President Biden wants to lower drug prices. While that is a laudable goal, we can’t afford to undermine the intellectual property rights that helped produce these innovative drugs in the first place. A recent proposal would do just that, and it’s not limited to drugs.
The proposed policy change would reinterpret a 1980 law that ushered in a new era of American innovation and collaboration between the public and private sector. But if this proposed policy change is finalized, it will cause a wide swathe of our high-tech sector to stall out. And, while in Congress, Biden was a passionate champion of this very law and the critical innovation it spurred.
Most Americans probably hadn’t heard of the Bayh-Dole Act until the White House announced the change. The goal of the popular bipartisan act was to get the public and private sector to work together to further technology first developed on university campuses. The law enabled universities to keep control of their patents and leverage them in license deals with businesses. Universities gained a new revenue stream. The public gained access to new innovative products — the fruits of taxpayer-sponsored research that otherwise would have never seen the light of day.
Biden was among the 91 of 100 senators to vote yes, and the legislation launched an innovation renaissance. Based on the Bayh-Dole framework, thousands of startups have formed to transform early-stage research into applications that improve health and quality of life.
Yet today, as part of a war on drug pricing, the current Biden Administration proposal departs from his previous pro-innovation stance. The law provides for the government to “march in” and seize patent rights on discoveries that once received federal funds, but only in rare circumstances, such as when a company has failed to commercialize a much-needed product altogether.
Now, Biden aims to let federal agencies march in whenever they decide that the price of a medicine is too high. But based on the actual proposal, the new authority would be used on other promising technologies as well — for instance in renewable fuels, EV technologies or any product deemed to be in the public interest.
Companies (and their investors) need reliable patent rights to justify the financial risks of licensing new discoveries. If the government guts Bayh-Dole, companies won’t invest in or license academic research.
And Biden isn’t just going against his previous stance on Bayh-Dole. By endorsing march-in rights as a means of price control, he’s counteracting other ambitions he’s been vocal about: fostering economic growth, competing with China, generating high-skill U.S. jobs, and tackling cancer. All of these goals depend on secure patent rights.
The President is right to prioritize affordable health care and to ensure that Americans have access to life-changing drugs. But, there are other ways to accomplish this goal without undercutting the success of Bayh-Dole. The 44-year-old act has made the United States a world leader in the very pharmaceutical and biotechnology industries that we need to solve global health challenges — a model that other countries have tried to replicate.
In short, protecting Bayh-Dole is far more consistent with Biden’s legislative track record and his ambitious goals for the nation — which is why he fought for it all those years ago. Let’s get back on track, Mr. President.
Dana Robert Colarulli is a partner at ACG Advocacy LLC and executive director of Licensing Executive Society International. He is a former director of governmental affairs at the USPTO. This piece originally ran in RealClearHealth.
