The Bayh-Dole Coalition, a lobbying front for pharma and university patent administrators, claims that Bayh-Dole is a “tech transfer statute” that would be misused if federal agencies used its march-in provisions to address drug pricing. If companies cannot price-gouge, they argue, “you’re going to kill innovation.” They talk nonsense.
Congress sets out Bayh-Dole’s “policy and objectives” at 35 USC 200. This “policy” replaces executive branch patent policy for funding agreements with small companies and nonprofits. The policy at 35 USC 200 requires that the patent system be used to, among other things, promote the utilization of inventions arising in federally supported research or development. It is utilization that matters throughout the statute. The implementing regulation for federal licensing of inventions at 37 CFR 404.2 weirdly reduces the statement of policy and objective to promoting utilization only. But Congress does not leave it at promoting utilization–Bayh-Dole also expects–Congress intends–that the patent system will also be used to maximize participation by small businesses, promote collaboration between nonprofits and for-profits, and promote free competition and enterprise. In addition, Bayh-Dole expects–Congress intends–that federal agencies protect the public from nonuse and unreasonable use.
We might observe, then, that (i) technology transfer is just one element of the express policy of Bayh-Dole and must be considered in context; and (ii) utilization of inventions, with benefits available to the public on reasonable terms, is the full objective–not merely attempts to patent and license inventions, not taking licenses to inventions, not “good faith” efforts to “commercialize.” There is no free pass in Bayh-Dole because a university is trying really hard to find a commercialization partner and can’t, or has found an exclusive licensee but nothing has come of it.