary enterprises stems, in large part,
from a single piece of legislation: The Bayh-Dole Act of 1980.
The law allowed universities and non-profits to retain the patents on
discoveries made with federal funding. In exchange for royalties, universities
can then license those patents to businesses, which take big risks in
commercializing those ideas. This public-private collaboration has spawned
thousands of startups.
Unfortunately, some activists and political leaders now want to
undermine the law. If the United States is to remain the world leader in
private-sector innovation, we have to preserve Bayh-Dole.
Prior to 1980, America was losing its economic edge, especially within
ideas-driven industries like the life sciences. During the 1970s, four European
countries developed more than half of all new medicines, while the United States
accounted for less than a third.
America had some of the world's greatest research universities. But there was no
easy way to translate federally funded academic research into commercial
technologies.
I saw this problem first-hand when I joined Stanford University. In 1970, I
founded its Office of Technology Licensing, focused on applying for patents and
finding private companies interested in commercializing those ideas.
At the time, most university advances backed by federal dollars never left the
laboratory. The patents simply reverted to the government, which generally did
little with them. When lawmakers drafted Bayh-Dole, fewer than 5 percent of
federally held patents had been licensed to private companies.
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The new law unlocked those patents' potential.
Suddenly, universities could easily license their researchers
discoveries and ideas. In my job, the number of invention
disclosures submitted to our office – paperwork detailing new
discoveries – immediately doubled.
Nationwide, this single reform created an unprecedented wave of
private-sector innovation. Between 1996 and 2017, more than 13,000
start-ups formed based on licensed university research.
At Stanford, this kind of technology transfer gave
rise to wildly successful companies, including Google. And the
University of Pennsylvania licensed the IP from early research into
messenger RNA technology, which, after decades of research and
billions in private capital, later led to the Moderna and Pfizer
Covid-19 vaccines.
Given this level of success, it's troubling that officials are
seeking to undermine Bayh-Dole.
Specifically, some state attorneys general, including now-Secretary
of Health and Human Services Secretary Xavier Becerra, have pressed
the government to invoke Bayh-Dole's provision on "march in" rights
to seize patents on Covid-19 treatments.
This would be an enormous mistake, as well as a misinterpretation of
the law. The march-in provision allows the government limited
authority to license additional developers, but only if current
licensees are failing to commercialize a patent. With numerous
treatments and vaccines for Covid-19 available, that isn't
happening.
If the government begins ignoring patents, it will end America's
long streak of hatching world-changing companies.
In the last 40 years, the ingenuity of American companies has
transformed almost every aspect of our lives. The Bayh-Dole Act made
this possible. Undermining it could bring our technological
renaissance to an end.
Niels Reimers is the founder and former executive
director of Stanford University's Office of Technology Licensing.
This op-ed was originally published in the Mercury News.
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